Analysis of Software Companies' Stock Volatility
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 30 2026
0mins
Source: NASDAQ.COM
- Market Reaction: Earlier this year, stocks of Salesforce and HubSpot plummeted by 40% and 54% respectively as investors panicked over the potential obsolescence of software products due to agentic AI, reflecting significant market fears regarding the SaaS business model.
- Growth Potential: While HubSpot's revenue growth rate reached 23% in Q1, surpassing Salesforce's 14%, its P/E ratio of 95.1 indicates a high valuation that may expose it to greater downside risk if growth slows.
- Profitability Comparison: Salesforce achieved a net profit margin of 19% in its fiscal Q1 2027, compared to HubSpot's mere 3.7%, highlighting Salesforce's clear advantage in profitability, although HubSpot may improve its margins in the future.
- Annual Recurring Revenue: Salesforce's Agentforce segment reported an annual recurring revenue of $1.2 billion, a 205% year-over-year increase, indicating rapid market share growth in agentic AI, although it may take time for this to significantly impact overall revenue.
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Analyst Views on HUBS
Wall Street analysts forecast HUBS stock price to rise
27 Analyst Rating
24 Buy
3 Hold
0 Sell
Strong Buy
Current: 193.840
Low
450.00
Averages
582.08
High
800.00
Current: 193.840
Low
450.00
Averages
582.08
High
800.00
About HUBS
HubSpot, Inc. provides a customer platform that helps businesses connect and grow better. The Company delivers seamless connections for customer-facing teams with a unified platform that includes artificial intelligence (AI)-powered engagement hubs, a Smart CRM, and a connected ecosystem with applications marketplace integrations, a community network, and educational content. Its AI-powered engagement hubs include Marketing, Sales, Service, Operations, Content, and Commerce, as well as other tools and integrations that enable companies to attract, engage, and delight customers throughout the customer lifecycle. Its customer platform features a central database of lead and customer interactions, and integrated applications designed to help businesses attract visitors to their websites, convert visitors into leads, close leads into customers, transact with those customers, and delight them so they become promoters of those businesses. Breeze is its AI that powers the customer platform.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Analysis of Software Companies' Stock Volatility
- Market Reaction: Earlier this year, stocks of Salesforce and HubSpot plummeted by 40% and 54% respectively as investors panicked over the potential obsolescence of software products due to agentic AI, reflecting significant market fears regarding the SaaS business model.
- Growth Potential: While HubSpot's revenue growth rate reached 23% in Q1, surpassing Salesforce's 14%, its P/E ratio of 95.1 indicates a high valuation that may expose it to greater downside risk if growth slows.
- Profitability Comparison: Salesforce achieved a net profit margin of 19% in its fiscal Q1 2027, compared to HubSpot's mere 3.7%, highlighting Salesforce's clear advantage in profitability, although HubSpot may improve its margins in the future.
- Annual Recurring Revenue: Salesforce's Agentforce segment reported an annual recurring revenue of $1.2 billion, a 205% year-over-year increase, indicating rapid market share growth in agentic AI, although it may take time for this to significantly impact overall revenue.
See More
SaaS Sector Showdown: Comparing HubSpot and Salesforce Amidst Market Shifts
- Market Performance Comparison: Both HubSpot and Salesforce have been impacted by the SaaSpocalypse event, with HubSpot's stock down 54% and Salesforce down 40% year-to-date, indicating a gradual recovery of market confidence in software stocks despite AI technology presenting growth opportunities for both.
- Revenue Growth Disparity: HubSpot achieved a 23% revenue growth in Q1 2023, surpassing Salesforce's 14%, yet HubSpot's net profit margin stands at only 3.7%, significantly lower than Salesforce's 19%, highlighting the need for HubSpot to balance growth with profitability.
- Agentforce vs. Breeze AI: Salesforce's Agentforce has reached an annual recurring revenue of $1.2 billion, a 205% year-over-year increase, while HubSpot's Breeze AI revenue is not disclosed separately, but its overall revenue growth acceleration suggests increasing competitiveness in the AI sector.
- Valuation Differences: Salesforce's P/E ratio of 17.7 offers a greater margin of safety compared to HubSpot's high 95.1 P/E ratio, indicating that HubSpot's elevated valuation may pose greater risks if its revenue growth decelerates, prompting investors to consider their risk tolerance in their investment decisions.
See More
HubSpot Maintains Growth Amid SaaSpocalypse, AI Enhances Business Model
- Significant Revenue Growth: HubSpot reported $881 million in revenue for Q1 2026, with $862.3 million from subscriptions, reflecting a robust 23% year-over-year growth that underscores the company's strong market performance and customer loyalty.
- Expanding Customer Base: HubSpot finished the quarter with nearly 300,000 subscribers, marking a 16% increase year-over-year, indicating the company's success in customer acquisition and retention, which enhances its competitive position in the market.
