CEOs Double Down on AI and Deals as Macroeconomic Confidence Lags
U.S. chief executives are pouring resources into artificial intelligence and dealmaking while staying cautious on the broader economy, based on KPMG's 2026 U.S. CEO Outlook Pulse Survey.
Confidence is strong at the company and industry level, but softer at the macro level. 86% are confident in their industry's growth and 83% in their own companies. That confidence drops to 55% for the U.S. economy and 53% for the global outlook over the next year.
AI Spending Accelerates-With a Shift From Pilots to Operations
Leaders see AI as a long-term driver. 77% say generative AI was overhyped in the past year, yet underhyped for its 5-10 year impact.
Capital is following conviction. Nearly 80% of CEOs are investing at least 5% of total capital budgets in AI, and 41% are allocating 10%+. Top priorities: workforce upskilling, faster innovation cycles, and deeper integration of AI into core operations.
Early use cases are clear-supply chain planning, cybersecurity, and productivity. But the bigger prize comes from embedding AI into operating frameworks and new business models, not just tools on the side.
Deal Activity: Expect a Busier 2026
Growth is not on pause. 63% of CEOs expect to pursue mergers, acquisitions, or strategic partnerships in 2026.
Supply chains are being rewired in parallel. Over 70% made strategic adjustments in the past year to improve agility, including using AI for trade compliance and tariff mitigation.
Cybersecurity Moves to the Top of the Agenda
As AI adoption scales, threat surfaces expand. 67% of CEOs plan to increase cybersecurity investment, citing AI-assisted attacks.
Top risks: AI-powered malware, data privacy breaches, and AI-enabled phishing. More than half also flagged quantum computing as a future threat that could impact cryptography and data protection.
Talent and Leadership: Build Skills, Redesign Work
Talent is the constraint. 61% are concerned about recruiting specialized AI expertise.
Two-thirds (67%) say they only have an initial understanding of how AI will reshape jobs and career paths. Most have not fully redefined roles yet.
On the leadership front, 44% are piloting programs to equip managers with AI-related capabilities. Leaders are also cautious about overreliance on AI reducing critical thinking and early-career learning opportunities.
What This Means for Your 2026 Plan
- Capital allocation: Commit a durable AI investment band (5-10%+ of capital budgets), with a clear split across data infrastructure, model deployment, workforce upskilling, and productization.
- From pilots to profit: Select two end-to-end use cases per function (e.g., forecast-to-fulfill, detect-to-respond in security). Industrialize them with product teams, SLAs, and clear P&L impact.
- Operating model: Stand up AI governance, model risk management, and value-tracking. Shift from one-off tools to platform capabilities reusable across business units.
- Workforce design: Build a skills taxonomy, redesign roles around AI copilots, and deploy continuous learning. Pair redeployment plans with clear change narratives.
- M&A posture: Build a deal pipeline focused on data assets, AI platforms, and capability acqui-hires. Update diligence to cover data rights, model IP, security posture, and integration of AI stacks.
- Supply chain agility: Use AI for trade compliance automation, dynamic tariff strategies, and demand-supply sensing. Stress-test critical nodes and diversify suppliers with data-driven scenarios.
- Security uplift: Increase spend on identity, data protection, and AI threat detection. Run AI-enabled red teaming and begin a roadmap for post-quantum cryptography.
- Metrics that matter: Track cycle time reductions, cost-to-serve, revenue lift from AI features, model reliability, and adoption rates-reported quarterly at the exec level.
Survey Scope
Findings are based on insights from 100 CEOs of U.S.-based companies with annual revenues above $500 million. More than one-third lead firms generating over $10 billion annually.
Where to Build Capability Next
If you're formalizing AI strategy, governance, and transformation skills at the top team level, explore the AI Learning Path for CEOs.
The signal is clear: despite economic uncertainty, executives are pushing forward on AI and strategic deals to protect margins, create new revenue, and stay competitive. The advantage goes to leaders who move from experiments to scaled execution-fast and repeatable.
Your membership also unlocks:
