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U.S. Software Industry Analysis

UpdatedJul 01, 2026
DataAggregated Company Financials
Companies433
  • 7D1.1%
  • 3M6.5%
  • 1Y-21.9%
  • YTD-17.2%

Last week, the Software industry hasn't moved much but Palo Alto Networks is up 17% in that time. As for the longer term, the industry has declined 23% in the last year. Looking forward, 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
Wed, 01 Jul 2026US$5.6tUS$697.7bUS$156.3b26.9x36.1x8.1x
Fri, 29 May 2026US$6.1tUS$689.4bUS$155.3b28.5x39.5x8.9x
Sun, 26 Apr 2026US$5.9tUS$668.8bUS$157.2b30.5x37.8x8.9x
Tue, 24 Mar 2026US$5.6tUS$668.3bUS$162.0b29.9x34.6x8.4x
Thu, 19 Feb 2026US$5.6tUS$660.6bUS$164.3b25.8x34x8.5x
Sat, 17 Jan 2026US$6.7tUS$648.9bUS$159.8b31.6x42x10.4x
Mon, 15 Dec 2025US$7.1tUS$645.9bUS$164.8b32.9x43.2x11x
Wed, 12 Nov 2025US$7.5tUS$640.3bUS$158.6b32.5x47.6x11.8x
Fri, 10 Oct 2025US$7.9tUS$621.4bUS$151.7b35.8x52.1x12.7x
Sun, 07 Sep 2025US$7.3tUS$618.2bUS$151.4b35.8x48.4x11.9x
Tue, 05 Aug 2025US$7.6tUS$610.3bUS$147.5b40.4x51.2x12.4x
Thu, 03 Jul 2025US$7.2tUS$598.9bUS$131.3b41.6x55.1x12.1x
Sat, 31 May 2025US$6.7tUS$594.2bUS$131.7b36.8x50.9x11.3x
Mon, 28 Apr 2025US$5.9tUS$581.1bUS$131.9b32x45x10.2x
Wed, 26 Mar 2025US$6.0tUS$582.9bUS$131.0b29.5x46x10.4x
Fri, 21 Feb 2025US$6.6tUS$579.9bUS$129.9b38.3x50.9x11.4x
Sun, 19 Jan 2025US$6.4tUS$569.2bUS$129.3b40.8x49.8x11.3x
Tue, 17 Dec 2024US$6.7tUS$569.1bUS$128.8b41.4x52.3x11.8x
Thu, 14 Nov 2024US$6.5tUS$567.2bUS$126.8b41.9x51.3x11.5x
Sat, 12 Oct 2024US$6.0tUS$551.7bUS$124.1b40.4x48.7x11x
Mon, 09 Sep 2024US$5.6tUS$551.3bUS$123.1b34.9x45.6x10.2x
Wed, 07 Aug 2024US$5.4tUS$541.9bUS$119.2b37.9x45.2x9.9x
Fri, 05 Jul 2024US$6.1tUS$530.5bUS$118.1b41.3x51.6x11.5x
Sun, 02 Jun 2024US$5.1tUS$476.0bUS$106.9b39.8x47.8x10.7x
Tue, 30 Apr 2024US$5.2tUS$476.8bUS$102.7b44.1x50.4x10.9x
Thu, 28 Mar 2024US$5.4tUS$465.8bUS$98.0b45x55.2x11.6x
Sat, 24 Feb 2024US$5.3tUS$466.5bUS$92.9b43.9x57.3x11.4x
Mon, 22 Jan 2024US$5.4tUS$486.2bUS$82.1b46.4x65.6x11.1x
Wed, 20 Dec 2023US$5.2tUS$486.1bUS$82.9b44.3x62.2x10.6x
Fri, 17 Nov 2023US$5.0tUS$482.1bUS$79.5b45.3x62.3x10.3x
Sun, 15 Oct 2023US$4.5tUS$477.3bUS$73.7b44.3x61.3x9.5x
Tue, 12 Sep 2023US$4.7tUS$476.3bUS$73.0b45.4x64.3x9.8x
Thu, 10 Aug 2023US$4.4tUS$473.1bUS$69.0b44.7x63.9x9.3x
Sat, 08 Jul 2023US$4.5tUS$460.7bUS$60.4b47x73.8x9.7x
Price to Earnings Ratio

