NextFin News - TMX Group is telling investors that the long freeze in Canadian initial public offerings is finally thawing, and that a deep pipeline of companies is waiting to list on the Toronto Stock Exchange as U.S. deal activity sets the tone north of the border. Speaking at a Canadian finance conference in New York on September 29, 2026, the exchange operator's message was one of cautious optimism: the Canadian capital markets are waking up, but the recovery is being imported rather than homegrown.
The stakes are concrete. Canada's equity markets have been working through a prolonged slowdown that took annual equity issuance from C$58.1 billion across 861 deals in 2021 down to C$20.5 billion in 2022, C$19.7 billion in 2023 and C$18.4 billion in 2024, with only two IPOs priced in 2025. Now 2026 has produced the country's biggest listing in years — Apotex Health Corp., which priced at C$24 per share, at the top of its range, and raised approximately C$1.5 billion, accounting for 59 percent of the C$2.53 billion raised through Canadian IPOs in the first half of the year. TMX called the listing the largest life sciences IPO in TSX history. Behind it, equity issuance in Canada climbed 46.8 percent in the first half of 2026 to C$17.86 billion, and TSX new listings in August 2026 were up sharply year over year.
Yet the central tension is this: TMX's own growth engine is no longer primarily Canadian. More than half of the company's revenue now comes from outside Canada, its most aggressive expansion is a US$300 million acquisition of Cboe Australia and Cboe Canada, and its newest trading venue — AlphaX US — is aimed squarely at American liquidity. The question for investors is whether TMX is a bet on a Canadian market revival, or a trading-infrastructure company that has quietly outgrown Canada.
The Canadian Listings Market: A Recovery That Looks Real, But Is Narrow
The evidence that Canada's IPO market is turning is not anecdotal. TMX's own monthly financing statistics show the inflection. In March 2026, TSX welcomed 31 new issuers, up from 28 in February and from 18 in March 2025, with total financings raised up 195 percent year over year. By August 2026, TSX added 14 new issuers — 10 of them exchange-traded funds, three mining companies, and one industrial products and services company — and total financings raised jumped 194 percent from July and more than 19 times the August 2025 level. TSX Venture Exchange added three new issuers in August, including two miners and one Capital Pool Company.
The turnaround is even starker against the recent trough. The C$2.53 billion raised through Canadian IPOs in the first half of 2026 already exceeds the C$1.47 billion raised through 11 deals in all of 2025, and the C$1.76 billion raised in total between 2022 and 2024. One deal, however, is carrying the recovery: Apotex alone accounted for nearly six in ten dollars raised through IPOs in the first half. A market that depends on one company for 59 percent of its IPO volume is not yet a self-sustaining pipeline.
The catalyst TMX executives point to is external. As CEO John McKenzie put it in an interview last year:
The U.S. generally always leads the IPO market in terms of liquidity. As we see deals get done in the U.S. and get priced well, that's giving the same conditions in the Canadian markets. We are seeing deals come to market, and we're seeing a deep pipeline of deals that can come (later).
In other words, Canadian confidence follows U.S. pricing. The U.S. market has priced 109 IPOs raising US$146.5 billion through mid-September 2026, up more than fourfold from the same period a year earlier, pacing toward the strongest U.S. IPO year since the 2021 boom. When SpaceX priced the largest IPO in history in June 2026 — US$85.7 billion — the spillover effect began to reach Canada.
The transmission mechanism is straightforward. IPO windows open on comparables, not on macro sentiment in the abstract. A Canadian chief financial officer deciding whether to list watches two things: whether similar companies in the United States are pricing successfully, and at what multiples. When U.S. deals price well, Canadian boards gain the confidence that their own valuations will be accepted. When U.S. windows close, Canadian boards wait — because a failed IPO is more damaging than a delayed one. That is why TMX frames the Canadian recovery as derivative of U.S. conditions rather than as an independent Canadian story.
