By Thomas Tisone, Vice President | Published 29th October 2026
Software valuation benchmarks rose again in Q3 2026, with the median company in Silverpeak’s dataset up 8% on EV/Revenue, to 3.88x. Silverpeak LLP tracks 528 listed software companies in the US and Europe through S&P Capital IQ. Q2 earnings eased investor concerns about AI, and multiples climbed through to late August on evidence of AI adoption. September gave part of that back after the Fed’s first rate rise since 2023 and renewed AI competition concerns weighed on high-growth software stocks. Multiples remain below prior-year levels in most categories.
Quarterly findings
Every percentile expanded in Q3, with the top decile up 9% and the median up 8%. Only the 25th percentile trades above its level a year ago, up 10%, as lower-multiple companies had less growth premium to lose when the AI debate compressed valuations from late 2025.
Software EV/Revenue multiples by percentile
| Percentile | EV/Revenue | QoQ | YoY |
|---|---|---|---|
| 90th percentile | 9.62x | +9% | -17% |
| 75th percentile | 5.85x | +3% | -11% |
| 50th percentile (median) | 3.88x | +8% | -11% |
| 25th percentile | 2.51x | +5% | +10% |
Source: S&P Capital IQ. Data as of 30 September 2026.
US SaaS and US Horizontal led the categories, with EV/Revenue up 12% and 11% QoQ to 5.10x and 4.00x. Enterprise was the strongest sector, up 14% on both EV/Revenue and EV/EBITDA, after results from large vendors such as Salesforce showed their AI products and agents adding revenue. US Vertical moved the other way, down 8% QoQ to 4.06x, as September’s sell-off reversed its August peak.
Security held its Q2 gains and is the only sector trading above prior-year levels, up 11% YoY on EV/Revenue at 4.63x. It was also the only sector to see multiple expansion in September, helped by reports of cyber incidents involving frontier AI agents and expectations of higher cybersecurity spending.
Take-private activity continues, with sponsors paying premiums for high-quality software assets. Broader deal activity stays suppressed, as longer-term uncertainty weighs on investor confidence.
What this means for the market
The two-tier market persists, but the dividing line has moved. Premium valuations now favour businesses with proprietary data, embedded workflows or regulatory barriers that shield them from AI disruption, while generic SaaS multiples keep compressing. Private equity is still deploying capital, though investors treat perceived AI vulnerability as a hygiene factor that can end a process, and sellers are increasingly commissioning AI diligence before launching a process. Strategic buyers continue to favour acquiring proven software over building it, with earn-outs and milestone payments bridging valuation gaps. Sellers that held back in H1 are returning, with process launches building into Q4 and H1 2027.
More from Silverpeak
The US premium to Europe widened on EV/Revenue to 0.7x from 0.5x but narrowed on EV/EBITDA to 3.5x from 4.7x as European multiples rose 14%.
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, read our Q2 2026 analysis of software rebounding as near-term AI fears partially subside.