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U.S. Software Industry Analysis

UpdatedJun 21, 2026
DataAggregated Company Financials
Companies438
  • 7D-2.0%
  • 3M3.5%
  • 1Y-17.7%
  • YTD-15.8%

Over the last 7 days, the Software industry has dropped 2.0%, driven by a pullback from Microsoft of 2.9%. In contrast, Nebius Group has gained 23%. Overall the industry is down 18% in 12 months. 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
Sun, 21 Jun 2026US$5.8tUS$698.5bUS$156.5b25.5x36.9x8.3x
Tue, 19 May 2026US$6.2tUS$685.9bUS$154.9b27.8x39.8x9x
Thu, 16 Apr 2026US$5.5tUS$667.8bUS$161.5b29.7x34.3x8.3x
Sat, 14 Mar 2026US$5.8tUS$669.3bUS$161.4b27.8x35.9x8.7x
Mon, 09 Feb 2026US$5.7tUS$662.4bUS$162.0b26.9x35x8.6x
Wed, 07 Jan 2026US$7.0tUS$648.9bUS$165.0b32.7x42.2x10.7x
Fri, 05 Dec 2025US$7.1tUS$641.7bUS$161.9b31.4x43.9x11.1x
Sun, 02 Nov 2025US$7.8tUS$636.9bUS$158.3b34.9x49.3x12.3x
Tue, 30 Sep 2025US$7.7tUS$620.9bUS$151.9b35.1x51x12.5x
Thu, 28 Aug 2025US$7.4tUS$615.8bUS$150.8b35.1x48.8x11.9x
Sat, 26 Jul 2025US$7.5tUS$597.2bUS$130.9b45.7x57.5x12.6x
Mon, 23 Jun 2025US$7.0tUS$599.0bUS$131.1b40.7x53.5x11.7x
Wed, 21 May 2025US$6.8tUS$591.1bUS$131.4b36.1x51.4x11.4x
Fri, 18 Apr 2025US$5.5tUS$580.5bUS$131.7b30x41.9x9.5x
Sun, 16 Mar 2025US$5.9tUS$582.9bUS$131.2b28.1x44.7x10.1x
Tue, 11 Feb 2025US$6.5tUS$586.3bUS$132.4b42.9x49x11.1x
Thu, 09 Jan 2025US$6.4tUS$569.1bUS$129.0b39x49.3x11.2x
Sat, 07 Dec 2024US$6.8tUS$566.7bUS$128.2b43.4x52.9x12x
Mon, 04 Nov 2024US$6.0tUS$561.9bUS$126.3b39x47.5x10.7x
Wed, 02 Oct 2024US$6.0tUS$551.7bUS$124.1b38.4x48.8x11x
Fri, 30 Aug 2024US$5.7tUS$551.3bUS$122.0b37.8x47x10.4x
Sun, 28 Jul 2024US$5.8tUS$532.0bUS$117.8b40.7x49x10.8x
Tue, 25 Jun 2024US$5.9tUS$531.3bUS$118.0b40.7x50.1x11.1x
Thu, 23 May 2024US$5.4tUS$474.6bUS$105.3b42.5x51.4x11.4x
Sat, 20 Apr 2024US$5.1tUS$466.6bUS$98.4b42x51.9x10.9x
Mon, 18 Mar 2024US$5.3tUS$471.0bUS$98.1b45.8x54.4x11.3x
Wed, 14 Feb 2024US$5.3tUS$464.6bUS$90.2b41.8x58.8x11.4x
Fri, 12 Jan 2024US$5.2tUS$486.2bUS$82.2b45.8x63.3x10.7x
Sun, 10 Dec 2023US$5.1tUS$485.6bUS$82.5b47.1x61.3x10.4x
Tue, 07 Nov 2023US$4.7tUS$481.3bUS$79.0b43x58.9x9.7x
Thu, 05 Oct 2023US$4.4tUS$477.3bUS$73.4b44.8x60.6x9.3x
Sat, 02 Sep 2023US$4.6tUS$475.8bUS$72.6b44.8x63.4x9.7x
Mon, 31 Jul 2023US$4.6tUS$466.2bUS$64.9b47.7x70.8x9.9x
Wed, 28 Jun 2023US$4.4tUS$460.6bUS$62.3b44.2x71.2x9.6x
Price to Earnings Ratio