- AI Innovations Driving Growth: The AI features launched by HubSpot, such as Customer Agent and Prospecting Agent, are delivering positive outcomes for customers, and are expected to further enhance the value of its products and customer satisfaction, driving future revenue growth.
- Optimistic Future Outlook: Management anticipates an 18% revenue increase in 2026, which, while a deceleration from current growth rates, suggests that HubSpot could exceed this guidance based on its current market valuation and the potential driven by AI advancements.
See More
HubSpot Leverages AI to Expand Market Share Amid Stock Decline
- Customer Base Growth: HubSpot's total customer count approached 300,000 in Q1, reflecting a 16% year-over-year increase, indicating that despite market challenges, the company continues to attract new clients and maintain a stable revenue stream.
- Strong Revenue Performance: HubSpot reported total revenue of $881 million in Q1, with $862.3 million from subscriptions, both up 23% year-over-year, demonstrating the resilience of its business model and ongoing market demand.
- AI Innovations Driving Growth: The AI innovations launched by HubSpot, such as Customer Agent and Data Agent, aim to enhance customer experience and strengthen product competitiveness, which is expected to further drive revenue growth in the future.
- Optimistic Future Outlook: Management anticipates an 18% revenue increase in 2026, indicating potential despite a deceleration in growth, showcasing the company's adaptability in the AI space and the possibility of exceeding market expectations.
See More
Thoma Bravo Founder Declares End of SaaSpocalypse
- AI Boost for Software Firms: Orlando Bravo, founder of Thoma Bravo, stated that AI is viewed as an 'enormous tailwind' for software companies, predicting a merger of software and AI tools into new 'agentic solutions' that will enhance corporate customer service efficiency.
- Investor Confidence Recovery: Despite a sell-off in software stocks in February triggered by Anthropic's advanced AI tools, Bravo believes investors are underestimating software companies' adaptability, particularly as his portfolio companies thrive with a combined revenue of $35 billion driven by AI.
- Market Adjustment Phase: Bravo highlighted that the market is currently in an adjustment phase where investors and companies must address governance, cybersecurity, and ROI concerns regarding new AI tools, indicating a cautious approach amid rapid industry changes.
- Software Stock Rebound: As market sentiment improves, the iShares Expanded Tech-Software Sector ETF surged 21% in May, marking its best monthly performance since October 2001, reflecting signs of recovery in software stocks and optimism about AI's future prospects.
See More
HUBS Options Contract Analysis and Investment Opportunities
- Put Option Appeal: The current bid for the $210.00 put option is $28.00, and if an investor sells this contract, their effective purchase price for HUBS shares would be $182.00, representing a 1% discount to the current price of $211.90, making it attractive for potential buyers.
- Yield Potential Analysis: Should the put option expire worthless, it would yield a 13.33% cash return, equating to an annualized return of 65.77%, highlighting the high yield potential of this strategy, appealing to income-seeking investors.
- Call Option Returns: The $220.00 call option has a current bid of $24.10, and if an investor buys HUBS at $211.90 and sells this call, they could achieve a total return of 15.20% if exercised, showcasing the attractiveness of this strategy.
- Risk and Return Assessment: The $220.00 call option has a 47% chance of expiring worthless, allowing investors to retain both their shares and the premium collected, with an annualized yield boost of 56.10%, providing an additional income opportunity for investors.
See More
Analysis of Software Companies' Stock Volatility
- Market Reaction: Earlier this year, stocks of Salesforce and HubSpot plummeted by 40% and 54% respectively as investors panicked over the potential obsolescence of software products due to agentic AI, reflecting significant market fears regarding the SaaS business model.
- Growth Potential: While HubSpot's revenue growth rate reached 23% in Q1, surpassing Salesforce's 14%, its P/E ratio of 95.1 indicates a high valuation that may expose it to greater downside risk if growth slows.
- Profitability Comparison: Salesforce achieved a net profit margin of 19% in its fiscal Q1 2027, compared to HubSpot's mere 3.7%, highlighting Salesforce's clear advantage in profitability, although HubSpot may improve its margins in the future.
- Annual Recurring Revenue: Salesforce's Agentforce segment reported an annual recurring revenue of $1.2 billion, a 205% year-over-year increase, indicating rapid market share growth in agentic AI, although it may take time for this to significantly impact overall revenue.
See More
SaaS Sector Showdown: Comparing HubSpot and Salesforce Amidst Market Shifts
- Market Performance Comparison: Both HubSpot and Salesforce have been impacted by the SaaSpocalypse event, with HubSpot's stock down 54% and Salesforce down 40% year-to-date, indicating a gradual recovery of market confidence in software stocks despite AI technology presenting growth opportunities for both.
