BigLaw is having a big year.

A new Citi report has clocked 11.7% revenue growth across law firms in the first half of 2026. What’s driving it, you ask? Demand growth that’s considered “rare” for the industry.

“It’s rare we see above 3.5% demand growth,” said Daniel Greenfield, director of Citi’s law firm advisory group. Historic demand growth usually sits closer to 1.5% to 2%.

Demand was up 4.2% industry-wide in H1. By tier:

Expenses are rising too. Industry-wide, total expenses grew 9.7%, with compensation up 8.9%. The Am Law 50 felt it harder: 10.7% expense growth and 12.6% overhead growth, both outpacing the industry average.

AI spend is also ramping up. Firms spent 0.11% of revenue on AI at the end of 2024. By the end of 2025, that had more than doubled to 0.25%.

“It’s still small, but it’s more than double what it was in 2024,” Greenfield said. “It’s really accelerating, and we think that number is increasing in 2026.”

M&A is the big one.

Both mega deals and middle-market matters are firing, with lower mid-market deals reportedly bouncing back more quickly than the mid-market and the upper mid-market.

Litigation has been “solid” too, but Greenfield says deal work is “the primary story.”

Here in Australia, the M&A engine is firing just as hard.

HSF Kramer’s latest Dealmakers report found $36bn in assets transacted via private M&A in 2025, up from just $14bn in 2014, with billion-dollar deals making up a growing share of the action. Mallesons’ recent public M&A report clocked $29.3bn across 20 deals in H1 2026 alone, with mining dominating at 11 of those 20.

“We anticipate it is going to be a strong year for the industry despite the expense pressures,” Greenfield said.

Source: Citi, Law.com, Bloomberg Law