Uncertainty will continue to define the year ahead according to CEOs from across the globe.

CEOs are more confident in their own companies’ prospects than they are in the outlook for the global economy, EY-Parthenon CEO Outlook Survey, a quarterly survey of 1,200 global CEOs across 21 countries, found CEOs are more confident in their own companies’ prospects than they are in the outlook for the global economy.

The survey’s CEO Confidence Index – a measure from 1 to 100 that quantifies CEO sentiment globally across a wide range of business dimensions – shows that overall CEO sentiment has dipped from 83.0 (Q3 2025) to 78.5 (Q4 2025).

This decline in sentiment is reflective of growing uncertainty towards today’s business landscape – a landscape characterized by growing geopolitical tensions, persistent volatility, a muted global economic forecast, supply-chain disruption, rising cost pressures and slowing activity in major markets.

Janet Truncale, EY Global Chair and CEO, said: “Today’s most successful CEOs are confident in their ability to operate under uncertainty, acting boldly to embrace new technologies at speed and foster confident collaboration to gain competitive advantage. In the year ahead, business leaders need to execute decisively and intentionally by scaling innovation, investing in talent and working closely within their organization and across industries to create new value.”

Despite persistent external headwinds, CEOs surveyed remain confident in their ability to strengthen performance from within. Nine in 10 CEO respondents expect revenue growth and productivity gains to support profitability in 2026, even if 61% anticipate increases in operating costs.

EY said the confidence is powered by investments being made into talent and technology transformation, with CEOs recognizing that one-off change isn’t enough and are driving continuous, proactive transformation to sustain growth. Forty percent of respondents are prioritizing improving customer engagement and retention amid shifting consumer behaviour, and 37% are concentrating on innovating products and processes.

The survey showed that CEOs are more willing and able to act amid uncertainty. They are more likely to accelerate investments in response to geopolitical or trade policy developments (40%) than delay (31%) or stop (10%) investment activity. Forty-three percent of CEOs cited optimizing operations and improving productivity, including artificial intelligence (AI) and digitalization, as their top priority for the year ahead in adapting to a shifting economic environment.

2026 is expected to be a turning point for AI investments, as CEOs shift from piloting technologies to scaling them across their organizations to accelerate transformation. AI adoption is evolving from a bolt on to a built-in foundation of business models, with 58% of surveyed leaders expecting AI to be a major growth engine in the next two years, while 32% believe it will fundamentally reshape operations as they scale these technologies enterprise-wide.

Almost all CEOs surveyed have begun (52%) or are planning to begin (45%) significant transformation initiatives this year in a bid to extract value and growth. CEOs are increasingly regarding AI as a dependable enabler of productivity, revenue growth, customer experience and efficiency for the year ahead. Nevertheless, many are yet to unlock AI’s full potential, with only 20% reporting that AI has significantly exceeded expectations over the last year.

Andrea Guerzoni, Global Vice Chair EY-Parthenon, explained: “Despite the hype around outsized AI gains, the reality for CEOs is much more complex. AI is meeting and somewhat exceeding expectations for many CEOs, but only a standout 20% are capturing breakthrough returns, and they will be in a strong position to forge ahead, making AI more of an engine than an experiment.”

M&A is expected to remain a key pillar for CEOs, with many respondents pursuing acquisitions to accelerate transformation efforts, productivity, digitalization and growth in 2026. While geopolitical scrutiny is reshaping deal strategies, investment appetite remains resilient, but with a growing preference for domestic and regional transactions.

CEOs are increasingly focused on deals that deliver on their priorities including technology, talent and capabilities at speed, balancing ambition with pragmatism in an even more uncertain geopolitical and regulatory environment.

Notably, CEOs are increasingly seeking to meet these objectives through joint ventures and strategic alliances, with 79% of respondents planning initiatives in 2026, compared with 62% in 2025 – unlocking the immediate access to new capabilities and technology through more flexible and less complex deals.

In the next 12 months, 53% of CEO respondents plan to pursue acquisitions specifically aligned to their growth agendas, including digitalization, optimizing operations, improving productivity, and accelerating growth. This represents a 5% increase from Q3 2025, showing that CEOs are moving proactively and driving sharper decision-making to help deliver growth.

Guerzoni, concluded: “2026 is not going to be a year of certainty, and CEOs know this. The winners will be those who actively rewire their capital allocation, navigate geopolitical complexity and focus on technology-led M&A to fashion flexible, resilient portfolios that are built not only to absorb further potential market shocks, but also to maximize opportunities presented by ongoing market volatility.”