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U.S. Software Industry Analysis

UpdatedJun 25, 2026
DataAggregated Company Financials
Companies433
  • 7D-4.3%
  • 3M6.3%
  • 1Y-23.9%
  • YTD-19.3%

Over the last 7 days, the Software industry has dropped 4.3%, driven by a pullback from Microsoft of 3.7%. However, the industry is down 24% over the past year. Earnings are forecast to grow by 20% annually.

Industry Valuation and Performance

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

DateMarket CapRevenueEarningsPEAbsolute PEPS
Thu, 25 Jun 2026US$5.6tUS$698.4bUS$156.5b26.1x35.6x8x
Sat, 23 May 2026US$6.2tUS$687.1bUS$155.3b28.4x39.7x9x
Mon, 20 Apr 2026US$5.9tUS$668.1bUS$157.3b29.7x37.7x8.9x
Wed, 18 Mar 2026US$5.8tUS$669.4bUS$161.5b29.4x35.8x8.6x
Fri, 13 Feb 2026US$5.7tUS$660.0bUS$163.5b26.7x34.7x8.6x
Sun, 11 Jan 2026US$7.1tUS$648.9bUS$165.0b32.7x42.8x10.9x
Tue, 09 Dec 2025US$7.3tUS$641.9bUS$162.0b32x45.1x11.4x
Thu, 06 Nov 2025US$7.6tUS$637.6bUS$159.0b35.2x48x12x
Sat, 04 Oct 2025US$7.8tUS$621.4bUS$151.8b35.7x51.6x12.6x
Mon, 01 Sep 2025US$7.4tUS$616.6bUS$150.8b35.9x49x12x
Wed, 30 Jul 2025US$7.6tUS$597.5bUS$130.9b46.9x57.8x12.7x
Fri, 27 Jun 2025US$7.2tUS$599.0bUS$131.1b42x55x12x
Sun, 25 May 2025US$6.6tUS$593.0bUS$131.7b35.3x50.3x11.2x
Tue, 22 Apr 2025US$5.5tUS$580.5bUS$131.7b29.7x41.7x9.4x
Thu, 20 Mar 2025US$5.9tUS$582.8bUS$131.2b29x44.6x10x
Sat, 15 Feb 2025US$6.6tUS$588.2bUS$130.3b42.1x50.6x11.2x
Mon, 13 Jan 2025US$6.3tUS$569.1bUS$129.3b38.8x48.3x11x
Wed, 11 Dec 2024US$6.8tUS$567.9bUS$128.8b43.1x52.8x12x
Fri, 08 Nov 2024US$6.3tUS$563.0bUS$127.1b40.6x49.2x11.1x
Sun, 06 Oct 2024US$6.0tUS$551.7bUS$124.1b38.8x48.1x10.8x
Tue, 03 Sep 2024US$5.8tUS$550.8bUS$122.1b38.9x47.8x10.6x
Thu, 01 Aug 2024US$5.7tUS$540.7bUS$120.1b40.4x47.6x10.6x
Sat, 29 Jun 2024US$6.0tUS$531.0bUS$118.1b40.5x50.7x11.3x
Mon, 27 May 2024US$5.4tUS$475.8bUS$105.8b42.2x50.8x11.3x
Wed, 24 Apr 2024US$5.2tUS$466.5bUS$98.4b42.4x52.6x11.1x
Fri, 22 Mar 2024US$5.4tUS$465.8bUS$98.0b45.4x55.6x11.7x
Sun, 18 Feb 2024US$5.3tUS$465.3bUS$90.9b42.7x58.3x11.4x
Tue, 16 Jan 2024US$5.3tUS$486.2bUS$82.2b46.2x64.1x10.8x
Thu, 14 Dec 2023US$5.1tUS$485.6bUS$82.5b49.3x61.9x10.5x
Sat, 11 Nov 2023US$4.7tUS$482.1bUS$79.1b44.3x59.8x9.8x
Mon, 09 Oct 2023US$4.5tUS$477.3bUS$73.4b45.1x61.5x9.5x
Wed, 06 Sep 2023US$4.6tUS$475.8bUS$72.6b44.8x63.9x9.8x
Fri, 04 Aug 2023US$4.5tUS$466.9bUS$66.7b45.6x66.9x9.5x
Sun, 02 Jul 2023US$4.5tUS$460.6bUS$62.2b45.3x72.4x9.8x
Price to Earnings Ratio

