After years in which rapid expansion was rewarded almost unconditionally, growth software is entering a more demanding phase. Investors are no longer impressed by headline percentages alone. Higher capital costs and tighter valuation frameworks are forcing a reassessment of what “quality growth” actually means in practice.
The focus is shifting toward durability. Companies that can sustain elevated revenue growth while gradually improving margins stand out from those riding temporary cycles. In 2026, the winners are unlikely to be the fastest growers on paper, but those capable of turning scale into operating leverage as market conditions normalize.
Top points of the analysis
Revenue and ARR growth remains around 30%, well above the pace of most of the software market.
The increased full-year outlook confirms management's confidence in the evolution of demand.
Recurring revenues create high predictability for future quarters.
Gross margins above 75% indicate strong, yet underutilized…