71.2x


Total Market Cap: US$4.4tTotal Earnings: US$62.3bTotal Revenue: US$460.6bTotal Market Cap vs Earnings and Revenue0%0%0%
U.S. Software Industry Price to Earnings3Y Average 51x202420252026
Current Industry PE
  • Investors are pessimistic on the American Software industry, indicating that they anticipate long term growth rates will be lower than they have historically.
  • The industry is trading at a PE ratio of 36.9x which is lower than its 3-year average PE of 51.0x.
  • The 3-year average PS ratio of 10.6x is higher than the industry's current PS ratio of 8.3x.
Past Earnings Growth
  • The earnings for companies in the Software industry have grown 36% per year over the last three years.
  • Revenues for these companies have grown 15% 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 Market1.39%
Tech3.28%
Software-1.96%
Systems Software-1.69%
Application Software-2.63%
Industry PE
  • Investors are most optimistic about the Application Software industry which is trading above its 3-year average PE ratio of 53.1x.
    • Analysts are expecting annual earnings growth of 27.8%, which is higher than its past year's earnings growth of 10.2% per year.
  • Investors are most pessimistic about the Systems Software industry, which is trading below its 3-year average of 39.0x.
Forecasted Growth
  • Analysts are most optimistic on the Application Software industry, expecting annual earnings growth of 28% over the next 5 years.
  • This is better than its past earnings growth rate of 10% per year.
  • 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
NBIS Nebius GroupUS$286.6923.4%
+US$13.9b		497.6%PE99.8x
PANW Palo Alto NetworksUS$287.782.9%
+US$6.7b		44.4%PE278.3x
CIFR Cipher DigitalUS$29.1819.1%
+US$1.9b		669.9%PS56.9x
WULF TeraWulfUS$28.9811.2%
+US$1.4b		674.9%PS85.4x
PLTR Palantir TechnologiesUS$128.470.4%
+US$1.2b		-6.4%PE135x

Latest News

CIFR
US$29.18
Cipher Digital
7D
19.1%
1Y
669.9%
Seeking Alpha • 4h

Cipher Digital: $11.4B Backlog Built For Hyperscale

Summary Cipher Digital has pivoted from Bitcoin mining to a hyperscale HPC platform, securing three long-term leases totaling 700 MW contracted capacity. Q1 2026 headline revenue decline reflects planned mining wind-down; the core story is $11.4B in contracted revenue and a visible $787M average annualized NOI ramp. Capital structure is derisked by $5.2B in project-level non-recourse debt, $715M unrestricted cash, and a new $200M undrawn corporate revolver with major banks. We rate CIFR a Buy with a $40 price target (~30% upside), anchored on contracted NOI and pipeline option value, while monitoring tenant concentration and ERCOT batch 0 risks. Read the full article on Seeking Alpha
PLTR
US$128.47
Palantir Technologies
7D
0.4%
1Y
-6.4%
Analysis Article • Jun 20

Palantir Technologies (PLTR) Stock Could Be 20% Overvalued Even If Growth Stays Strong

Palantir Technologies (PLTR) continues to attract attention as investors assess its position in data analytics and AI software, with the stock recently closing at $128.47 and a market value of about $308b. See our latest analysis for Palantir Technologies. Recent trading in Palantir Technologies has been choppy, with the share price down 6.5% over the past month and 14.7% over 90 days. The year to date share price return has declined 23.5%, while the three year total shareholder return...
HUT
US$124.44
Hut 8
7D
4.7%
1Y
645.1%
WULF
US$28.98
TeraWulf
7D
11.2%
1Y
674.9%
Analysis Article • Jun 19

TeraWulf (WULF) Stock Could Be 11% Overvalued After Bank Of America Starts Coverage

Bank of America’s decision to initiate coverage on TeraWulf (WULF), highlighting its shift toward high performance computing and AI infrastructure projects such as Lake Mariner and the Muskie Data Campus, has put the stock firmly on investors’ radar. See our latest analysis for TeraWulf. Recent interest in TeraWulf has coincided with sharp price momentum, including a 4.02% 1 day share price return, 33.98% 30 day share price return and a 91.92% 90 day share price return. Over 1 year the total...
NOW
US$95.04
ServiceNow
7D
-7.0%
1Y
-51.1%
Seeking Alpha • Jun 19

ServiceNow: The AI Threat Is Overstated

Summary ServiceNow has been down because the market thinks agentic AI will vaporize its seat-based licensing revenue. Wall Street is missing the fact that >50% of net new ACV is already driven by non-seat consumption pricing, proving the structural pivot is working while growth accelerates. You are getting a hyper-efficient compounder at its cheapest multiple in public history (~21x FY26 adjusted EPS) for a clear asymmetric long opportunity. Read the full article on Seeking Alpha
MSFT
US$379.40
Microsoft
7D
-2.9%
1Y
-20.5%
Analysis Article • Jun 19

Microsoft (MSFT) Stock Could Be 18.6% Undervalued After China AI Push and Copilot Reset

Microsoft (MSFT) is back in focus after two linked moves: rapid expansion of its Azure hosted OpenAI services in China and a reset of Copilot Cowork pricing and underlying AI models. See our latest analysis for Microsoft. Despite a long list of AI partnerships and new products like Copilot Cowork, Microsoft’s recent share price performance has been weak, with the stock down 19.8% year to date on a share price basis and total shareholder return declining 20.4% over the past year. However,...
WDAY
US$116.93
Workday
7D
-10.6%
1Y
-50.9%
Analysis Article • Jun 19

