Q1 2024 Software Industry Trends

Software transaction volume increased 19 percent on a quarterly basis, from 424 to 504. Aggregate value increased 2.3 times, from $31.5 billion to $73.3 billion.

Deal volume in the Niche Software segment, which is targeted to specific vertical markets, increased 25 percent over Q4 2023. The segment’s largest transaction in Q1 2024 was Synopsys’ announced acquisition of ANSYS, the global leader in engineering simulation, for $32.6 billion. Two other notable transactions in the engineering space were Renesas Electronics Corporation’s announced acquisition of Altium, a global leader in electronics design systems, for $5.7 billion, and Cadence Design Systems’ announced acquisition of Beta Simulation Solutions, a leader in Computer-Aided Engineering, for $1.2 billion.

M&A activity in the Business Software segment, which consists of software designed for general business practices and not specific industry markets, increased 20 percent from Q4 2023 to Q1 2024. The segment’s largest deal year-to-date was Thoma Bravo’s announced acquisition of Everbridge, a global leader in critical event management (CEM) and national public warning solutions, for $1.5 billion. Another notable transaction in the Business segment was H.I.G. Capital’s announced acquisition of Alight Solutions, a leading cloud-based human capital technology and services provider, for $1.1 billion.

Activity in the Consumer Software segment rose 43 percent from Q4 2023 to Q1 2024. The most notable transactions in the Consumer segment were Embracer Group’s $460 and $247 million divestitures of Gearbox Software and Saber Interactive, two videogame developers, to Take-Two Interactive and Beacon Interactive respectively. Take-Two Interactive is one of the largest interactive entertainment companies in the world, while Beacon Interactive is a newly created, privately-held company founded by Matthew Karch, cofounder of Saber.