Companies today allocate significant resources to various aspects of software infrastructure, including servers and data centers for secure data storage and processing, cloud migration and management for scalable environments, network monitoring and management to ensure stability and security, and communication software. Additionally, software delivery and deployment solutions streamline application deployment, while bug tracking and error handling systems manage and resolve software issues. The increasing demand for cloud computing, digital transformation, and the integration of advanced technologies like artificial intelligence and machine learning are expected to drive substantial growth in the global software infrastructure sector. As organizations continue to prioritize agility, scalability, and efficiency, the software infrastructure market is projected to expand rapidly.
According to a January 2025 report by The Business Research Company, the infrastructure software market size is projected to grow from $210 billion in 2024 to $220 billion in 2025, with a growth rate of 5.1%. The market has experienced strong growth in recent years due to spending on legacy system modernization, the increase in remote work, cybersecurity concerns, automation, and application performance optimization. The research firm anticipates continued strong growth, with the market expected to reach around $283 billion by 2029, at a compounded annual growth rate (CAGR) of 6.5%.
Major players in the sector will continue to play a significant role by investing heavily in enhancing their offerings to capture market share. These companies are focusing on developing innovative solutions that leverage AI and automation to improve operational efficiency and enhance the user experience.
Cantor Fitzgerald analyst Thomas Blakey recently initiated coverage of 18 names in infrastructure and artificial intelligence software. In a research note to investors, he highlighted the growing importance of infrastructure software due to the ongoing secular expansion of AI and generative AI. These developments drive the demand for unified, secure, and highly integrated data systems, observable infrastructure, real-time computing and networking capabilities, and enhanced workflows and collaboration. Additionally, the analyst expects cloud infrastructure platforms to be pivotal in consolidating these functions.
Now, let’s explore the 10 best software infrastructure stocks to buy according to analysts.
A software engineer in front of a monitor making coding changes for cloud-native solutions.
Our Methodology
To identify the 10 best software infrastructure stocks, we conducted extensive research to compile a list of fundamentally strong U.S. listed software infrastructure companies with a market capitalization of $2 billion and above. We then ranked the stocks in ascending order of their potential upside, with the stock having highest upside ranked at the top.
Note: all pricing data is as of market close on February 7.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Best Software Infrastructure Stocks to Buy According to Analysts
10. Gen Digital Inc. (NASDAQ:GEN)
Upside Potential: 19%
Number of Hedge Funds: 27
Gen Digital Inc. (NASDAQ:GEN) is a provider of cybersecurity solutions and digital privacy services, dedicated to protecting both personal and organizational data across various platforms. The company’s product suite includes antivirus software, performance management, identity theft protection, and online privacy tools. Gen Digital Inc. (NASDAQ:GEN) owns a portfolio of trusted brands such as Norton, Avast, LifeLock, Avira, AVG, ReputationDefender, and CCleaner.
On January 30, Gen Digital Inc. (NASDAQ:GEN) released its Q3 2025 earnings results (fiscal year ending March 2025), which met street expectations. While the company reported a 4% year-over-year (YoY) increase in revenue to $986 million, adjusted EPS of $0.56 grew 15% YoY driven by cost discipline and improved operating leverage. Management also noted a slight increase in average revenue per user (ARPU), reflecting strong cross-sell and upsell momentum.
In a notable move, Gen Digital Inc. (NASDAQ:GEN) announced the acquisition of MoneyLion for $1.0 billion in cash (in addition to a $23/share CVR issued) in early December 2024. MoneyLion, a fintech company, operates a digital ecosystem for consumer finance. This acquisition aims to diversify Gen Digital Inc. (NASDAQ:GEN) into the full lifecycle of credit and financial wellness offerings for consumers, expanding into a $30 billion Consumer Digital Finance and Financial Marketplace, which is experiencing high-single to double-digit growth. The deal is expected to close in the first half of FY 2026. The company’s strong position to capitalize on the increasing demand for cybersecurity solutions, driven by rising cyber threats and data breaches, coupled with this expansion of its product portfolio, supports its future growth prospects.
9. Microsoft Corp. (NASDAQ:MSFT)
Upside Potential: 22%
Number of Hedge Funds: 279
Microsoft Corp. (NASDAQ:MSFT) is a giant in the tech industry, offering a broad array of software, services, devices, and solutions designed to empower individuals and organizations to achieve productivity and computing prowess. Its cloud computing platform, Azure, is a major player in the cloud services market, providing scalable and flexible solutions for businesses of all sizes. Additionally, Microsoft Corp. (NASDAQ:MSFT) offers products such as Microsoft 365, Windows, LinkedIn, Dynamics business solutions, server products, and gaming.
The company is currently focusing on integrating AI across its products to enhance data processing capabilities and operational efficiency, which should increase demand for its offerings. It has been aggressively expanding its cloud services, with Azure experiencing substantial growth driven by the rising demand for cloud computing and AI solutions. In its Q2 FY 2025 (FY ending June 2025) report on January 29, Microsoft Corp. (NASDAQ:MSFT) reported a total revenue growth of 12% year-over-year (YoY), with cloud revenue growing 21% and achieving a gross margin of 70%. They are also planning to invest about $80 billion in fiscal 2025 on developing data centers in order to train AI models and deploy AI and cloud-based applications. Company CFO Amy Hood remains optimistic about AI-driven cloud services growth, stating:
“Revenue will continue to be driven by Azure, which, as a reminder, can have quarterly variability primarily from in-period revenue recognition depending on the mix of contracts. In Azure, we expect Q3 revenue growth to be between 31% and 32% in constant currency driven by strong demand for our portfolio of services. As we shared in October, the contribution from our AI services will grow from increased AI capacity coming online. In non-AI services, healthy growth continues, although we expect ongoing impact through H2 as we work to address the execution challenges noted earlier.”
