Tech megadeal market thrives despite the unparalleled upheaval, so 47% of technology executives expect profitability to fully rebound in 2021, according to the EY Technology Global Capital Confidence Barometer (CCB).

Megadeals market represented 59% of global technology sector deal value in 2020 and

social and environmental impact, important elements in defining the long-term strategies of companies in the technology sector

Despite continuing uncertainty amid the COVID-19 pandemic, the technology sector saw transformative deal activity soar over the past year, with mergers and acquisitions (M&A) increasingly becoming a key lever for growth as businesses look to recovery. This is according to the 23rd edition of the EY Technology Global Capital Confidence Barometer (CCB), which gauges corporate confidence in the economic outlook among technology executives.

Megadeals that were US$5b and above represented 59% of all global technology sector deal value in 2020, up from 47% in 2019. This is consistent with the CCB findings, with 16% of sector respondents planning to pursue transformative deals valued at US$5b or more in the near-term. Technology companies further outpaced the market in relation to total shareholder returns according to the report, enabling many businesses to generate substantial returns despite only modest growth in revenue and profitability.

Overall, technology executive respondents are optimistic about the future, with nearly half (47%) expecting profitability to fully rebound this year (vs. 23% across all CCB respondents).

”And while technology respondents acknowledge that the outlook for short-term organic growth is challenging, 51% plan to pursue M&A in the next year to sustain growth”, says the study.