State of SaaS 2025 Report Reveals Operational Complexity and Risk Concerns as Economic Uncertainty and AI Apply Spending Pressure on Technology Investments

IT professionals look to increase automation, eliminate spending waste, combat SaaS sprawl and improve security and governance to support organizational demands 

NEW YORK, April 30, 2025 /PRNewswire/ -- BetterCloud, the premier SaaS Management Platform, today released the results of its annual State of SaaS Report, the industry's largest and longest-running research of its kind. Now in its twelfth year, the report details how nearly 600 IT professionals are navigating the complexities of their Software-as-a-Service (SaaS) environments during a period of increased economic uncertainty and rapid AI acceleration.

Survey respondents cited increased IT workloads, continued reliance on manual processes, and heightened security and governance concerns as key contributors to SaaS management complexity. This complexity is further compounded by broadening adoption of artificial intelligence and associated funding constraints amid ongoing budget pressures. The report also marks the second consecutive year of decline in the average number of cloud applications per company. The average company has now reduced their SaaS applications by 18% from 2022 to 2024 and companies now have fewer SaaS applications than in 2021. 

Already lean IT organizations facing an unprecedented level of SaaS management pressure find themselves at yet another crossroads. "This next era of SaaS management is raising expectations of business value from software as AI-powered cloud applications grow capable of understanding user intent and take intelligent actions to improve business outcomes," stated BetterCloud CEO Jesse Levin. "IT has never been in a better position to deliver strategic value to the business by embracing SaaS lifecycle management across a rapidly changing landscape of application costs, end user demands and data risks." 

Key findings from the State of SaaS 2025 report include:

• Increased IT Workload: The IT-to-FTE ratio has climbed 31% year-over-year to 1 IT person for every 108 full-time employees, the largest single-year increase in demand on IT teams in the history of the survey.
• Persistent Shadow IT Concerns: Nearly 60% of IT professionals continue to express concerns about the risks associated with Shadow IT.
• Automation Gap for Top Challenges: Despite identifying onboarding and offboarding as top challenges for 2025, automation adoption remains low, with only 40% automating offboarding and 34% automating onboarding processes.
• Focus on Cost Optimization: Over half of respondents cite budget pressures and the prevalence of underused applications and licenses as primary drivers for SaaS consolidation and spending cuts.
• Slowing Rate of SaaS Consolidation: While companies now average 106 SaaS applications, down from 112 in 2023, the pace of SaaS consolidation has slowed significantly, dropping from 14% to just 5% year-over-year.
• Preference for Unified Platforms: A majority (51%) find managing SaaS with point solutions more challenging than using an all-in-one SaaS Management Platform (SMP), and 70% prefer a unified platform for optimizing spending, automation, discovery, management, and security.
• Significant AI Investment: An overwhelming 95% of companies have already invested in various AI use cases.
• Burden of Manual Work: 60% of IT teams report excessive manual tasks, hindering their ability to focus on strategic initiatives such as AI adoption.

The State of SaaS 2025 Report offers deeper insights into these trends, including the top SaaS management challenges, automation focus areas, AI use cases and ROI expectations, key SaaS security concerns, trending file-sharing policies, and 2025 IT imperatives.

About BetterCloud

BetterCloud is the leading all-in-one SaaS management platform that helps organizations manage, secure, and govern cloud applications across their enterprise. It makes IT teams more efficient with user and workflow automation while enabling IT and Finance leaders to optimize software spend and reduce security risks. Trusted by thousands of customers and over 2 million users, BetterCloud oversees $35B in annual SaaS transactions and delivers unmatched expertise and support, as validated by customers (G2) and industry analyst reports (Gartner and Forrester) in SaaS Operations Management and SaaS Spend Management. For more information visit www.bettercloud.com

SOURCE BetterCloud