72.4x


Total Market Cap: US$4.5tTotal Earnings: US$62.2bTotal Revenue: US$460.6bTotal Market Cap vs Earnings and Revenue0%0%0%
U.S. Software Industry Price to Earnings3Y Average 50.9x202420252026
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 35.6x which is lower than its 3-year average PE of 50.9x.
  • The 3-year average PS ratio of 10.6x is higher than the industry's current PS ratio of 8.0x.
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 Market-2.47%
Tech-4.47%
Software-4.29%
Application Software-3.80%
Systems Software-4.48%
Industry PE
  • Investors are most optimistic about the Application Software industry which is trading above its 3-year average PE ratio of 54.9x.
    • Analysts are expecting annual earnings growth of 27.1%, 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 38.9x.
Forecasted Growth
  • Analysts are most optimistic on the Application Software industry, expecting annual earnings growth of 27% 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
PANW Palo Alto NetworksUS$285.261.1%
+US$2.6b		39.6%PE275.8x
SNPS SynopsysUS$463.931.8%
+US$1.6b		-6.4%PE114.9x
RBRK RubrikUS$74.527.6%
+US$1.1b		-17.7%PS10.8x
FTNT FortinetUS$145.280.8%
+US$835.2m		40.1%PE54.5x
ADBE AdobeUS$196.570.7%
+US$560.5m		-48.9%PE10.8x

Latest News

NBIS
US$259.66
Nebius Group
7D
-7.6%
1Y
435.2%
ADBE
US$196.57
Adobe
7D
0.7%
1Y
-48.9%
RBRK
US$74.52
Rubrik
7D
7.6%
1Y
-17.7%
ZS
US$127.27
Zscaler
7D
2.3%
1Y
-59.2%
Narrative Update • Jun 24

ZS: AI Security And Zero Trust Leadership Will Drive Long Term Upside

Analysts have made a small upward adjustment to the Zscaler fair value estimate, to $246.04 from $245.26, reflecting mixed but generally constructive research that highlights the company as a leading Zero Trust security provider in a still-developing market, despite recent cuts to several Street price targets. Analyst Commentary Street research on Zscaler reflects a split view, with several firms trimming price targets after the latest guidance while still emphasizing the company’s position in Zero Trust security and multi-product adoption across secure access, data security, and AI-focused offerings.
ORCL
US$157.53
Oracle
7D
-14.2%
1Y
-25.2%
CRWD
US$673.02
CrowdStrike Holdings
7D
-1.5%
1Y
36.2%
Narrative Update • Jun 23

CRWD: Future Returns Will Reflect AI Security Inflection And Lofty Expectations

Analysts have nudged the fair value estimate for CrowdStrike Holdings slightly higher to about $712, with updated models reflecting modestly stronger revenue growth, margins, and AI driven ARR guidance. This has pushed many Street price targets into the $700 to $825 range, even as some highlight valuation constraints.
SNPS
US$463.93
Synopsys
7D
1.8%
1Y
-6.4%
Narrative Update • Jun 23

SNPS: Ansys Integration And AI Chip Workflows Will Drive Next Phase

Synopsys' updated analyst price target edges lower to about $560 from roughly $560 previously, even as analysts highlight improving intellectual property trends, potential benefits from Ansys integration, and a clearer medium term product roadmap as key supports for the valuation. Analyst Commentary Recent Street research on Synopsys points to a mixed but generally supportive stance, with several firms revising price targets higher and a few highlighting execution risks and valuation questions.
PLTR
US$113.50
Palantir Technologies
7D
-11.7%
1Y
-21.3%
Seeking Alpha • Jun 23

