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ANNUAL REPORT

SEG 2026 Annual SaaS Report

How AI & Buyer Priorities Are Defining SaaS in 2026

SEG’s 2026 Annual SaaS Report combines analysis of more than 100 publicly traded companies in the SEG SaaS Index™ with a review of nearly 2,700 SaaS M&A transactions completed in 2025. Across both public and private markets, the results reinforce what buyers reward most today: durable growth and retention, plus products that are deeply embedded in workflows and data. Companies that can mitigate AI risk while leveraging it within their platform are increasingly positioned for stronger outcomes.

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The Top 3 Highlights

2,698
Total SaaS M&A Deals in 2025

SaaS M&A activity reached its highest level on record in 2025 and accounted for approximately 58% of total software M&A activity.

72%
AI-Referenced SaaS Deals in 2025

AI-referenced targets accounted for approximately 72% of all SaaS M&A transactions in 2025, reflecting rapid growth in AI-focused deal activity and highlighting how quickly AI has become embedded across the SaaS landscape.

9.1%
Median EBITDA Margin

Median EBITDA margins across the SEG SaaS Index™ increased to 9.1% in 2025, marking a clear step-change in profitability as public SaaS companies reached record scale and operating efficiency.

Comprehensive Insights from the SEG SaaS Index™

The public market section of the report analyzes performance, financial metrics, and valuation trends across more than 100 publicly traded SaaS companies included in the SEG SaaS Index™. Updated quarterly, the Index reflects changes in the SaaS landscape driven by acquisitions, IPOs, and evolving business models, providing a consistent benchmark for evaluating public SaaS performance over time. For software executives, the Index serves as a guiding reference for market trends, buyer priorities, and the characteristics that consistently drive value, rather than a direct valuation benchmark.

In 2025, results within the Index reflected meaningful dispersion, with performance concentrated among the upper quartile of companies. While the broader Index declined, the top quartile delivered approximately 6% YoY gains, driven by companies tied to mission-critical workflows, data infrastructure, and AI enablement. This performance reinforces investor preference for SaaS businesses that combine durable growth with strategic relevance.

Notable Public SaaS Companies

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SEG SaaS Index™ EV/Revenue by Product Category

Several SaaS categories continued to command strong valuation premiums in 2025 as enterprises increased investment in software required to support AI adoption and core enterprise operations. Analytics & Data Management was the only product category to expand YOY, with its median EV/TTM revenue multiple increasing 11%, reflecting demand for platforms central to enterprise data architectures. DevOps & IT Management and ERP & Supply Chain remained among the highest-valued categories, ending 2025 at 6.9x and 6.7x, supported by mission-critical platforms such as Cloudflare, Datadog, ServiceNow, Oracle, SAP, and Descartes. Security also maintained premium valuations, with leaders including CrowdStrike, Zscaler, Palo Alto Networks, and Rubrik benefiting from sustained enterprise investment in protecting data, infrastructure, and AI-enabled workflows.

EV/Revenue by Product Category
Quarterly Medians
4Q24
1Q25
2Q25
3Q25
4Q25
SEG SaaS Index
6.3x
6.4x
5.3x
5.2x
4.8x
Analytics & Data Management
3.4x
4.0x
3.5x
3.3x
4.5x
ERP & Supply Chain
9.1x
8.5x
8.4x
7.7x
6.7x
Financial Applications
8.2x
8.1x
7.6x
6.2x
5.3x
Security
9.7x
7.9x
7.3x
7.2x
6.3x
Vertically Focused
6.0x
6.8x
5.8x
4.9x
4.6x
4Q24
SEG SaaS Index
6.3x
Analytics & Data Management
3.4x
ERP & Supply Chain
9.1x
Financial Applications
8.2x
Security
9.7x
Vertically Focused
6.0x
1Q25
SEG SaaS Index
6.4x
Analytics & Data Management
4.0x
ERP & Supply Chain
8.5x
Financial Applications
8.1x
Security
7.9x
Vertically Focused
6.8x
2Q25
SEG SaaS Index
5.3x
Analytics & Data Management
3.5x
ERP & Supply Chain
8.4x
Financial Applications
7.6x
Security
7.3x
Vertically Focused
5.8x
3Q25
SEG SaaS Index
5.2x
Analytics & Data Management
3.3x
ERP & Supply Chain
7.7x
Financial Applications
6.2x
Security
7.2x
Vertically Focused
4.9x
4Q25
SEG SaaS Index
4.8x
Analytics & Data Management
4.5x
ERP & Supply Chain
6.7x
Financial Applications
5.3x
Security
6.3x
Vertically Focused
4.6x
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Recapping SaaS M&A Activity