There is also a policy shadow over the Canadian market. Tariffs on Canadian imports imposed by the U.S. administration have been cited by capital markets experts as one reason Canadian IPO activity lagged U.S. activity. That headwind has not disappeared; it has merely been outweighed by the momentum of large, successful deals.
TMX's Real Growth Story Is Not Canada
While the Canadian listings recovery makes the headlines, TMX's financial results tell a different story about where the company's growth actually comes from. In the second quarter of 2026, revenue rose 16 percent to C$487.5 million from C$421.7 million a year earlier, and adjusted diluted earnings per share climbed 19 percent to C$0.62. For the first half of the year, revenue reached C$975.7 million, up 16 percent, while net income attributable to shareholders more than doubled to C$367.2 million from C$180.0 million.
Those numbers are not being driven by a sudden surge in Canadian listings. They reflect a company that has systematically diversified away from its home market. More than half of TMX's revenue is now generated outside Canada. The 2023 acquisition of VettaFi, a U.S. index and data analytics provider, cost about US$1 billion and plugged the company into the global ETF ecosystem, where it supplies indexes and data to fund issuers worldwide. Trayport, its electronic trading platform for energy and commodities, has been expanded into the United States. And in November the company opened a New York office to pursue American business.
The most visible expression of this strategy is the April 2026 agreement to acquire Cboe Australia and Cboe Canada from Cboe Global Markets for US$300 million, about C$409 million. The deal brings equities trading and listing venues and market-data services under TMX control, reduces complexity and costs for Canadian market participants, and gives TMX a foothold in Australia — a natural-resources-heavy market where it already claims global leadership in mining listings. TMX has said it expects the acquisition to be accretive to earnings per share within the first year of closing, excluding potential synergies. The transaction remains subject to regulatory approvals in Canada and Australia, and the two acquisitions will close separately once those conditions are met.
Then there is AlphaX US, the off-exchange equity trading venue that represents TMX's first expansion of its Markets division outside Canada. The platform trades U.S.-listed securities under Regulation NMS and is open to FINRA-registered broker-dealers. Heidi Fischer, president of U.S. equity trading at TMX, has said the platform is being expanded with a new book of business, and the company is also exploring a fixed-income alternative trading system — though executives caution those plans are not finalized and not expected imminently. Entering the U.S. ATS market means competing against established venues with deeper liquidity and entrenched broker relationships, but TMX's argument is that execution quality and analytics can win order flow even in a crowded field.
The logic is straightforward, and McKenzie has stated it plainly:
It's always been the ambition of the organization to be invested in this market as this is the most competitive market in the world, and the most liquid capital market.
For TMX, Canada is the home base; the United States is the growth market.
Cyclical Recovery, Structural Diversification
Is the Canadian IPO pickup cyclical or structural? The answer requires separating two different questions, because the same event points in opposite directions depending on which entity you are analyzing.
The Canadian listings recovery is cyclical. It is being driven by improved risk appetite, successful U.S. comparables getting priced, and a pent-up pipeline of companies that waited out the 2022-2024 drought. Cyclical recoveries mean-revert if the conditions that produced them reverse. If U.S. IPO windows tighten, or if tariff pressures intensify, Canadian issuance would be expected to slow again. Three pieces of evidence support the cyclical read. First, the recovery is concentrated in a small number of large deals rather than broadening across issuers. Second, TMX's own executives explicitly tie Canadian conditions to U.S. liquidity — a dependency that cuts both ways. Third, the underlying driver, investor risk appetite for new issuance, is a well-documented mean-reverting variable: the 2021 peak was followed by three years of near-closure.
TMX's own transformation, by contrast, is structural. The shift from a Canadian exchange operator to a diversified, cross-border markets-infrastructure group is a change in the company's earnings base that will not reverse on its own. Revenue generated outside Canada, the VettaFi acquisition, AlphaX US, and the Cboe deal are permanent additions to the business model. Even if Canadian IPO volumes stall, TMX's revenue mix is no longer what it was a decade ago. Structural changes do not require favorable cycles to persist; they change the baseline.
