EV / Revenue Multiple: Definition, Formula & SaaS Benchmarks
What is EV / Revenue Multiple?
The EV/Revenue multiple (Enterprise Value divided by Revenue) measures how much investors pay for each dollar of annual revenue. It is the primary valuation benchmark for high-growth SaaS companies that are not yet profitable, and reflects the market's expectations for future growth and margin expansion.
Formula
EV/Revenue = Enterprise Value ÷ Annual Revenue (TTM)Worked Example
If a company has an enterprise value of $10B and trailing twelve-month revenue of $1B, its EV/Revenue multiple is 10x. A peer with $5B enterprise value and $1B revenue trades at 5x — a 50% discount, likely reflecting slower growth or lower margins.
What Good Looks Like
Thresholds derived from live data across 172 public SaaS companies tracked on SaaSDB.
Live Rankings
View full rankings →| Rank | Company | EV / Revenue Multiple |
|---|---|---|
| #1 | Skillz Inc.(SKLZ) | 0.0x |
| #2 | Coursera, Inc.(COUR) | 0.3x |
| #3 | DXC Technology Co(DXC) | 0.3x |
| #4 | Rapid7, Inc.(RPD) | 0.3x |
| #5 | TaskUs, Inc.(TASK) | 0.5x |
| · · · | ||
| #168 | Palantir Technologies Inc.(PLTR) | 76.0x |
| #169 | Cloudflare, Inc.(NET) | 38.9x |
| #170 | Applied Digital Corp.(APLD) | 36.5x |
| #171 | CrowdStrike Holdings, Inc.(CRWD) | 30.5x |
| #172 | Datadog, Inc.(DDOG) | 24.9x |
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Frequently Asked Questions
What is a good EV/Revenue multiple for SaaS?
Multiples vary widely by growth rate. High-growth companies (>40% YoY) often trade at 10–20x or higher. Slower-growing companies (10–20% YoY) typically trade at 4–8x. Context always matters.
How does EV/Revenue differ from P/S ratio?
EV/Revenue uses enterprise value (market cap + net debt), while P/S uses market cap alone. EV/Revenue is preferred for SaaS because it accounts for capital structure — a company with significant cash on its balance sheet will have a lower EV/Revenue than its P/S.
Does a high EV/Revenue multiple mean a stock is overvalued?
Not necessarily. A high multiple reflects the market's expectation of future growth and profitability. Companies with durable growth, high gross margins, and strong NRR can sustain premium multiples for years.
Related reading
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.
format_quoteCite This Data
Data sourced from SEC EDGAR filings · Updated daily · As of 2026-05-22
SaaSDB (2026). EV / Revenue Multiple: Definition, Formula & SaaS Benchmarks. Retrieved 2026-06-07 from https://saasdb.app/glossary/ev-revenue-multiple/<a href="https://saasdb.app/glossary/ev-revenue-multiple/">EV / Revenue Multiple: Definition, Formula & SaaS Benchmarks — SaaSDB</a>[EV / Revenue Multiple: Definition, Formula & SaaS Benchmarks](https://saasdb.app/glossary/ev-revenue-multiple/)