Palantir: This Selloff Is A Gift

Summary Palantir Technologies Inc. faces near-term pressure from European government contract losses, macro headwinds, and sector-wide selling, but I will reiterate my Buy rating. PLTR’s long-term thesis remains intact, with 11 consecutive quarters of revenue acceleration and unmatched Rule of 40 score that will not weaken given its defensible AI platform. Valuation concerns have eased; PLTR stock trades at 87x FY26 PE, compressing to 39x FY28, with 52–100% potential upside to Wall Street’s “average” and “high” price targets. I am scaling into PLTR in tranches, viewing the selloff as a buying opportunity, while managing downside risk to the $70/share “low” Wall Street price target. Read the full article on Seeking Alpha
CDNS
US$372.40
Cadence Design Systems
7D
-3.9%
1Y
22.6%
Seeking Alpha • Jun 23

Cadence Design Systems: The Market Is Paying Up, But The Earnings Path Still Works

Summary I rate Cadence Design Systems a Buy with a $460 price target, reflecting 37% upside potential from the current level of $379. My growth drivers are agentic AI inside core EDA, semiconductor IP tied to memory and interconnect, SDA after Hexagon, and steady EPS support from buybacks and acquisition accretion. I assume these growth drivers can support the EPS to move from the current $7.90 to a 2028 adjusted EPS estimate of $10.07. I arrive at my price target by applying the 5-year forward non-GAAP P/E average multiple to my 2028 adjusted EPS estimate of $10.07. The main risk is valuation sensitivity because CDNS is already priced as a premium company, but I believe the backlog, management’s projected 17% revenue growth, strong margins, and AI-driven design demand still support the Buy rating. Read the full article on Seeking Alpha
PANW
US$285.26
Palo Alto Networks
7D
1.1%
1Y
39.6%
Narrative Update • Jun 23

PANW: AI Security And Acquisition Synergies Will Shape Measured Repricing Prospects

The analyst price target for Palo Alto Networks has been raised by about $10 to $310. Analysts point to strong Q3 execution across revenue and annual recurring revenue, rising AI driven security demand, and continued confidence in the company’s platform and acquisition contributions as key supports for higher valuation assumptions.
MSFT
US$365.46
Microsoft
7D
-3.7%
1Y
-26.5%
MSTR
US$94.13
Strategy
7D
-16.4%
1Y
-75.6%
FTNT
US$145.28
Fortinet
7D
0.8%
1Y
40.1%
Narrative Update • Jun 22

FTNT: AI Security Demand And Data Center Investments Will Drive Future Upside

Analysts have raised the Fortinet fair value estimate by about $21 to $161.85, citing broadly strong Q1 performance, a pipeline that includes SASE and adjacent markets, and management commentary around AI driven demand and data center investments as key supports for higher price targets across the Street. Analyst Commentary Recent research on Fortinet points to a cluster of higher fair value estimates and price targets, with many bullish analysts highlighting execution in core firewall offerings, momentum in SASE and adjacent markets, and increasing interest around AI driven security use cases.
IREN
US$50.30
IREN
7D
-16.1%
1Y
283.7%
AUR
US$6.23
Aurora Innovation
7D
3.0%
1Y
17.8%
Analysis Article • Jun 19

Aurora Innovation (AUR) Stock Could Be 35.8% Undervalued After Craig Hallum Buy Initiation

Craig-Hallum’s decision to initiate coverage of Aurora Innovation (AUR) has put fresh attention on the autonomous trucking specialist, as investors weigh its physical AI focus and Aurora Driver technology against ongoing R&D spending and market risks. See our latest analysis for Aurora Innovation. Aurora Innovation’s recent 3.8% 1 day share price return and 5.2% 7 day share price return sit against a 30 day decline of 9.5%. At the same time, the 90 day share price return of 52.1% and 3 year...
VRNS
US$37.29
Varonis Systems
7D
12.7%
1Y
-25.6%
Narrative Update • Jun 11

VRNS: AI Data Security Tailwinds Will Meet Rising Platform Competition Risks

Analysts have raised their average price targets on Varonis Systems by a mid single digit dollar range, citing growing interest in data security exposure as AI tools like Copilot expand, while still highlighting competitive and platform consolidation risks. Analyst Commentary Street research on Varonis points to a mixed setup, with interest in data security demand from AI tools like Copilot balanced against questions around competition and platform durability.