73.8x


Total Market Cap: US$4.5tTotal Earnings: US$60.4bTotal Revenue: US$460.7bTotal Market Cap vs Earnings and Revenue0%0%0%
U.S. Software Industry Price to Earnings3Y Average 50.7x202420252026
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 35.9x which is lower than its 3-year average PE of 50.7x.
  • 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 37% 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 Market1.92%
Tech2.32%
Software1.08%
Application Software2.62%
Systems Software0.47%
Industry PE
  • Investors are most optimistic about the Application Software industry which is trading above its 3-year average PE ratio of 57.6x.
    • Analysts are expecting annual earnings growth of 26.6%, which is higher than its past year's earnings growth of 10.8% per year.
  • Investors are most pessimistic about the Systems Software industry, which is trading below its 3-year average of 38.8x.
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 11% 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$341.0217.2%
+US$40.8b		72.6%PE329.7x
CRWD CrowdStrike HoldingsUS$763.1412.1%
+US$20.9b		55.1%PS38.1x
APP AppLovinUS$515.2310.3%
+US$16.2b		53.0%PE44.2x
DDOG DatadogUS$260.3618.0%
+US$14.2b		96.8%PE683.1x
PLTR Palantir TechnologiesUS$116.672.8%
+US$7.6b		-11.7%PE122.6x

Latest News

ORCL
US$146.55
Oracle
7D
-11.3%
1Y
-33.1%
ADBE
US$205.02
Adobe
7D
3.8%
1Y
-47.7%
Seeking Alpha • 8h

Adobe: A Strong Business Model That Delivers - A Value Equation Deep Dive

Summary Adobe trades at a historic low of 8.7x trailing free cash flow, despite maintaining double-digit revenue growth and industry-leading 45% operating margins. Adobe's current market equity cash yield exceeds 12%, or better than long-term S&P 500 equity performance and almost 3X current 10-year Treasury Note yields. ADBE's business model delivers a model-estimated 17.3% total return, driven by 12% revenue growth guidance and aggressive buybacks. Sector AI disruption fears are not evident in corporate performance. With robust financial strength, predictable cash flows, and a $25B new buyback authorization, I rate ADBE a buy for long-term compounding at current multiples. Read the full article on Seeking Alpha
MSFT
US$373.02
Microsoft
7D
-0.2%
1Y
-24.2%
Seeking Alpha • 17h

Microsoft: When Uncertainty Rules, Even Attractive Valuations Don't Matter

Summary Deterioration in investors' sentiment towards Microsoft and hyperscalers more broadly is justified given the current level of uncerntainty. While MSFT margins remain robust, there are some early warning signs when it comes to profitability in the cloud segment for FY 2027. The race to the bottom in terms of capital expenditure increases adds another layer of uncertainty to future profitability. At present, MSFT trades at a significant discount on a time-series basis once we account for current margins, but that alone does not justify a Buy rating. Read the full article on Seeking Alpha
CRCL
US$62.63
Circle Internet Group
7D
-17.2%
1Y
-67.5%
Seeking Alpha • Jun 30

Circle: Three Revenue Layers And One Mispriced Stock

Summary Circle Internet Group is undervalued, with market pricing reflecting only reserve income while payments and blockchain protocol segments offer significant upside. CRCL's RLDC margin hit a record 41.4% in Q1 2026, driven by USDC migration from Coinbase and improved distribution economics, despite declining reserve yields. Circle Payments Network transaction volume surged to $10 billion annualized, with 136 financial institutions enrolled, signaling rapid adoption and future margin expansion. Arc blockchain's $222 million presale, backed by leading institutions, positions CRCL for long-term protocol revenue, with current investments masking underlying cash flow strength. Read the full article on Seeking Alpha
PLTR
US$116.67
Palantir Technologies
7D
2.8%
1Y
-11.7%
MSTR
US$86.93
Strategy
7D
-16.3%
1Y
-76.7%
WULF
US$24.70
TeraWulf
7D
-14.2%
1Y
456.3%
SNPS
US$446.07
Synopsys
7D
-3.3%
1Y
-14.5%
CIFR
US$24.50
Cipher Digital
7D
-11.4%
1Y
400.0%
APP
US$515.23
AppLovin
7D
10.3%
1Y
53.0%
FTNT
US$153.62
Fortinet
7D
3.8%
1Y
50.0%
IREN
US$45.73
IREN
7D
-16.4%
1Y
200.3%
DDOG
US$260.36
Datadog
7D
18.0%
1Y
96.8%
CRWD
US$763.14
CrowdStrike Holdings
7D
12.1%
1Y
55.1%
NOW
US$99.28
ServiceNow
7D
3.5%
1Y
-50.9%
Narrative Update • Jun 28

NOW: AI Partnerships And Margin Pressure Will Constrain Long Term Upside

Analysts have revised their fair value estimate for ServiceNow to $85.00. This reflects updated assumptions around the discount rate, revenue growth, profit margin, and future P/E that collectively point to a more conservative price target framework.
PANW
US$341.02
Palo Alto Networks
7D
17.2%
1Y
72.6%