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Software as a Service (SaaS) Market Size, Share & Industry Analysis, By Deployment Type (Public, Private, and Hybrid), By Application (Customer Relationship Management (CRM), Enterprise Resource Planning (ERP), Content, Collaboration & Communication, BI & Analytics, Human Capital Management, and Others), By Enterprise Type (Large Enterprises and SMEs), By Industry (IT & Telecom, BFSI, Retail & Consumer Goods, Healthcare, Education, Manufacturing, and Others), and Regional Forecast, 2024-2032

Region : Global | Format: PDF | Report ID: FBI102222



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The global Software as a Service (SaaS) market size was valued at USD 273.55 billion in 2023 and is projected to grow from USD 317.55 billion in 2024 to USD 1,228.87 billion by 2032, exhibiting a CAGR of 18.4% during the forecast (2024-2032). North America accounted for a market value of USD 131.18 billion in 2023. This market study has considered various Software as a Service solutions offered by players such as Alphabet’s Google Cloud Marketplace, Google Workspace, Amazon Elastic Compute Cloud by Amazon Inc., Microsoft’s Microsoft Cloud, Cloud Software as a Service Applications, Cloud Consulting Services, IBM Cloud Integration by IBM Corporation, and others.

The Software as a Service (SaaS) market growth can be attributed to several factors, such as rise in adoption of public & hybrid cloud-based solutions, integration with other tools, and centralized data-driven analytics. In addition, key players creating business strategies through partnerships and collaborations for business development will create ample market growth opportunities. For instance,

  • In May 2022, IBM collaborated with Amazon Web Services, Inc. (AWS) to provide a wide range of its software series as SaaS on AWS.

The spread of the COVID-19 pandemic severely impacted the global economy as lockdown measures were put in place to control the spread of the virus. People were confined to their homes to minimize human contact. The rapid spread of the outbreak led IT companies to adopt remote work policies, increasing the need for various SaaS solutions. For instance, the increasing use of Microsoft Office 365 during the COVID-19 pandemic period propelled the growth of the market.

Software as a Service (SaaS) Market Trends

Integration of AI and ML with SaaS Solutions to Propel Market Growth

SaaS solutions have undergone rapid changes as technologies, such as Machine Learning (ML) and Artificial Intelligence (AI), are integrated to improve operation proficiency and intelligence across businesses.

Enterprises in various industries leverage autonomous innovations to enhance their services, products, and optimize content to understand users' needs with data-driven analysis. Machine learning empowers these solutions to improve operation proficiency and intelligence. Hence, by becoming a crucial part of AI-based solutions, enterprises will demand better software training control.

Adoption of AI/ML will likely change this industry in many ways, especially in improving the essential features of several software solutions. Customizing & automating solutions, augmenting security, and enhancing human capacity are all possible by incorporating software as a service solutions and AI/ML abilities. For instance, in September 2022, Nokia stated that it was strengthening its SaaS solution portfolio by offering more compelling solutions to Communication Service Providers (CSPs) and businesses. The new portfolio would help simplify stored & used data, reduce the time for data organization, and carry out repetitive tasks effectively.

Further, Saas is a continuously evolving and transforming service among other cloud computing technologies that provides ample challenges and opportunities for its cloud service providers, consumers, and various industry verticals. The crucial trending factors of SaaS will continue to evolve and outline the future of cloud technologies, their innovation, efficiency, and business values for organizations across the globe. SaaS applications have become an embedded part of enterprise computing globally as more than half of applications are now SaaS-based, according to the Augment company’s SaaS report in 2023. Also, its analyst team suggests approx. 85% of organizations are likely to grasp the ‘cloud-first’ principle by 2025.

Thus, the factors as mentioned above are expected to be a major market trend during the forecast period.

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Software as a Service (SaaS) Market Growth Factors

Adoption of Public and Hybrid Cloud-based Tools by Enterprises to Enhance Market Growth

The rise in adoption of public and hybrid cloud-based solutions in organizations increases system reliability and advances new realities created by the pandemic. Additionally, more enterprises are shifting to hybrid cloud that makes use of on-premises solutions in accordance with public cloud solutions. Several big firms are supporting and encouraging the adoption of cloud-based solutions for future market growth. For instance,

  • November 2022: Microsoft Azure hosted its first Marketplace Summit, which would support Independent Software Vendors (ISV) and SaaS providers in maximizing their marketplace opportunity. This move is expected to help ISVs build end-to-end security through the Microsoft Cloud, including Microsoft Teams, Azure, Power Platform, and Dynamics 365.

