Executive summary
AI-related deal activity in North America reached new highs between 2021 and 2025, with volume accelerating sharply from 2023 onwards. The share of AI deals nearly doubled in the past two years, confirming AI as a major focus for investors and companies alike.
Deal volume reached 589 transactions in 2025, up from 375 in 2024, a 57% year-on-year increase. Between 2021 and 2025, AI deal volume totaled 1,634 transactions. The software sector accounted for 1,183 (72%) of the total, reinforcing its clear dominance.
Momentum is also building within professional services, financial technology, industrial goods and IT services. Within software, business intelligence and process automation remain the largest subindustries, reflecting demand for data-driven tools that boost efficiency. Healthcare analytics, HR and workforce support systems and marketing software are also growing, showing AI’s broader use in both business operations and customer engagement. AI has moved well beyond a niche innovation.
AI deals represent an increasing proportion of all deals
AI-related* deal activity has grown steadily over the past five years, even as the broader deal environment fluctuated. (Figure 1).
In 2021 and 2022, AI represented a relatively small portion of total deals (2%), with limited growth. After 2023, the proportion of AI deals began to climb. By 2025, AI accounted for more than 7% of all deal activity.
Software Industry Driving AI Investment
AI investment is heavily concentrated in a few key industries, with software leading by a wide margin (Figure 2). In North America, between 2021 and 2025, the software sector accounted for 72% of the total AI-related deals.
Two recent transactions illustrate the range of activity within the software space.
- MEquilibrium was a $10 million – $49 million acquisition by Bow River Capital, a private equity investor. This was structured as an add-on buyout, and was selected to strengthen an existing portfolio.
- Paradox Inc. was acquired by Workday Inc. with a deal value between $2 billion – $5 billion.
Both point to acquirers seeking software companies with clear strategic value and software solutions that support long-term strategic fit. In both cases, buyers appear to prioritize software solutions that support long-term strategic goals. The sector’s dominance reflects the central role AI now plays in software development, automation, and data analytics.
The dominance of AI in software deals indicates the growing adoption of AI-driven tools to enhance efficiency and client delivery.
Across a few key industries, the appetite to build AI capability has been steadily increasing. In the software sector, the share of AI-related transactions has grown sharply, from about 7% in 2021 to nearly 30% in 2025 (Figure 3). This reflects AI’s move from an optional addon to a standard feature across software companies.
Demand for AI Infrastructure is strong but deals activity muted
As companies race to train larger models and deploy AI at scale, investment is being made into the physical infrastructure that enables growth, highlighting how the foundations of AI are becoming just as important as the applications themselves (Figure 6).
The growth in 2025 was muted due to ongoing trade tensions and rising tariffs shaking confidence and disrupting supply chains. Many of these sub-industries are directly affected by tariffs, creating uncertainty despite strong underlying demand. Despite these challenges, activity in AI-related infrastructure was above 2023 levels. This challenge could be further compounded in 2026 due to the ongoing conflict in the Middle East.
The rise in AI-related infrastructure deals shows market recognition of the importance data centers, power supplies, and hardware and other adjacent fields required to support the expansion.
