5 High-Margin Software Giants Dominating Through Recurring Revenue

Businesses built on recurring revenue models often enjoy greater visibility, stability and predictability in their cash flows. When more than 80% of revenue comes from recurring sources, it can signal strong customer retention, high switching costs and a business model designed for long-term resilience.

For investors, these companies stand out because their earnings are less dependent on one-time sales and more tied to steady, repeatable streams of income. That consistency can support both growth and shareholder returns over time.

Here are 5 companies with strong recurring revenue models that highlight the appeal of this durable business structure.

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Salesforce (CRM)

Salesforce is a global leader in customer relationship management software with a broad suite of cloud-based enterprise solutions.

The company generated revenues of approximately $37.9 billion in fiscal 2025, reflecting strong year-over-year growth.

Salesforce has recently initiated a quarterly cash dividend, with a current forward dividend yield of approximately 0.69%, while still reinvesting in product innovation and acquisitions. Its recurring subscription revenues and focus on artificial intelligence integration through tools like Einstein provide stability and growth opportunities.

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Adobe (ADBE)

Adobe is one of the most established names in creative and digital media software, offering widely used products such as Photoshop, Illustrator, and Acrobat.

The company reported revenues of approximately $21.51 billion in fiscal 2024, with a trailing twelve-month net income margin of about 30%, highlighting the strength of its high-margin subscription model. While Adobe has not paid a dividend since 2005, it generates consistent free cash flow that it uses to reinvest in research and development and to pursue acquisitions in digital marketing and analytics.

Its shift to Creative Cloud has secured a large base of recurring revenues, and its continued integration of AI tools enhances customer engagement and retention.

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ServiceNow (NOW)

ServiceNow provides enterprise workflow automation through its Now Platform, with growing adoption across IT, HR, and customer operations.

In its most recent fiscal year, the company delivered revenues of approximately $10.98 billion, representing year-over-year growth of about 22.4%. Its subscription model underpins a gross margin of over 79.2%, reflecting strong scalability.

ServiceNow does not offer a dividend, instead focusing on reinvestment to expand its platform and global reach. The company’s high renewal rates and rising adoption of digital transformation solutions position it well for continued growth.

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Wall Street Analysts Are Bullish on These 5 Undervalued Compounders With Market-Beating Potential

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• Strong revenue growth and durable competitive advantages
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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!