In 2025, SaaS M&A activity reached its highest level on record with 2,698 transactions, supported by strong and consistent quarterly volume throughout the year. Deal activity increased 28% YoY from 2,107 transactions in 2024, reflecting improving buyer confidence and sustained demand for high-quality software assets. SaaS transactions accounted for approximately 58% of total software M&A activity, consistent with recent years and near all-time highs, as absolute deal volume continued to rise alongside broader software and AI-related M&A expansion. Activity remained elevated across all quarters in 2025, underscoring the durability of SaaS as a core driver of overall software M&A.

SaaS M&A Deal Volume

Annual
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SaaS M&A Activity Across Product Categories in 2025

Analytics & Data Management and Content & Workflow Management were the two most active SaaS M&A product categories in 2025, together accounting for nearly 38% of total SaaS deal volume for the year. Activity across both categories was driven by buyer demand for software embedded in core workflows, with Analytics & Data Management benefiting from increased investment in data infrastructure and AI-enabled decision making.

Sales & Marketing also remained an active SaaS M&A category throughout 2025, with deal volume peaking at 100 transactions in 3Q25 before moderating to 73 transactions in 4Q25. Consistent activity across the year reflects continued buyer interest in platforms that support customer acquisition, engagement, and revenue generation.

Content & Workflow Management
Analytics & Data Management
Sales & Marketing
Business Management
Financial Applications
Human Capital Management

Content & Workflow Management

Quarterly SaaS M&A

Analytics & Data Management

Quarterly SaaS M&A

Sales & Marketing

Quarterly SaaS M&A

Business Management

Quarterly SaaS M&A

Financial Applications

Quarterly SaaS M&A

Human Capital Management

Quarterly SaaS M&A
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Strategic Buyers and Private Equity Shape SaaS M&A

SaaS M&A transactions are evaluated based on acquirer backing, which we categorize into Strategic Buyers and Private Equity Investors. In 2025, private equity buyers were involved in nearly 58% of all SaaS transactions, making it one of the most sponsor-heavy years on record, while strategic buyers accounted for 48% of deals. Conversely, buyers with any strategic angle, regardless of backing, comprised approximately 92% of all transactions, underscoring that strategic outcomes are driving most M&A volume.

SaaS M&A Activity by Buyer Type

2025
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Insights to Drive Stronger Software M&A Performance

Market-Maps (1)
browser_updated guide

Interactive Market Maps

SaaS-Index
browser_updated guide

SEG SaaS Index Page

SEG-Deal-Database
browser_updated guide

SEG SaaS M&A Deal Database™ Tool

Archived Reports

If you are looking for a past version of SEG’s Annual or Quarterly Reports, you can now download all previously published reports from our archived section.

Annual
2025 ANNUAL REPORT
2024 ANNUAL REPORT
2023 ANNUAL REPORT
2022 ANNUAL REPORT
2021 ANNUAL REPORT
Quarterly
3Q25 QUARTERLY REPORT
2Q25 QUARTERLY REPORT
1Q25 QUARTERLY REPORT
3Q24 QUARTERLY REPORT
2Q24 QUARTERLY REPORT
1Q24 QUARTERLY REPORT
3Q23 QUARTERLY REPORT
2Q23 QUARTERLY REPORT
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2026 SaaS M&A and Public Market Report

2026-SaaS-Annual-Report-Download

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