Software companies are pouring record money into R&D, and AI has turned that spend into a running meter. Financial statements show what was spent, not what it earned, so investors and boards can't tell winners from cash burners.
That blind spot is where the next decade's software wealth gets made or lost. Whoever sees R&D return first backs the compounders and avoids the burners.
We rank 250 public software companies on one scale, Ratings v3 (0 to 100), measuring 1-year lagged R&D payback, R&D spend, and net profit strictly from SEC filings.
Every note pairs a primary-filing thesis with live Ratings v3 scores and direct 1-click entry into the 3-statement financial model.
Q2 Holdings runs the screens that 28.5M people use to bank with their credit union or community bank. In Q3 it grew revenue 12%, earned a record 59.7% gross margin, paid off its last convertible notes and bought back more stock than it issued as pay.
Salesforce ($CRM) runs the customer record for a large share of the world's sales and service teams, and over the past two years it has rebuilt that franchise around agents.
SailPoint ($SAIL) sells identity security: the software that decides which people, machines and agents can reach which applications and data, and proves it to auditors.
Braze grew revenue 26.16% last quarter and generated $24.21M of operating cash, yet it lost $18.12M on an operating basis because stock pay ran at $36.33M. Owner free cash flow has been negative every year.
Every covered software company is evaluated through one standardized framework: quarterly financial statements and 5-year DCF models, published research pieces, and a single R&D Return rating formula.
Clean, scannable quarterly fundamentals, 6 core operating KPIs, explicit 5-year unlevered cash flow schedules, and WACC sensitivity matrices.
Published software equity research pieces, Stock Profile hubs (/research/[ticker]), catalyst notes, and valuation teardowns with quantified operating value levers across the coverage universe.
One unified Ratings v3 (0 to 100) formula combining 45% R&D Spend + 35% Net Profit + 20% 1-Yr Payback (Leader to Laggard), 3-factor percentile ranks, and the 1-year lagged 2×2 R&D Return Quadrant.