Currently, most of the Banking, Financial Services and Insurance (BFSI) sector has already shifted or upgraded to public/private cloud from their existing on-premise self-hosting banking solutions. The industry is required to remain competitive by cost management and compliant with regulatory guidelines and standards. With the use of SaaS, the sector is able to meet payment processing solutions and financial crime mitigation.

Thus, the aforementioned factors act as driving forces for the growth of the market.


Lack of Security for Sensitive Data to Hamper Market Growth

Professionals store their business-sensitive and personal data on software as a service based platforms. Hence, security has always been a significant concern for business professionals. Several enterprises in the industry have identified software as a service misconfiguration as a major challenge.

Furthermore, configuration of internal application setup is becoming a major challenge for security teams. The misconfigurations result in the loss of sensitive data and apprehensive application programming interfaces, leading to unauthorized admission of sensitive data. For instance,

  • April 2022: According to Cloud Security Alliance (CSA), SaaS misconfigurations were responsible for up to 63% of security incidents. At least 43% firms had reported dealing with one or more security incidents due to misconfiguration. The primary cause for misconfigurations is the lack of clarity on changes in the security settings, with several departments having access to SaaS security settings.

Thus, lack of data security is expected to restrict the market growth.

Software as a Service (SaaS) Market Segmentation Analysis

By Deployment Type Analysis

Increasing Adoption of SaaS based Technologies in Hybrid Deployment to Gain Traction in Market

Based on deployment type, the market is categorized into public, private, and hybrid. The hybrid segment is expected to grow at a higher CAGR during the forecast period. The growth is attributed to the rising adoption of hybrid cloud solutions across government departments, public sector organizations, banking & financial institutions, and others. Additionally, cloud policies are evolving around the globe due to increased demand for cloud services. For instance,

  • In 2023, Cloud First policy was replaced by “Cloud Smart3” in many regional and national governments due to increased demand for flexibility, visibility, speed, advanced security, and control across different environments.

According to a survey conducted by Microsoft in January 2022, 86% of the U.S.-based respondents were planning to increase their investment in hybrid cloud and multi cloud.

These factors are expected to provide opportunities for market growth.

By Application Analysis

Streamlining of Data for Content, Collaboration & Communication Segment to Accelerate Market Growth

The market is segmented into various applications, such as Customer Relationship Management (CRM), ERP, content, collaboration & communication, BI & analytics, human capital management, and others (HRM, operations management). The content, collaboration & communication segment is estimated to record a higher CAGR during the forecast period.

Deploying SaaS in content collaboration tools can improve the streamlining of the data flow for content creation, collaborative processes, modification, versioning, and sharing activities of organizations. According to a study by Forbes in 2022, around 73% of companies plan on increasing collaboration, considering it an essential part of a project’s success.

Thus, the aforementioned factors act as opportunities for the growth of the market.

By Enterprise Type Analysis

High Demand for Software as a Service Solution in SMEs due to On-demand SaaS Model to Aid Market Expansion

Based on enterprise type, the market is bifurcated into large enterprises and SMEs.

The SMEs segment is expected to grow significantly during the forecast period. The on-demand software as a service consumption model has transformed the IT landscape and it's been widely adopted by SMEs. SMEs often have small budgets and cannot afford initial capital expenditures or ongoing service and maintenance costs of traditional IT infrastructures. This is why software as a service is an attractive option due to its cost effectiveness, availability, and scalability. Furthermore, investments for product development are also boosting the demand for these solutions. For instance,

  • In April 2023, Taclia, a software as a service startup, announced a solution to digitize everyday management processes. The company secured USD 6.7 million in funding to scale the development of its solution.

These factors are expected to boost the segment’s growth.

By Industry Analysis

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Advancements in Telemedicine Technologies in Healthcare to Grow Market Share

Based on industry, the market is segmented into IT & telecom, BFSI, retail & consumer goods, healthcare, education, manufacturing, and others. The healthcare segment is predicted to record the highest CAGR during the projected period.

