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This quarterly review highlights key trends in project and policy development, mergers & acquisitions, and early-stage funding in digital water globally. Notable market events in digital water are included in this analysis. The data presented in this analysis is also available in Bluefield’s Data Navigator, an online, interactive platform for projects, M&A, forecasts, and market data shaping global water markets.
Sample Takeaways:
- Digital water companies utilize external management of investment pipeline to stay on top of innovation. This quarter, Veralto announced its investment in Switzerland-based Emerald Technology Ventures’ Global Fund II. These investments expedite innovation and provide early access to new technologies without growing in-house capabilities. In the age of artificial intelligence (AI), digital water companies are looking to spark innovation faster through multiple channels. This quarter, Grundfos, Veolia, and Siemens also announced partnerships to enhance the integration of AI into their products.
- Digital water companies mitigate impacts of tariffs in second quarter (Q2) with overall positive outlook for year-end. Despite the tariff announcements throughout Q2, digital water companies recorded strong performance. On average, the top 10 publicly traded digital water companies tracked reported 8% year-over-year (YoY) increase in quarterly revenues. Companies noted they were able to mitigate tariff impacts through supply chain management and pricing strategy. Xylem, Veralto, and Mueller reported a positive outlook in their earnings, citing the necessity of water infrastructure upgrades that will shield them from macroeconomic trends.
- M&A activity continues to slow down in Q3. In Q3 2025, Bluefield tracked one digital water M&A deal, bringing the total count to 12 so far this year. This quarter is once again the lowest deal count for digital water since Bluefield’s database tracked activity in 2016. This follows a similar trend for Q2, with investors limiting their financial activity due to broader macroeconomic and policy uncertainty while making investments across other water segments. Water is a haven for investors as an essential service; however, investors have been looking toward other water segments.
