The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Microsoft (NASDAQ: MSFT) and the rest of the automation software stocks fared in Q2.
The whole purpose of software is to automate tasks to increase productivity. Today, innovative new software techniques, often involving AI and machine learning, are finally allowing automation that has graduated from simple one- or two-step workflows to more complex processes integral to enterprises. The result is surging demand for modern automation software.
The 5 automation software stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 5.2% while next quarter’s revenue guidance was 3.8% above.
Luckily, automation software stocks have performed well with share prices up 14.8% on average since the latest earnings results.
Microsoft (NASDAQ: MSFT)
Originally named "Micro-soft" for microcomputer software when founded in 1975, Microsoft (NASDAQ: MSFT) is a global technology company that develops software, cloud services, devices, and AI solutions for consumers, businesses, and organizations worldwide.
Microsoft reported revenues of $90.01 billion, up 17.7% year on year. This print exceeded analysts’ expectations by 2.6%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ EPS estimates.
Interestingly, the stock is up 22.9% since reporting and currently trades at $479.98.
Best Q2: SoundHound AI (NASDAQ: SOUN)
Born from the idea that machines should understand human speech as naturally as people do, SoundHound AI (NASDAQ: SOUN) develops voice recognition and conversational intelligence technology that enables businesses to integrate voice assistants into their products and services.
SoundHound AI reported revenues of $61.9 million, up 45% year on year, outperforming analysts’ expectations by 18.1%. The business had an incredible quarter with a solid beat of analysts’ billings estimates.
SoundHound AI delivered the biggest analyst estimate beat and fastest revenue growth in the group. The market seems happy with the results as the stock is up 9.3% since reporting. It currently trades at $7.03.
Is now the time to buy SoundHound AI? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Pegasystems (NASDAQ: PEGA)
With a "Center-out Business Architecture" approach that transcends organizational silos, Pegasystems (NASDAQ: PEGA) develops software that helps organizations automate workflows and use artificial intelligence to improve customer experiences and business processes.
Pegasystems reported revenues of $420.7 million, up 9.4% year on year, falling short of analysts’ expectations by 1.5%. It was a disappointing quarter as it posted a significant miss of analysts’ billings estimates.
Pegasystems delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Interestingly, the stock is up 2.4% since the results and currently trades at $31.69.
Read our full analysis of Pegasystems’s results here.
Appian (NASDAQ: APPN)
Powering billions of transactions daily since its founding in 1999, Appian (NASDAQ: APPN) provides a low-code platform that helps businesses automate complex processes and operationalize artificial intelligence without extensive programming knowledge.
Appian reported revenues of $203.3 million, up 19.1% year on year. This number beat analysts’ expectations by 5.1%. Overall, it was a very strong quarter as it also recorded a solid beat of analysts’ adjusted operating income estimates and full-year EBITDA guidance exceeding analysts’ expectations.
The stock is up 16.2% since reporting and currently trades at $34.81.
Read our full, actionable report on Appian here, it’s free.
ServiceNow (NYSE: NOW)
Built on a single code base that processes more than 80 billion workflows and 6.5 trillion transactions annually, ServiceNow (NYSE: NOW) provides a cloud-based platform that helps organizations automate and digitize workflows across departments, from IT and HR to customer service and security.
ServiceNow reported revenues of $3.99 billion, up 24% year on year. This print surpassed analysts’ expectations by 1.6%. It was a very strong quarter as it also logged a solid beat of analysts’ adjusted operating income estimates and a decent beat of analysts’ annual recurring revenue estimates.
The stock is up 23% since reporting and currently trades at $117.45.
Read our full, actionable report on ServiceNow here, it’s free.
Market Update
Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership.
Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products.
By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