Healthcare professionals are migrating their application and storage to the cloud to enable hybrid and remote working. Cloud services help medical professionals gain real-time health data insights and minimize the complexities within an IT system with simplified storage solutions. Rapid advancement in telemedicine technologies, such as video/audio conferencing, telesurgery, and teleradiology, will drive the adoption of cloud services. For instance,

  • May 2021 - HCA Healthcare, an American healthcare company, partnered with Google Cloud. Through this partnership, the companies aimed to build an advanced analytics platform and develop machine learning models for workflow improvements and science-informed decision support.

Thus, the rise in adoption of cloud, digital technology, and smart solutions in healthcare will fuel the segment’s growth.


Regionally, the market is fragmented into North America, South America, Europe, the Middle East & Africa, and Asia Pacific.

North America Software as a Service (SaaS) Market Size, 2023 (USD Billion)

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As per the analysis, North America held a major Software as a Service market share due to the presence of key players in the region, owing to early adoption of technologies such as AI, IoT, robotics, and cloud. The presence of key SaaS platform providers, such as IBM Corporation, Oracle Corporation, and Microsoft Corporation contributes to the region’s adoption of software as a service application.

The market is integrated with Artificial Intelligence (AI) and Machine Learning (ML) and is transforming customer services in North America. The region is expected to grow further due to rising innovations in the market. The U.S. has approximately 17,000 software as a service companies, while Canada has around 2,000 companies. Thus, the U.S. is estimated to hold a major market share during the forecast period.

Europe is expected to gain a prominent market share due to advancements in SaaS solutions by the region’s key players. The region’s private and government corporations are also boosting their investments to increase the adoption of cloud solutions. For instance,

  • February 2022 - Germany-based software company, SAP SE, introduced a cloud platform for data processing domestically.

  • August 2021 - Google Cloud invested USD 1.2 billion in its German cloud computing program. The investment aimed to expand Germany's cloud infrastructure by adding a data center in Berlin.

These factors are expected to foster market growth across the region.

Asia Pacific is projected to show exponential growth owing to the demand for increased resilience and agility across businesses that are likely to adopt cloud solutions. Developed and developing economies, such as China, Japan, and India, have made significant contributions in facilitating the region's adoption of cloud-driven technologies. For instance,

  • June 2022 - Aqua Security Software Ltd., a cloud-based security firm, announced the availability of cloud security software as a service solution, which is being supplied to the majority of the Asia Pacific region. With this introduction, governments, banks, financial services, and other regulated sectors in the region were expected to benefit from an integrated compliance solution. This solution comes with cloud based security management as well as risk management that meets their data rights and governance needs.

The Middle East & Africa is likely to show moderate growth in the coming years due to increased investment from cloud service providers. Government investments during the pandemic in large-scale smart city & public management projects and the availability of a wide range of data center and managed service alternatives will support the adoption of new technologies. These factors are also expected to drive the usage of cloud computing in the Middle East.

List of Key Companies in Software as a Service (SaaS) Market

Market Players Announce Merger & Acquisition Strategies to Expand Reach

Prominent players operating in the global market are focusing on expanding their market share and global presence through merger & acquisition strategies. These companies are acquiring small and local firms to expand their business presence and customer reach.

List of Key Companies Profiled:


  • May 2023: Stibo Systems, a leading global provider of master data management software, joined Microsoft's Partner Program as an independent software exporter to create and host cloud-based Software as a Service on Microsoft Azure. Stibo Systems improved its cloud services with support and guidance from Microsoft. This integration will help customers improve short and long-term performance of their cloud investments and resources.

  • February 2023: Oracle, the world's largest cloud company, launched Banking Cloud Services, a new set of componentized and constructed banking services. Corporate and retail banks can now modernize their banking applications to meet customer demands with the help of Oracle’s cloud-based software as a service solution.

  • November 2022: IBM Corporation launched the New Cloud Modernization Center and IBM Z to accelerate its hybrid cloud portfolio. This will help IBM Z clients modernize their applications, processes, and data in an open hybrid cloud architecture.

