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U.S. Software Industry Analysis

UpdatedAug 27, 2026
DataAggregated Company Financials
Companies426
  • 7D1.6%
  • 3M7.3%
  • 1Y-6.1%
  • YTD2.6%

Over the last 7 days, the Software industry has risen 1.6%, driven by gains from Microsoft of 3.2%. During this same period, the Palo Alto Networks underperformed, falling 5.7%. In the past year, the industry is down 6.1%. Earnings are forecast to grow by 21% annually.

Industry Valuation and Performance

Has the U.S. Software Industry valuation changed over the past few years?

DateMarket CapRevenueEarningsPEAbsolute PEPS
Thu, 27 Aug 2026US$6.8tUS$713.5bUS$138.7b31x49.3x9.6x
Sat, 25 Jul 2026US$5.6tUS$700.4bUS$157.1b27.8x35.7x8x
Mon, 22 Jun 2026US$5.8tUS$698.5bUS$156.5b25.9x36.9x8.3x
Wed, 20 May 2026US$6.2tUS$685.9bUS$154.9b26.7x40x9x
Fri, 17 Apr 2026US$5.8tUS$668.1bUS$157.3b29.1x36.8x8.7x
Sun, 15 Mar 2026US$5.7tUS$669.3bUS$161.5b27.8x35.4x8.5x
Tue, 10 Feb 2026US$5.8tUS$662.5bUS$162.0b28x35.7x8.7x
Thu, 08 Jan 2026US$7.0tUS$648.9bUS$165.0b32.7x42.7x10.9x
Sat, 06 Dec 2025US$7.2tUS$641.9bUS$162.0b31.5x44.3x11.2x
Mon, 03 Nov 2025US$7.8tUS$636.9bUS$158.3b34.9x49.3x12.3x
Wed, 01 Oct 2025US$7.8tUS$621.0bUS$151.9b36.3x51.4x12.6x
Fri, 29 Aug 2025US$7.4tUS$616.1bUS$150.6b34.9x49x12x
Sun, 27 Jul 2025US$7.6tUS$597.2bUS$130.9b45.7x57.8x12.7x
Tue, 24 Jun 2025US$7.1tUS$599.0bUS$131.1b41.8x54.4x11.9x
Thu, 22 May 2025US$6.8tUS$591.7bUS$131.4b35.5x51.4x11.4x
Sat, 19 Apr 2025US$5.5tUS$580.5bUS$131.7b30x41.7x9.4x
Mon, 17 Mar 2025US$5.9tUS$582.9bUS$131.2b28.1x44.7x10.1x
Wed, 12 Feb 2025US$6.6tUS$586.3bUS$132.4b42.9x49.7x11.2x
Fri, 10 Jan 2025US$6.4tUS$569.1bUS$129.0b39.1x49.4x11.2x
Sun, 08 Dec 2024US$6.9tUS$566.7bUS$128.2b43.4x53.5x12.1x
Tue, 05 Nov 2024US$6.0tUS$562.0bUS$126.3b38.4x47.5x10.7x
Thu, 03 Oct 2024US$6.0tUS$551.7bUS$124.1b38.4x48.8x11x
Sat, 31 Aug 2024US$5.8tUS$551.5bUS$122.1b38.3x47.4x10.5x
Mon, 29 Jul 2024US$5.8tUS$532.0bUS$117.8b40.7x49x10.8x
Wed, 26 Jun 2024US$5.9tUS$531.3bUS$118.0b39.5x49.8x11.1x
Fri, 24 May 2024US$5.4tUS$474.8bUS$105.4b41.3x51.4x11.4x
Sun, 21 Apr 2024US$5.0tUS$466.6bUS$98.4b43.1x51.3x10.8x
Tue, 19 Mar 2024US$5.3tUS$466.7bUS$97.8b44.8x54.7x11.5x
Thu, 15 Feb 2024US$5.3tUS$464.6bUS$90.2b42.4x58.8x11.4x
Sat, 13 Jan 2024US$5.3tUS$486.2bUS$82.2b46.2x64.1x10.8x
Mon, 11 Dec 2023US$5.1tUS$485.6bUS$82.5b47.1x61.3x10.4x
Wed, 08 Nov 2023US$4.7tUS$481.2bUS$79.4b43.7x58.8x9.7x
Fri, 06 Oct 2023US$4.4tUS$477.3bUS$73.4b44.7x60x9.2x
Sun, 03 Sep 2023US$4.6tUS$475.8bUS$72.6b44.8x63.4x9.7x
Price to Earnings Ratio

63.4x


Total Market Cap: US$4.6tTotal Earnings: US$72.6bTotal Revenue: US$475.8bTotal Market Cap vs Earnings and Revenue0%0%0%
U.S. Software Industry Price to Earnings3Y Average 49.2x202420252026
Current Industry PE
  • Investors are relatively neutral on the American Software industry at the moment, indicating that they anticipate long term growth rates to remain steady.
  • The industry is trading close to its 3-year average PE ratio of 49.2x.
  • The industry is trading close to its 3-year average PS ratio of 10.6x.
Past Earnings Growth
  • The earnings for companies in the Software industry have grown 24% per year over the last three years.
  • Revenues for these companies have grown 14% per year.
  • This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.

Industry Trends

Which industries have driven the changes within the U.S. Tech industry?

US Market-0.42%
Tech-0.84%
Software1.62%
Systems Software1.93%
Application Software0.77%
Industry PE
  • Investors are most optimistic about the Systems Software industry even though it's trading below its 3-year average PE ratio of 38.2x.
    • Analysts are expecting annual earnings growth of 17.8%, which is lower than the prior year's growth of 20.4% per year.
Forecasted Growth
  • Analysts are most optimistic on the Application Software industry, expecting annual earnings growth of 28% over the next 5 years.
  • This is roughly in line with its past earnings growth rate.
  • In contrast, the Systems Software industry is expected to see its earnings grow by 18% per year over the next few years.

Top Stock Gainers and Losers

Which companies have driven the market over the last 7 days?

CompanyLast Price7D1YValuation
MSFT MicrosoftUS$496.373.2%
+US$113.0b		-2.6%PE27.6x
ORCL OracleUS$148.873.5%
+US$14.6b		-36.9%PE25.2x
PLTR Palantir TechnologiesUS$177.502.0%
+US$8.5b		12.3%PE141.4x
MSTR StrategyUS$123.1918.2%
+US$7.3b		-64.0%PS95x
CDNS Cadence Design SystemsUS$334.686.3%
+US$5.4b		-3.5%PE66.9x

Latest News

MSFT
US$496.37
Microsoft
7D
3.2%
1Y
-2.6%
ZM
US$93.83
Zoom Communications
7D
-12.7%
1Y
15.9%
CRCL
US$89.91
Circle Internet Group
7D
14.4%
1Y
-29.4%
ORCL
US$148.87
Oracle
7D
3.5%
1Y
-36.9%
Seeking Alpha • 22h

Oracle: Why I Am Staying Strong After Q4 2026

Summary I reiterate a Strong Buy on Oracle Corporation with a $185 price target, driven by robust Q4 2026 results and accelerating AI infrastructure momentum. The $638 billion RPO looks more credible than it did eight months ago. The majority of incremental Q4 RPO also came through customer prepayments or bring-your-own-hardware structures. 2027 could mark a major growth inflection. Forward revenue growth of 31.54% is about 151% above the sector median, which tells me ORCL's growth profile is moving well beyond it. The valuation gives me room to stay aggressive. Using a 23x multiple on 2027 non-GAAP EPS guidance of $8.05 gives me a $185 price target. The AI infrastructure thesis is getting stronger. ORCL is adding close to another 1 GW of data center capacity in Q1 2027, which should support another step-up in OCI revenue. Read the full article on Seeking Alpha
MSTR
US$123.19
Strategy
7D
18.2%
1Y
-64.0%
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INTU
US$345.88
Intuit
7D
-4.6%
1Y
-47.8%
New Narrative • Aug 26

Intuit’s Big Bets Are Working — and the Market Is Still Pricing the Old Story

Intuit just closed fiscal 2026 (ended 31 July) with $21.4 billion in revenue, up 14%. GAAP and non-GAAP diluted EPS both rose 20%.
BMNR
US$24.91
Bitmine Immersion Technologies
7D
23.1%
1Y
-45.9%
Seeking Alpha • Aug 25

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Summary Bitmine Immersion Technologies is upgraded to "Buy," driven by a strong technical breakout and robust trading volume. BMNR’s strategy centers on acquiring up to 5% of the Ethereum network, native staking, moonshot investments, and bridging Wall Street with DeFi. Technical indicators—RSI near 80, break above 200-day moving average—signal bullish momentum, with a price target of $36 by the end of 2026. While not fully convinced by fundamentals, BMNR’s resilience and outperformance versus Ether support a positive intermediate-to-long-term outlook. Read the full article on Seeking Alpha
NBIS
US$213.93
Nebius Group
7D
-4.5%
1Y
205.2%
Seeking Alpha • Aug 25

Nebius Is Building Faster Than The Market Realizes

Summary Nebius Group N.V. revenue surged 454%, while AI Cloud EBITDA margin reached 50% and ARR expanded to $3 billion. Short-term capacity commands $40 million to $50 million per megawatt, signaling substantial scarcity and improving pricing power. Nebius targets more than 1 gigawatt of 2027 deployment while customer prepayments should exceed $9 billion during 2026. A $14 billion 2027 revenue scenario at 11x sales supports approximately $500 per diluted NBIS share with successful execution. Read the full article on Seeking Alpha
DDOG
US$227.67
Datadog
7D
-2.5%
1Y
72.8%
Seeking Alpha • Aug 25

Datadog: A Market Winner With Accelerating Growth And Long-Term Tailwinds

Summary Datadog dropped 12% post-earnings, presenting a compelling entry point into a high-growth, leading cloud observability platform. DDOG raised full-year revenue growth guidance to 30% for FY2026, showing robust fundamentals, strong net revenue retention, and expanding product adoption. Stock-based compensation remains high but is declining as a percentage of revenue; dilution is manageable given DDOG's durable growth and financial health. Valuation is steep but justified by secular tailwinds, product innovation, and resilient core business; next quarter's results are pivotal for confirming this outlook. Read the full article on Seeking Alpha
CRWD
US$189.18
CrowdStrike Holdings
7D
-6.2%
1Y
79.1%
Seeking Alpha • Aug 24

CrowdStrike: Excellent Product, Unjustifiable Valuation

Summary CrowdStrike is fundamentally overvalued, trading at a $195B market cap and forward P/E of 155, despite strong revenue growth. CRWD's business model requires perpetual high spending on R&D and marketing, limiting future net margin expansion and undermining bullish operating leverage assumptions. Generative AI accelerates competition, lowering barriers for both startups and tech giants, threatening CRWD’s pricing power and market share. I rate CRWD a Strong Sell, as current valuations price in flawless execution and ignore structural profitability constraints and intensifying competitive risks. Read the full article on Seeking Alpha
PLTR
US$177.50
Palantir Technologies
7D
2.0%
1Y
12.3%
PANW
US$339.31
Palo Alto Networks
7D
-5.7%
1Y
80.9%
Seeking Alpha • Aug 21

Palo Alto Networks: Upcoming Earnings Beat, Valuation Is Crazy

Summary Palo Alto Networks, Inc. is expected to report robust Q4 revenue growth, likely exceeding consensus estimates, driven by strong bookings and Next-Generation Security momentum. Recurring revenue from Next-Generation Security grew 60% last quarter, while remaining performance obligations rose 36%, supporting sustained top-line expansion. Despite consistent earnings beats, EPS growth is constrained by a 15% share count increase, resulting in projected EPS growth of only 5–10%. At ~95x earnings and a PEG ratio near 5, PANW's valuation appears stretched relative to its near-term EPS growth, prompting a neutral stance. Read the full article on Seeking Alpha
WDAY
US$190.75
Workday
7D
-3.9%
1Y
-17.0%
Seeking Alpha • Aug 21

Workday: In Play Ahead Of Q2 Earnings And Amid Potential Buyout

Summary Workday presents an asymmetric risk/reward setup ahead of Q2 earnings, with M&A rumors suggesting a potential go-private deal at a 20-25% premium. A $230-$250 buyout price would value WDAY at $57-$61 billion, reflecting its $10 billion subscription revenue base and 28-30% free cash flow margins. Recent management changes and a series of AI-focused acquisitions point to strategic repositioning, making a go-private transaction with Silver Lake plausible. Options flow and strong revenue stability suggest a price floor near $180, with public sentiment contrarian and upside potential from either earnings or M&A catalysts. Read the full article on Seeking Alpha
ZS
US$170.31
Zscaler
7D
-7.7%
1Y
-37.6%
Narrative Update • Aug 21

ZS: Future Returns Will Rely On AI Security And Zero Trust Adoption

Analysts raised their fair value estimate for Zscaler, increasing the price target from about $193 to $197 as they considered recent target revisions that emphasize AI security, Zero Trust adoption, channel checks, and reseller surveys indicating solid security demand, along with continued debate about growth beyond FY27. Analyst Commentary Recent research on Zscaler shows a split between bullish analysts who emphasize product strength and security demand, and more cautious analysts who focus on execution risk and the medium term growth profile.
FTNT
US$157.54
Fortinet
7D
3.1%
1Y
101.6%
CDNS
US$334.68
Cadence Design Systems
7D
6.3%
1Y
-3.5%
Narrative Update • Aug 13

CDNS: Agentic AI Design Tools And Digital Twins Will Drive Future Upside

Cadence Design Systems' updated analyst price target moved modestly higher, supported by analysts who point to solid Q2 execution, raised guidance, and long term AI related demand drivers, even as questions remain around valuation at roughly a 63x 2027 P/E and the timing of AI monetization. Analyst Commentary Analysts are broadly positive on Cadence Design Systems after Q2, with many lifting price targets and pointing to a mix of AI exposure, strong core electronic design automation demand, and a growing backlog, while a minority remains more measured given the current P/E and open questions on AI monetization and margins.