Silverpeak’s Software Benchmark report is the quarterly valuation and operating-metric benchmark produced by Silverpeak LLP, the boutique European technology investment bank. This edition analyses public software companies across the US and Europe, drawn from a dataset of 528 companies screened via S&P Capital IQ.
Software valuation benchmarks partially rebounded in Q2 2026 as strong Q1 earnings shifted investor sentiment from pessimism to selective optimism on AI’s impact on software business models. The quarterly gain was broadly consistent across sectors and regions, though multiples are still significantly down year on year and private-market deal activity stays subdued. Whether this marks the start of a full recovery will depend on the outcome of several more earnings cycles
Quarterly key findings
- US SaaS posted the strongest category gain, with EV/Revenue up 26% QoQ. Q1 earnings showed AI revenue streams are proving additive rather than cannibalistic, supporting the thesis that AI can expand the revenue of software incumbents, at least in the near term. May was the best month for US software stocks since 2001, but all categories still trade well below prior-year levels; companies will likely need several positive earnings cycles before the market gains conviction on AI’s longer-term effect on software platforms.
- Security was the standout sector, up 42% QoQ on EV/Revenue. In April, frontier AI-security models launched in partnership with incumbent cybersecurity vendors rather than in competition with them, repositioning the sector as an AI beneficiary. Security also led on EV/EBITDA, up 34% both QoQ and YoY, the only sector in positive year-on-year territory on that measure.
- Take-private activity continues for high-quality assets, but broader deal volume remains low. European software private-equity deal activity fell to its lowest level since 2020, as longer-term uncertainty weighs on valuations and many sellers choose to hold rather than accept a discounted process.
Category EV/Revenue multiples
| Category | EV/Revenue | QoQ | YoY |
|---|---|---|---|
| US SaaS | 4.57x | +26% | −37% |
| US Vertical | 4.40x | +15% | −38% |
| US Horizontal | 3.60x | +14% | −20% |
| Europe | 3.24x | +21% | −8% |
What this means for the market
The market has split into two tiers: premium assets seen as AI winners or genuinely defensible command full valuations, while the remainder have re-rated in line with broader public markets. AI has also reset the build-versus-buy equation; capabilities that once justified bolt-on M&A can increasingly be built in-house, thinning the strategic buyer pool to those pursuing genuine transformation rather than incremental extension.
More from Silverpeak
The valuation gap between US and European software narrowed further this quarter, from a 41% US premium a year ago to 16% today. Silverpeak advises technology growth companies on both sides of that market: see our track record in software transactions and our work across the software sector. For the prior quarter’s picture, read our Q1 2026 analysis of software under pressure amid AI disruption.
The full report includes regional and sector breakdowns, quartile analysis, Rule of 40 correlation and methodology. Download it below.