Workday (WDAY) Stock Could Be 32% Below Fair Value on Its AI Narrative

Workday (WDAY) has been drawing investor attention after a prolonged pullback, with the stock down 4% over the past day and about 14% over the past 3 months. This has sharpened focus on its fundamentals. See our latest analysis for Workday. Over the past year, Workday has seen momentum fade, with the share price down 43.18% year to date and the 1 year total shareholder return declining 50.91%. This points to a shift in how investors are weighing its growth prospects against perceived...
ADBE
US$195.16
Adobe
7D
-4.3%
1Y
-48.2%
CRM
US$151.78
Salesforce
7D
-8.5%
1Y
-41.8%
MSTR
US$112.53
Strategy
7D
-9.2%
1Y
-69.6%
Seeking Alpha • Jun 18

Strategy And Its Preferreds: Maybe Later, But I'm Not Now Willing To Bet On Genius

Summary I liked Strategy (MSTR) as a bitcoin HODL (Hold On for Dear Life) “intelligent leverage” play that outperformed bitcoin by regularly increasing bitcoin held per common share. I also liked two of its preferred issues; STRK because convertibility softened MSTR’s volatility and STRC, because its dividend would fluctuate to whatever level would keep the stock near $100. I respect MSTR’s top execs as very smart guys, perhaps even geniuses. But as MSTR evolves, I’m recalling the 2000 book, “When Genius Failed.” MSTR isn’t in danger now, but... I’m seeing red flags. MSTR seems to be relying much on unreliable past performance. And I now see a lot of complexity which I deem a negative investment factor. I’m not completely giving up here. I respect management’s intelligence, creativity and its intense desire to openly communicate. But things are still evolving. For now, I’d rather be a spectator. Read the full article on Seeking Alpha
CDNS
US$387.39
Cadence Design Systems
7D
0.6%
1Y
31.1%
Narrative Update • Jun 17

CDNS: Agentic AI And Digital Twins Will Drive Future Upside

Analysts have raised their fair value estimate for Cadence Design Systems to $440 from $418, citing higher assumed revenue growth, slightly stronger profit margins, and ongoing enthusiasm for the company's AI driven tools and digital twin opportunity, as reflected in recent Street price target increases. Analyst Commentary Recent research on Cadence Design Systems highlights a cluster of bullish analysts raising price targets, pointing to what they view as a supportive backdrop for valuation as the company leans into AI powered tools and industrial digital twins.
NBIS
US$286.69
Nebius Group
7D
23.4%
1Y
497.6%
Narrative Update • Jun 17

NBIS: Contracted AI Megadeals And Heavy Spending Will Pressure Future Returns

Nebius Group's analyst fair value estimate has been lifted from $85.00 to $120.00, as analysts point to higher price targets driven by stronger compute demand, a more valuable software stack, and recent quarters that they describe as clean with solid demand signals. Analyst Commentary Recent research on Nebius Group highlights a mix of enthusiasm around the business model and growing compute demand, alongside a more restrained view on how much upside the current Nebius stock valuation offers in the near term.
INTU
US$267.00
Intuit
7D
-3.5%
1Y
-64.9%
PANW
US$287.78
Palo Alto Networks
7D
2.9%
1Y
44.4%
Analysis Article • Jun 16

Palo Alto Networks (PANW) Stock Valuation After Strong AI Driven Q3 Results And Optimistic Guidance

Palo Alto Networks (PANW) is back in focus after reporting fiscal third quarter earnings, pairing strong revenue growth with a quarterly net loss and issuing optimistic guidance that leans heavily on rising AI driven cybersecurity demand. See our latest analysis for Palo Alto Networks. The earnings beat and upbeat guidance have come alongside strong market interest, with a 68.18% 3 month share price return and a 360.25% 5 year total shareholder return suggesting momentum has been strong over...
APP
US$469.71
AppLovin
7D
-5.4%
1Y
44.7%
Narrative Update • Jun 13

APP: AI Advertising Rollout And Buybacks Will Support Further Upside

Analysts now set a slightly higher price target for AppLovin at $648.10, compared with the prior $646.86. The adjustment is tied to updated fair value estimates, discount rate assumptions, revenue growth expectations, profit margin outlook, and a projected future P/E of 30.99x.
HQ
US$32.00
Horizon Quantum Holdings
7D
193.3%
1Y
122.2%
New Narrative • Jun 12

Horizon Quantum Holdings (HQ) presents a compelling, if high-risk, thesis for a 2x valuation over the next two years.

Horizon Quantum Holdings (HQ) presents a compelling, if high-risk, thesis for a 2x valuation over the next two years. While the company is currently in a "trough" characterized by negative earnings and the volatility typical of a recent SPAC debut, its structural position as a hardware-agnostic software layer could prove indispensable as the quantum industry matures.