Beaten Down IPOs Face ‘Negative Feedback Loop’ After Lock-Ups

The worst-performing 2025 IPOs face a potential “negative feedback loop” as lock-up periods expire post-earnings, according to PwC’s US listing practice head. Insider selling restrictions will lift, risking further stock declines. Long-term investors and executives—previously barred from selling—may now offload shares, exacerbating downward pressure on already struggling stocks. This could trigger panic among retail investors. The timing aligns with post-earnings reports, amplifying volatility. Weak financial results paired with unlocked shares may accelerate sell-offs, deepening losses for underperforming firms. Analysts warn the cycle could self-perpetuate: falling prices prompt more selling, which further depresses valuations, trapping companies in a downward spiral. The trend highlights broader IPO market fragility, where 2025’s cohort—hit by economic uncertainty—now faces structural risks beyond initial public offering hype.