How much do companies spend on SaaS?

Over the past year we’ve seen a sharp spike in SaaS spending – even for companies already deep into digital transformation.

From inflation and shrinkflation to tool sprawl and overprovisioning, software costs are rising across every sector.

But just how much are companies spending on SaaS in 2025?

In this article, we explore the rising cost of SaaS and share a glimpse into how companies are allocating software budgets – all based on data from our latest SaaS Spending Benchmarks Report.

SaaS spending benchmarks: A snapshot

SaaS spend isn’t a one-size-fits-all datapoint.

The exact amount that’s being spent on software varies significantly depending on headcount, growth stage, and industry-specific needs.

Our data shows that:

• Mid-market and enterprise organizations are seeing the biggest absolute increase in spend.
• Technology-driven industries like Retail and IT are rapidly scaling their SaaS stacks to drive efficiency and innovation.
• Software spending within more mature sectors such as Finance and Healthcare is growing at a slower rate, however their overall software investment remains high as a result of complex needs and compliance pressures.  

Access the specific spend data by company size and industry to benchmark your own company’s annual SaaS spend by downloading the full report here.

How are companies allocating their SaaS budgets?

Total spend may be rising as a result of software inflation, technological advancements, and expanding teams, but the focus shouldn’t just be on how much companies are spending, but rather where that spend is going.

Interestingly, our benchmarks reveal shifting priorities across SaaS categories – with investments generally increasing in areas such as HR and AI, while spending on collaboration and marketing tools shows a noticeable pullback.

Again, the exact allocation of SaaS budgets varies significantly across industries and company sizes, reflecting different operational needs and strategic goals.

Curious to see the full breakdown?

Download the report to access the data.

How to make sense of your SaaS spend

Average spend numbers only tell part of the story.

To truly understand whether your organization is overspending or missing opportunities to optimize, it’s important to also look beyond topline figures and consider how budgets are distributed – not only across software categories but also teams.

A metric like SaaS spend per employee provides a more normalized view, helping companies budget more accurately, identify overprovisioned departments or under-resourced functions, and make smarter decisions around vendor consolidation and renewals.

Download our dedicated report to see how SaaS spend per employee benchmarks differ across different company sizes and industries – and see how your own organization compares.