The second-order implication is the one the market is not fully pricing. A Canadian IPO revival is good for TMX's listings and issuance revenue, but the bigger earnings lever is U.S. market share. AlphaX US and the Cboe Canada acquisition both aim to capture trading volume in the world's deepest liquidity pool and to consolidate a fragmented Canadian venue landscape. If TMX succeeds in taking share in U.S. equities trading, or in simplifying Canadian market access enough to draw order flow, the earnings impact would dwarf the listings recovery. The listings story is the narrative; the market-structure story is the margin.
There is a third layer that most coverage misses: TMX's caution on prediction markets is a deliberate strategic choice with opportunity-cost consequences. While ICE has committed up to US$2 billion to Polymarket and CME Group and Cboe have unveiled plans to enter the space, TMX is sitting it out. McKenzie explained the divide:
We're not comfortable with the risk associated with it for us to provide to our clients. It has to be demand-based. We need to be ready, but we need to see that there's a demand curve that makes sense for us.
That discipline protects the balance sheet and the company's regulatory standing, but it also means TMX is voluntarily forgoing one of the industry's fastest-growing revenue pools. Investors who want prediction-market exposure will not find it in TMX.
The Counter-Case: Canada Still Trails, and Concentration Is a Risk
The strongest argument against TMX's optimism is that the Canadian IPO market remains thin by historical standards. The C$2.53 billion raised through IPOs in the first half of 2026 is a recovery from the trough, but it is not approaching the 2021 peak, when equity issuance reached C$58.1 billion. The Brookfield-backed Rockpoint Gas Storage IPO, at C$704 million, was a bright spot, but a market that needs a C$1.5 billion deal to carry more than half its volume is fragile. If the next two large names delay or choose New York, the "deep pipeline" could look shallow quickly.
There is also a concentration risk in TMX's own strategy. The Cboe acquisition depends on regulatory approvals in Canada and Australia and on successful integration of two different venue models. AlphaX US enters a crowded U.S. ATS battleground against established players with deeper liquidity. And TMX's caution on prediction markets means the company is deliberately sitting out one of the industry's hottest revenue pools.
The falsifying signal for the optimistic case is specific and observable: if TSX new issuers fail to build on the August 2026 level over the next two quarters — that is, if monthly new listings fall back below 15 while the U.S. IPO pipeline stays open — the Canadian recovery would be exposed as a one-deal phenomenon rather than a broadening trend. A second falsifying signal would be TMX's revenue mix: if the share of revenue generated outside Canada stops climbing, the structural-diversification thesis loses its strongest support.
What to Watch
In the short term, the key data points are TMX's monthly equity financing statistics and the number of Canadian companies that price IPOs in the final quarter of 2026. A steady cadence of mid-sized listings, not just one blockbuster, would confirm the pipeline is real. The September 2026 numbers, due in early October, will be the first read on whether August's strength held.
Over the medium term, the Cboe Australia and Cboe Canada transaction's progress through regulatory review, and early signs of AlphaX US market traction, will show whether TMX's U.S. expansion is executing. The company's quarterly revenue mix — how much comes from outside Canada — is the single best indicator of whether the structural shift is continuing.
Three scenarios frame the outlook. In the base case, Canadian IPO activity continues to recover gradually, tracking U.S. windows, while TMX's non-Canadian businesses keep revenue growing in the low-to-mid teens. In the upside case, a broadening of Canadian issuance beyond ETFs and mining, combined with successful Cboe integration, lifts both the listings narrative and the earnings multiple. In the downside case, U.S. IPO windows narrow in 2027, Canadian issuance stalls, and the Cboe deal faces regulatory delays — leaving TMX dependent on its trading and data businesses to carry growth.
In the long run, the question is whether Canada can build a listings market that does not need U.S. permission to function. TMX's answer, effectively, is to stop waiting: it is building revenue streams that work regardless of what happens on Bay Street.
The Canadian IPO market is recovering, but TMX has already moved on. The company that lists Canadian companies is no longer the company investors are buying.
Explore more exclusive insights at nextfin.ai.