- Revenue Growth Disparity: HubSpot achieved a 23% revenue growth in Q1 2023, surpassing Salesforce's 14%, yet HubSpot's net profit margin stands at only 3.7%, significantly lower than Salesforce's 19%, highlighting the need for HubSpot to balance growth with profitability.
- Agentforce vs. Breeze AI: Salesforce's Agentforce has reached an annual recurring revenue of $1.2 billion, a 205% year-over-year increase, while HubSpot's Breeze AI revenue is not disclosed separately, but its overall revenue growth acceleration suggests increasing competitiveness in the AI sector.
- Valuation Differences: Salesforce's P/E ratio of 17.7 offers a greater margin of safety compared to HubSpot's high 95.1 P/E ratio, indicating that HubSpot's elevated valuation may pose greater risks if its revenue growth decelerates, prompting investors to consider their risk tolerance in their investment decisions.
See More
HubSpot Maintains Growth Amid SaaSpocalypse, AI Enhances Business Model
- Significant Revenue Growth: HubSpot reported $881 million in revenue for Q1 2026, with $862.3 million from subscriptions, reflecting a robust 23% year-over-year growth that underscores the company's strong market performance and customer loyalty.
- Expanding Customer Base: HubSpot finished the quarter with nearly 300,000 subscribers, marking a 16% increase year-over-year, indicating the company's success in customer acquisition and retention, which enhances its competitive position in the market.
- AI Innovations Driving Growth: The AI features launched by HubSpot, such as Customer Agent and Prospecting Agent, are delivering positive outcomes for customers, and are expected to further enhance the value of its products and customer satisfaction, driving future revenue growth.
- Optimistic Future Outlook: Management anticipates an 18% revenue increase in 2026, which, while a deceleration from current growth rates, suggests that HubSpot could exceed this guidance based on its current market valuation and the potential driven by AI advancements.
See More
HubSpot Leverages AI to Expand Market Share Amid Stock Decline
- Customer Base Growth: HubSpot's total customer count approached 300,000 in Q1, reflecting a 16% year-over-year increase, indicating that despite market challenges, the company continues to attract new clients and maintain a stable revenue stream.
- Strong Revenue Performance: HubSpot reported total revenue of $881 million in Q1, with $862.3 million from subscriptions, both up 23% year-over-year, demonstrating the resilience of its business model and ongoing market demand.
- AI Innovations Driving Growth: The AI innovations launched by HubSpot, such as Customer Agent and Data Agent, aim to enhance customer experience and strengthen product competitiveness, which is expected to further drive revenue growth in the future.
- Optimistic Future Outlook: Management anticipates an 18% revenue increase in 2026, indicating potential despite a deceleration in growth, showcasing the company's adaptability in the AI space and the possibility of exceeding market expectations.
See More
Thoma Bravo Founder Declares End of SaaSpocalypse
- AI Boost for Software Firms: Orlando Bravo, founder of Thoma Bravo, stated that AI is viewed as an 'enormous tailwind' for software companies, predicting a merger of software and AI tools into new 'agentic solutions' that will enhance corporate customer service efficiency.
- Investor Confidence Recovery: Despite a sell-off in software stocks in February triggered by Anthropic's advanced AI tools, Bravo believes investors are underestimating software companies' adaptability, particularly as his portfolio companies thrive with a combined revenue of $35 billion driven by AI.
- Market Adjustment Phase: Bravo highlighted that the market is currently in an adjustment phase where investors and companies must address governance, cybersecurity, and ROI concerns regarding new AI tools, indicating a cautious approach amid rapid industry changes.
- Software Stock Rebound: As market sentiment improves, the iShares Expanded Tech-Software Sector ETF surged 21% in May, marking its best monthly performance since October 2001, reflecting signs of recovery in software stocks and optimism about AI's future prospects.
See More
HUBS Options Contract Analysis and Investment Opportunities
- Put Option Appeal: The current bid for the $210.00 put option is $28.00, and if an investor sells this contract, their effective purchase price for HUBS shares would be $182.00, representing a 1% discount to the current price of $211.90, making it attractive for potential buyers.
- Yield Potential Analysis: Should the put option expire worthless, it would yield a 13.33% cash return, equating to an annualized return of 65.77%, highlighting the high yield potential of this strategy, appealing to income-seeking investors.
- Call Option Returns: The $220.00 call option has a current bid of $24.10, and if an investor buys HUBS at $211.90 and sells this call, they could achieve a total return of 15.20% if exercised, showcasing the attractiveness of this strategy.
- Risk and Return Assessment: The $220.00 call option has a 47% chance of expiring worthless, allowing investors to retain both their shares and the premium collected, with an annualized yield boost of 56.10%, providing an additional income opportunity for investors.
See More
