Profitability · Updated June 2026
Gross Margin Benchmarks
Gross margin by industry and business model. The spread between pure SaaS and services-heavy models is wider than most expect.
Gross margin by industry and business model
| Industry | Business Model | Median GM% | Top Quartile GM% | Bottom Quartile GM% | Rating |
|---|---|---|---|---|---|
| Pure SaaS | Subscription | 76% | 84% | 65% | High |
| Dev Tools / Infrastructure | Subscription | 78% | 87% | 68% | High |
| Dev Tools / Infrastructure | Usage-based | 62% | 74% | 48% | Variable |
| Security / Compliance | Subscription | 74% | 83% | 63% | High |
| MarTech / Sales Tech | Subscription | 72% | 81% | 60% | High |
| MarTech / Sales Tech | Hybrid | 58% | 68% | 44% | Mid |
| Fintech / Payments | Subscription | 68% | 79% | 55% | Mid-High |
| Fintech / Payments | Marketplace / Transaction | 42% | 55% | 28% | Low |
| Healthcare / MedTech | Subscription | 65% | 76% | 52% | Mid-High |
| Healthcare / MedTech | Hybrid (SaaS + services) | 48% | 58% | 34% | Mid |
| Vertical SaaS | Subscription | 68% | 78% | 56% | Mid-High |
| Vertical SaaS | Hybrid | 52% | 63% | 38% | Mid |
| Usage-Based / Consumption | Consumption pricing | 58% | 70% | 42% | Variable |
Sources: KeyBanc Capital Markets SaaS Survey 2023, Bessemer State of the Cloud 2024, public SaaS company SEC filings 2023–2025. Gross margin = (Revenue − COGS) / Revenue per GAAP.
Why gross margin varies this much
Pure SaaS companies with minimal hosting costs and no professional services can achieve 80%+ gross margins. Usage-based models compress margins because infrastructure costs scale with consumption. Marketplace and transaction models collect only a take rate, driving gross margins to 35–55%. Services-heavy deployments (implementation, custom development) consistently drag margins below 60%. When comparing your gross margin, business model matters more than industry.Related benchmarks