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U.S. Software Industry Analysis

UpdatedJan 12, 2026
DataAggregated Company Financials
Companies433
  • 7D1.6%
  • 3M-9.9%
  • 1Y12.3%
  • YTD1.9%

The Software industry is up 1.6% in the last week, with Microsoft up 1.4%. This means that the industry has gained 12% 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
Mon, 12 Jan 2026US$7.1tUS$648.9bUS$165.0b32.7x42.8x10.9x
Wed, 10 Dec 2025US$7.3tUS$642.0bUS$161.3b32.7x45.4x11.4x
Fri, 07 Nov 2025US$7.6tUS$639.2bUS$158.7b33.5x47.7x11.8x
Sun, 05 Oct 2025US$7.8tUS$621.4bUS$151.8b35.7x51.4x12.5x
Tue, 02 Sep 2025US$7.4tUS$616.6bUS$150.8b35.9x49x12x
Thu, 31 Jul 2025US$7.6tUS$598.4bUS$131.2b43.9x57.9x12.7x
Sat, 28 Jun 2025US$7.3tUS$599.0bUS$131.2b42x55.5x12.2x
Mon, 26 May 2025US$6.6tUS$593.0bUS$131.7b35.3x50.3x11.2x
Wed, 23 Apr 2025US$5.3tUS$580.3bUS$131.7b29.6x40.5x9.2x
Fri, 21 Mar 2025US$5.9tUS$582.8bUS$131.2b29.7x45x10.1x
Sun, 16 Feb 2025US$6.6tUS$588.2bUS$130.3b42.1x50.6x11.2x
Tue, 14 Jan 2025US$6.3tUS$569.1bUS$129.3b38.9x48.4x11x
Thu, 12 Dec 2024US$6.7tUS$568.6bUS$128.6b43x52.2x11.8x
Sat, 09 Nov 2024US$6.4tUS$567.3bUS$127.0b40.6x50.3x11.3x
Mon, 07 Oct 2024US$6.0tUS$551.7bUS$124.1b38.8x48.1x10.8x
Wed, 04 Sep 2024US$5.8tUS$550.8bUS$122.1b37.3x47.8x10.6x
Fri, 02 Aug 2024US$5.7tUS$541.3bUS$120.1b39.7x47.6x10.6x
Sun, 30 Jun 2024US$6.0tUS$531.0bUS$118.1b40.5x50.5x11.2x
Tue, 28 May 2024US$5.4tUS$475.9bUS$105.9b40.6x50.7x11.3x
Thu, 25 Apr 2024US$5.2tUS$466.6bUS$98.4b43.2x52.6x11.1x
Sat, 23 Mar 2024US$5.5tUS$465.8bUS$98.0b45x55.8x11.7x
Mon, 19 Feb 2024US$5.3tUS$465.3bUS$90.9b42.7x58.3x11.4x
Wed, 17 Jan 2024US$5.3tUS$486.2bUS$82.2b46.2x64.1x10.8x
Fri, 15 Dec 2023US$5.1tUS$486.1bUS$82.9b48.5x62x10.6x
Sun, 12 Nov 2023US$4.8tUS$482.1bUS$79.1b44.3x61.1x10x
Tue, 10 Oct 2023US$4.5tUS$477.3bUS$73.4b45.4x62x9.5x
Thu, 07 Sep 2023US$4.6tUS$476.0bUS$72.7b44.7x63.8x9.7x
Sat, 05 Aug 2023US$4.5tUS$473.0bUS$68.4b47.4x65.8x9.5x
Mon, 03 Jul 2023US$4.5tUS$460.6bUS$62.2b45.3x72.4x9.8x
Wed, 31 May 2023US$4.3tUS$458.4bUS$61.6b41.4x70.3x9.5x
Fri, 28 Apr 2023US$4.0tUS$457.8bUS$62.2b42x64.3x8.7x
Sun, 26 Mar 2023US$3.8tUS$453.7bUS$59.8b42.3x63.9x8.4x
Tue, 21 Feb 2023US$3.6tUS$437.4bUS$58.1b42.9x61.7x8.2x
Thu, 19 Jan 2023US$3.3tUS$434.5bUS$60.2b40.1x54.6x7.6x
Price to Earnings Ratio