  • June 2022: Hewlett Packard Enterprise announced platform developments and new cloud services to its flagship product, HPE GreenLake. It includes a redesigned modern private cloud that provides a cloud-native experience to drive an organization's hybrid strategy. This move is expected to help enterprises enhance their data and applications.

  • May 2022: Google Cloud collaborated with TD Tawandang, a retail technology company, to help micro-retailers across Thailand. Google Cloud delivered a high-tech retail-as-a-service solution to help traditional mom-and-pop stores renovate their business operations and overcome challenges.


An Infographic Representation of Software as a Service (SaaS) Market

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The market research report provides a detailed market analysis. It focuses on key aspects such as leading companies, software types, and leading software & service applications. Besides, the report offers insights into the latest market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market in recent years.




Study Period


Base Year


Estimated Year


Forecast Period


Historical Period


Growth Rate

CAGR of 18.4% from 2024 to 2032


Value (USD Billion)


By Deployment Type

  • Public

  • Private

  • Hybrid

By Application

  • Customer Relationship Management (CRM)

  • Enterprise Resource Planning (ERP)

  • Content, Collaboration & Communication

  • BI & Analytics

  • Human Capital Management

  • Others (HRM, Operation Management)

By Enterprise Type

  • Large Enterprises

  • SMEs

By Industry

  • IT & Telecom

  • BFSI

  • Retail & Consumer Goods

  • Healthcare

  • Education

  • Manufacturing

  • Others (Travel & Hospitality)

By Region

  • North America (Deployment Type, Application, Enterprise Type, Industry, Country)

    • U.S.

    • Canada

    • Mexico

  • South America (Deployment Type, Application, Enterprise Type, Industry, Country)

    • Brazil

    • Argentina

    • Rest of South America

  • Europe (Deployment Type, Application, Enterprise Type, Industry, Country)

    • U.K.

    • Germany

    • Italy

    • France

    • Russia

    • Spain

    • Benelux

    • Nordics

    • Rest of Europe

  • Middle East & Africa (Deployment Type, Application, Enterprise Type, Industry, Country)

    • Turkey

    • GCC

    • Israel

    • North Africa

    • South Africa

    • Rest of Middle East & Africa

  • Asia Pacific (Deployment Type, Application, Enterprise Type, Industry, Country)

    • China

    • Japan

    • India

    • South Korea

    • ASEAN

    • Oceania

    • Rest of Asia Pacific

Frequently Asked Questions

The market is projected to reach USD 1,228.87 billion by 2032.

In 2023, the market value stood at USD 273.55 billion.

The market is projected to record a CAGR of 18.4% during the forecast period of 2024-2032.

The healthcare segment is likely to lead the market.

Adoption of public and hybrid cloud-based tools by enterprises to enhance market growth.

Alphabet Inc., Amazon.com, Inc., Microsoft Corporation, IBM Corporation, Salesforce Inc., SAP SE, Oracle Corporation, Cisco Systems, Inc., Hewlett Packard Enterprise Company, and ServiceNow Inc. are the top players in the global market.

North America is expected to hold the highest market share.

Asia Pacific is expected to exhibit the highest growth rate during the forecast period.

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Below is the list of companies that are studied in order to estimate the market size and/or understanding the market ecosystem 

This list does not necessarily mean that all the below companies are profiled in the report. The report includes profiles of only the top 10 players based on revenue/market share. 

Software-as-a-Service Market

  1. Cisco Systems, Inc.
  2. Nokia
  3. Adverity
  4. Proceedix
  5. Enhancv
  6. TalentLyft
  7. Omilia
  8. Smartlook
  9. Templafy
  10. Dashbird
  11. MeetingPackage
  12. Welcome to the Jungle
  13. FinCompare
  14. Hosthub
  15. Talentuno
  16. 50Skills
  17. SailPoint Technologies
  18. Cloudmore
  19. 10Pearls
  20. Salesforce
  21. Microsoft
  22. Adobe Creative Cloud
  23. FreshBooks
  24. Paychex
  25. Xero
  26. Zendesk
  27. RingCentral
  28. ServiceNow
  29. Workday
  30. Twilio
  • Mar, 2024
  • 2023
  • 2019-2022
  • 134

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