Gross Margin Benchmarks
Public SaaS Companies — 159 companies tracked
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Gross Margin — Top 20 Companies
Sorted highest to lowest. Dashed line = median.
Gross margin measures the percentage of revenue remaining after direct costs of delivering the product. For SaaS companies, gross margins above 70% are considered healthy; above 80% is exceptional. Below are all 159 companies ranked by gross margin, sourced from the most recent 10-Q or 10-K filing.
Ranked Gross Margin Data
What is Gross Margin?
Gross margin is gross profit — revenue minus cost of goods sold (COGS) — expressed as a percentage of revenue. For SaaS businesses, COGS typically includes hosting infrastructure, customer support, and third-party software costs. It is the most direct indicator of a software product's unit economics.
Formula: Gross Margin = (Revenue − COGS) / Revenue × 100
What good looks like: Best-in-class public SaaS companies maintain gross margins of 75–85%. Margins below 60% suggest higher infrastructure or services costs, often seen in companies with large professional services components or early-stage cloud migration costs. Gross margin is a prerequisite for long-term profitability — a company cannot FCF-positive without a healthy gross margin.
Related guides & definitions
Frequently Asked Questions
What is a good gross margin for a SaaS company?
A good gross margin for a SaaS company is 70% or above, with best-in-class companies reaching 75–85%. Pure software companies (no significant services revenue) commonly achieve 80%+ gross margins. Companies with professional services or embedded hardware components typically run 60–70%.
Why does gross margin matter for SaaS valuation?
Gross margin is a prerequisite for long-term profitability. High gross margins (75%+) allow SaaS companies to invest aggressively in R&D and sales while still generating positive operating income at scale. Investors use gross margin as a quality signal — companies with low gross margins face structural headwinds reaching profitability regardless of growth rate.
Which SaaS sectors have the highest gross margins?
DevTools, cybersecurity, and pure-play SaaS companies typically achieve the highest gross margins (75–85%). Companies with embedded professional services, marketplace models, or payments processing tend to have lower gross margins (55–70%).
Ara Housepian
Founder & Lead SaaS Analyst, Araho Digital
Ara is the founder of Araho Digital and SaaSDB. He has spent over a decade in software development, SaaS operating metrics modeling, and investment data analysis. Ara holds a degree in Computer Science and focuses on building financial tooling and data pipelines that make institutional-grade SaaS benchmarking accessible to growth operators.
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Data sourced from SEC EDGAR filings · Updated daily · As of 2026-04-25
SaaSDB (2026). Gross Margin Benchmarks — Public SaaS Companies. Retrieved 2026-10-20 from https://saasdb.app/benchmarks/gross-margin/<a href="https://saasdb.app/benchmarks/gross-margin/">Gross Margin Benchmarks — Public SaaS Companies — SaaSDB</a>[Gross Margin Benchmarks — Public SaaS Companies](https://saasdb.app/benchmarks/gross-margin/)SaaS benchmarks digest
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