54.6x


Total Market Cap: US$3.3tTotal Earnings: US$60.2bTotal Revenue: US$434.5bTotal Market Cap vs Earnings and Revenue0%0%0%
U.S. Software Industry Price to Earnings3Y Average 54.9x202420252026
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 42.8x which is lower than its 3-year average PE of 54.9x.
  • 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 40% 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 Market1.24%
Tech0.016%
Software1.62%
Application Software1.73%
Systems Software1.56%
Industry PE
  • Investors are most optimistic about the Application Software industry which is trading above its 3-year average PE ratio.
    • Analysts are expecting annual earnings growth of 24.2%, which is lower than the prior year's growth of 41.1% per year.
  • Investors are most pessimistic about the Systems Software industry, which is trading close to its 3-year average of 40.2x.
Forecasted Growth
  • Analysts are most optimistic on the Application Software industry, expecting annual earnings growth of 24% over the next 5 years.
  • However this is lower than its past earnings growth rate of 41% per year.
  • In contrast, the Systems Software industry is expected to see its earnings grow by 17% 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$479.281.4%
+US$47.8b		14.9%PE34x
ORCL OracleUS$198.523.1%
+US$17.0b		29.0%PE37x
PLTR Palantir TechnologiesUS$177.492.0%
+US$8.2b		173.1%PE386.2x
CDNS Cadence Design SystemsUS$327.318.7%
+US$7.1b		11.9%PE84x
SNPS SynopsysUS$525.186.3%
+US$5.9b		7.7%PE75.2x

Latest News

ORCL
US$198.52
Oracle
7D
3.1%
1Y
29.0%

ORCL: AI Infrastructure Demand And Data Center Buildout Will Drive Future Upside

Analysts have trimmed their price targets on Oracle, cutting our fair value estimate by about US$51 to US$291.08. They are factoring in concerns around the concentration of recent RPO growth in the OpenAI commitment, higher investment needs that may pressure margins, and a lower future P/E multiple, despite still robust expectations for cloud and AI driven revenue growth.
DDOG
US$125.49
Datadog
7D
-6.1%
1Y
-9.1%
INTU
US$646.90
Intuit
7D
2.8%
1Y
3.8%

INTU: OpenAI Deal And Tax Shifts Will Support Future AI Agents

Analysts have trimmed their fair value estimate for Intuit by about US$6 to roughly US$797 per share. This reflects slightly lower long term revenue growth and P/E assumptions, even as recent research highlights mixed views on near term tax momentum, Credit Karma upside, and the OpenAI partnership.
ADSK
US$276.02
Autodesk
7D
-4.4%
1Y
-3.1%

ADSK: AI And Execution Will Support Multi Year Outperformance Versus Core Industries

Analysts have made a slight adjustment to the Autodesk fair value estimate to about $365.71 per share. The change reflects recent price target increases on the Street, renewed confidence in execution and AI and go to market plans, and expectations that the company can grow several points faster than its core industries over the next few years.
CDNS
US$327.31
Cadence Design Systems
7D
8.7%
1Y
11.9%
BMNR
US$30.06
Bitmine Immersion Technologies
7D
-9.9%
1Y
398.6%
PANW
US$189.02
Palo Alto Networks
7D
3.8%
1Y
12.6%

PANW: AI Security And M&A Integration Will Drive Future Share Gains

Narrative Update: Palo Alto Networks Price Target Shift Analysts have nudged their fair value estimate for Palo Alto Networks to US$227.60 from US$224.53. This reflects slightly adjusted assumptions around discount rate, growth, margins, and future P/E in light of mixed research views that balance concerns on decelerating sales and acquisition pricing with continued interest in the company's role in security, observability, and AI driven opportunities.
MSFT
US$479.28
Microsoft
7D
1.4%
1Y
14.9%
SNPS
US$525.18
Synopsys
7D
6.3%
1Y
7.7%

SNPS: AI Alliance And NVIDIA Stake Will Reframe Earnings And Legal Risks

Analysts have raised their price target for Synopsys to reflect updated assumptions around a slightly lower discount rate, modestly adjusted revenue growth, a higher projected profit margin of 15.55%, and a revised future P/E of 91.08x. Taken together, these factors point to a recalibrated risk and earnings profile for the stock.
APP
US$647.72
AppLovin
7D
2.3%
1Y
105.2%
ZS
US$216.73
Zscaler
7D
-2.7%
1Y
16.2%

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

Analysts have nudged our Zscaler fair value estimate higher to about US$389 from US$385, reflecting a blend of slightly softer modeled revenue growth, modestly better margin expectations, and updated price targets that balance mixed ARR disclosure with continued confidence in emerging product traction and long term Zero Trust and AI security demand. Analyst Commentary Street research around the latest quarter paints a largely constructive picture, with price targets moving in both directions but commentary skewing toward confidence in Zscaler's execution on growth initiatives, especially in Zero Trust, AI Security, and Data Security offerings.
NOW
US$141.80
ServiceNow
7D
-3.9%
1Y
-30.2%
QBTS
US$28.11
D-Wave Quantum
7D
-8.3%
1Y
633.9%
PLTR
US$177.49
Palantir Technologies
7D
2.0%
1Y
173.1%
TEAM
US$146.42
Atlassian
7D
-4.8%
1Y
-38.0%

TEAM: Cloud Partnership Progress And Share Repurchases Will Shape Balanced Long-Term Outlook

Analysts have reduced their fair value estimate for Atlassian from $178.00 to $167.44. The revision reflects updated views on its revenue growth assumptions, profit margin outlook, discount rate and future P/E expectations.
MSTR
US$157.33
Strategy
7D
-4.5%
1Y
-52.1%