- 3Q25 software sector revenue grew 16% YoY (vs. 12% in 3Q24), while Adj. PATMI rose 23% YoY. Microsoft’s 18% YoY revenue growth contributed 11ppt to overall sector growth, offsetting slower CRM growth amid macro headwinds.
- ERP stayed strong as Oracle and SAP delivered 34% and 26% YoY cloud growth. Cybersecurity remained resilient, with CrowdStrike and Palo Alto Networks growing revenue 22% and 16% amid GenAI adoption.
- For 4Q25e, consensus expects software revenue to grow 16% YoY, driven by Microsoft, cloud infrastructure, and cybersecurity. ERP and security momentum should continue on sustained cloud migration and rising adoption of AI-driven security solutions.
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