| Study Period | 2019 - 2030 |
| Market Size (2025) | USD 0.40 Trillion |
| Market Size (2030) | USD 1.44 Trillion |
| CAGR (2025 - 2030) | 29.11 % |
| Fastest Growing Market | Asia Pacific |
| Largest Market | North America |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Software As A Service Market Analysis
The Software As A Service Market size is estimated at USD 0.40 trillion in 2025, and is expected to reach USD 1.44 trillion by 2030, at a CAGR of 29.11% during the forecast period (2025-2030).
- SaaS platforms are increasingly leveraging AI and machine learning to enhance features, automate processes, and deliver personalized user experiences. Vertical SaaS solutions cater to specific industries, addressing their unique challenges and requirements. A notable 89% of executives foresee vertical SaaS as the future, underscoring a trend towards specialized software solutions.
- As remote work becomes the norm, there's a heightened demand for SaaS tools that bolster collaboration, project management, and communication, with platforms like Zoom, Slack, and Asana leading the charge. In response to rising costs, many SaaS companies are venturing into innovative pricing models, such as consumption-based pricing, which charges customers based on their usage rather than a standard flat fee.
- No-code and low-code platforms are democratizing software development, enabling users to craft and customize applications without deep programming expertise. This trend is projected to dominate nearly 65% of all app development by 2024 as per industry experts.
- iPaaS solutions are becoming indispensable for businesses juggling multiple software applications, ensuring smooth integration and communication across diverse tools. The surging demand for collaboration software is driving the SaaS market. Notably, companies fostering collaborative work environments are five times more likely to excel. Supporting this, a Stanford survey highlighted that employees, on average, dedicate 27% of their full-time workdays to remote tasks.
- However, challenges loom in the market. Storing sensitive data in the cloud brings forth security breach concerns and compliance challenges with regulations like GDPR and HIPAA, underscoring the necessity for robust security measures.
- Post-pandemic, as organizations embraced remote work, the appetite for collaboration tools (such as Zoom, Microsoft Teams, and Slack), project management software (like Asana and Trello), and cloud-based solutions surged. Businesses increasingly sought specialized SaaS solutions, like telehealth platforms in healthcare, to tackle their distinct challenges. Furthermore, the drive for efficiency led SaaS providers to weave in AI and automation features, helping businesses streamline workflows and minimize manual tasks.
Software As A Service Market Trends
BFSI to Hold Significant Growth
- As banks strive to cut costs and accelerate their digital transformation, the adoption of cloud technology has surged. In 2024, nearly three-quarters (72%) of IT executives at banks, as surveyed by The Economist Intelligence Unit, acknowledged that integrating cloud solutions into their offerings is pivotal for achieving business goals. Furthermore, about 82% of these banking IT leaders have articulated a clear strategy for cloud technology adoption.
- Banks are not only looking to upgrade their existing self-hosted solutions—whether on-premise, in private clouds, or public clouds—but are also contemplating a shift to Software as a Service (SaaS). This transition promises banks a host of advantages: access to mature managed services, robust SaaS security and compliance measures, and the ability to streamline budgets towards a singular SaaS licensing subscription.
- Recognizing the competitive edge and innovative potential that public cloud deployments offer—thanks to their scalability, agility, and cost benefits—banks are keen to embrace them. Yet, as regulated entities, banks must navigate the maze of regulatory standards concerning cloud services. One viable route is partnering with a SaaS provider that boasts comprehensive certifications like SOC 2 and the ISO 27k series, and offers proactive security measures including monitoring and incident resolution.
- According to Capgemini, a staggering 91% of banks and insurance firms have embarked on their cloud journey, a leap from just 37% in 2020. This shift underscores the importance of migrating core internal systems to cloud-enabled platforms, especially to harness the full potential of AI and generative AI.
- There's a trend towards faster time-to-market (TTM) facilitated by SaaS partnerships. The Open API sandbox within a SaaS ecosystem accelerates the rollout of agile products. As APIs take center stage in SaaS innovations, they empower banks to seamlessly integrate with diverse applications, bolstering their offerings with embedded finance solutions.
Understand The Key Trends Shaping This Market
Download PDF
North America to Hold Significant Share
- North America's demand for Software as a Service (SaaS) is surging, fueled by digital transformation initiatives, the rise of remote work, and technological advancements.
- In the United States, ensuring HIPAA compliance for SaaS means the software must adhere to all relevant Security Rule standards. Moreover, the software should have features that can be tailored to help end-users meet HIPAA requirements. While most developers creating eHealth apps for personal use may overlook HIPAA compliance, SaaS providers and hosting companies must prioritize the administrative, technical, and physical safeguards outlined in the HIPAA Security Rule.
