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July 17, 2025

Industrials Industry Report - Q2 2025

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Explore Industrials Industry M&A Trends in Depth

Industry Trends

M&A transaction volume in the Industrials industry remained robust in Q2, supported by continued capital investment and strategic consolidation across the space.

Advancements in AI and automation, combined with evolving U.S. regulatory and antitrust policy, are driving growth in the industry. These trends are attracting heightened interest from private equity, which is well-positioned to deploy capital as financing challenges begin to ease.




Market Dynamics


  • Overall, the Industrials industry has shown a strong growth trajectory in Q2 2025 following a mixed first quarter. Sectors within the industry such as Aerospace & Defense, Contract Manufacturing, and Specialty Contracting have displayed rapid growth through the second quarter of 2025.
  • The Aerospace & Defense sector continues to perform strongly with both the highest sector overall valuation (21.2x EV/EBITDA) as well as the largest increase in YoY multiple appreciation (+26.4%). Sector performance is driven primarily by geopolitical tensions, increase in AI related technologies, and growing needs of the space sector.
  • Uncertainty regarding geopolitical tensions and the impact of tariffs to US supply chains remain near term headwinds, but the industry is bolstered by structural themes such as digital transformation in automated manufacturing (AI-driven plants and data centers), reshoring, and infrastructure investment.
  • Construction investment stemming from the bipartisan Infrastructure Investment and Jobs Act (IIJA) is expected to continue driving growth in the Specialty Contracting sector through 2026.



Learn More

Reach out to Dinan Capital Advisors Managing Director Tom Gerlacher for more report insights.

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