- The U.S. dominates the global SaaS landscape, boasting approximately 17,000 SaaS companies. Notably, over 80% of U.S. businesses utilize at least one SaaS application to streamline their operations. As of January 2024, Salesforce stands out as the largest SaaS entity on the U.S. Stock Exchange.
- According to Cloud Eagle, organizations typically allocate between USD 1,000 and USD 3,500 annually per employee for SaaS applications. Furthermore, a notable 71% of organizations express strong confidence in investing in AI-driven software in the near future.
- In terms of funding, U.S. SaaS and enterprise software firms secured a total of USD 17.4 billion in 2023, spread across 880 funding rounds, from seed to growth-stage capital. As of May 2024, VC funding for U.S. SaaS companies in 2024 reached USD 4.7 billion over 282 rounds. Given these trends, the region is poised for significant growth in the coming years.
Get Analysis on Important Geographic Markets
Download PDF
Software As A Service Industry Overview
The Software as a Service market is highly competitive and fragmented, primarily driven by the presence of major players. These key players employ strategies such as mergers, acquisitions, and product innovations to maintain a competitive edge and broaden their global footprint. Key player include Microsoft Corporation, Salesforce Inc., and others.
The SaaS market is poised for substantial growth driven by technological advancements and changing consumer behaviors. Key trends such as AI integration, vertical SaaS specialization, and the rise of low-code development platforms will continue to shape the industry landscape in 2024 and beyond. As businesses adapt to these trends, they will increasingly focus on customer-centric strategies and innovative pricing models to maintain competitiveness in an evolving digital environment.
Software As A Service Market Leaders
-
Microsoft Corporation
-
Salesforce Inc.
-
Oracle Corporation
-
SAP SA
-
IBM Corporation
- *Disclaimer: Major Players sorted in no particular order
Need More Details on Market Players and Competiters?
Download PDF
Software As A Service Market News
- July 2024: Sileon announced the introduction of a new feature now available within its comprehensive SaaS solution. This new solution module is designed to promote responsible lending and offer better-tailored offers for cardholders. It also provides enhanced flexibility and convenience for both businesses and end users.
- June 2024: Earnix, one of the prominent player in AI-based SaaS solutions for financial services, has announced a collaboration with NTT Data to deliver cloud-based intelligent solutions for pricing, rating, underwriting, and policy personalisation to top property and casualty insurance carriers.
Software As A Service Industry Segmentation
Software as a service is a cloud computing service model where the provider offers use of application software to a client and manages all needed physical and software resources. The revenue generation cater through models such as subscription mode, freemium model, use based pricing, and add-on services.
The software as a service market is segmented by deployment (public cloud, private cloud, hybrid cloud), enterprises (SMEs, large enterprises), end-user verticals (IT and telecom, BFSI, retail, healthcare, manufacturing, other end-user verticals), geography (North America, Europe, Asia-Pacific, Latin America, Middle East and Africa). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
| By Deployment | Public Cloud |
| Private Cloud | |
| Hybrid Cloud | |
| By Enterprise | SMEs |
| Large Enterprises | |
| By End-user Vertical | IT and Telecom |
| BFSI | |
| Retail | |
| Healthcare | |
| Manufacturing | |
| Other End-user Verticals | |
| By Geography*** | North America |
| Europe | |
| Asia | |
| Australia and New Zealand | |
| Latin America | |
| Middle East and Africa |
Need A Different Region or Segment?
Customize Now
Software As A Service Market Research FAQs
How big is the Software As A Service Market?
The Software As A Service Market size is expected to reach USD 0.40 trillion in 2025 and grow at a CAGR of 29.11% to reach USD 1.44 trillion by 2030.
What is the current Software As A Service Market size?
In 2025, the Software As A Service Market size is expected to reach USD 0.40 trillion.
Who are the key players in Software As A Service Market?
Microsoft Corporation, Salesforce Inc., Oracle Corporation, SAP SA and IBM Corporation are the major companies operating in the Software As A Service Market.
Which is the fastest growing region in Software As A Service Market?
Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2025-2030).
Which region has the biggest share in Software As A Service Market?
In 2025, the North America accounts for the largest market share in Software As A Service Market.
What years does this Software As A Service Market cover, and what was the market size in 2024?
In 2024, the Software As A Service Market size was estimated at USD 0.28 trillion. The report covers the Software As A Service Market historical market size for years: 2019, 2020, 2021, 2022, 2023 and 2024. The report also forecasts the Software As A Service Market size for years: 2025, 2026, 2027, 2028, 2029 and 2030.
Software As A Service Industry Report
Statistics for the 2025 Software As A Service market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Software As A Service analysis includes a market forecast outlook for 2025 to 2030 and historical overview. Get a sample of this industry analysis as a free report PDF download.
