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Rule of 40

A benchmark for software and high-growth companies that combines revenue growth with profitability. A score of 40 or above is considered healthy.

Read more: The Rule of 40: What It Tells You About a Company and What It Doesn't →

Formula

R40 = Revenue Growth (YoY %) + FCF Margin (%)
A company growing revenue at 25% YoY with a 20% FCF margin scores 45 — passing. A company growing at 10% with a 5% margin scores 15 — failing.

How to Interpret

A score ≥ 40 means the company has a strong balance of growth and profitability. A fast-growing company can afford lower margins, while a slower-growing one needs higher margins to compensate. Scores below 40 suggest the company may be burning cash without sufficient growth to justify it.

Why It Matters

The Rule of 40 is the single best quick-check for SaaS and high-growth companies. It forces a trade-off: growth or margins — you need enough of at least one. Companies consistently above 40 tend to create significant shareholder value.

Top 10

1 Micron Technology, Inc. MU Micron Technology, Inc. +393 pts YoY R40+440FY2026Q4 2 Bloom Energy Corporation BE Bloom Energy Corporation +217 pts YoY R40+1822026Q2 3 Palantir Technologies Inc. PLTR Palantir Technologies Inc. +54 pts YoY R40+1552026Q2 4 Vista Energy, S.A.B. de C.V. VIST Vista Energy, S.A.B. de C.V. +171 pts YoY R40+1422026Q2 5 Broadcom Inc. AVGO Broadcom Inc. +66 pts YoY R40+1322026Q3 6 NVIDIA Corporation NVDA NVIDIA Corporation +44 pts YoY R40+128FY2027Q2 7 Bank of America Corporation BAC Bank of America Corporation +136 pts YoY R40+1072026Q2 8 Super Micro Computer, Inc. SMCI Super Micro Computer, Inc. +78 pts YoY R40+100FY2026Q4 9 Robinhood Markets Inc. HOOD Robinhood Markets Inc. +85 pts YoY R40+852026Q2 10 Chevron Corporation CVX Chevron Corporation +84 pts YoY R40+822026Q2

Bottom 10

78 Strategy Inc MSTR Strategy Inc +32 pts YoY R40+22026Q2 79 Oracle Corporation ORCL Oracle Corporation −8 pts YoY R40+2FY2027Q1 80 Exxon Mobil Corporation XOM Exxon Mobil Corporation −10 pts YoY R40+22025Q3 81 Klarna Group plc KLAR Klarna Group plc +1 pts YoY R40+12026Q2 82 QUALCOMM Incorporated QCOM QUALCOMM Incorporated −34 pts YoY R40+1FY2026Q3 83 Xiaomi Corporation XIACY Xiaomi Corporation −47 pts YoY R4002026Q2 84 Alibaba Group Holding Limited BABA Alibaba Group Holding Limited +2 pts YoY R40−22026Q2 85 Coinbase Global, Inc. COIN Coinbase Global, Inc. −27 pts YoY R40−22026Q2 86 Nokia Corporation NOK Nokia Corporation −16 pts YoY R40−72026Q2 87 Baidu, Inc. BIDU Baidu, Inc. −8 pts YoY R40−242026Q2

Rule of 40 by Company

All 97 tracked stocks with reported Rule of 40, ranked highest first on the latest quarter each has reported.

1 Micron Technology, Inc. MU Micron Technology, Inc. +393 pts YoY R40+440FY2026Q4 2 Bloom Energy Corporation BE Bloom Energy Corporation +217 pts YoY R40+1822026Q2 3 Palantir Technologies Inc. PLTR Palantir Technologies Inc. +54 pts YoY R40+1552026Q2 4 Vista Energy, S.A.B. de C.V. VIST Vista Energy, S.A.B. de C.V. +171 pts YoY R40+1422026Q2 5 Broadcom Inc. AVGO Broadcom Inc. +66 pts YoY R40+1322026Q3 6 NVIDIA Corporation NVDA NVIDIA Corporation +44 pts YoY R40+128FY2027Q2 7 Bank of America Corporation BAC Bank of America Corporation +136 pts YoY R40+1072026Q2 8 Super Micro Computer, Inc. SMCI Super Micro Computer, Inc. +78 pts YoY R40+100FY2026Q4 9 Robinhood Markets Inc. HOOD Robinhood Markets Inc. +85 pts YoY R40+852026Q2 10 Chevron Corporation CVX Chevron Corporation +84 pts YoY R40+822026Q2 11 Eli Lilly and Company LLY Eli Lilly and Company +34 pts YoY R40+812026Q2 12 The Charles Schwab Corporation SCHW The Charles Schwab Corporation +2 pts YoY R40+792026Q2 13 Lemonade, Inc. LMND Lemonade, Inc. +40 pts YoY R40+772026Q2 14 The Goldman Sachs Group, Inc. GS The Goldman Sachs Group, Inc. +71 pts YoY R40+712026Q2 15 Palo Alto Networks, Inc. PANW Palo Alto Networks, Inc. +18 pts YoY R40+71FY2026Q4 16 GE Vernova Inc. GEV GE Vernova Inc. +55 pts YoY R40+682026Q2 17 Visa Inc. V Visa Inc. −9 pts YoY R40+67FY2026Q3 18 Advanced Micro Devices, Inc. AMD Advanced Micro Devices, Inc. +10 pts YoY R40+642026Q2 19 Datadog, Inc. DDOG Datadog, Inc. +13 pts YoY R40+632026Q2 20 Occidental Petroleum Corporation OXY Occidental Petroleum Corporation +52 pts YoY R40+612026Q2 21 Unity Software Inc. U Unity Software Inc. +34 pts YoY R40+612026Q2 22 Dell Technologies Inc. DELL Dell Technologies Inc. +35 pts YoY R40+60FY2027Q2 23 Zeta Global Holdings Corp. ZETA Zeta Global Holdings Corp. +10 pts YoY R40+582026Q2 24 Nasdaq, Inc. NDAQ Nasdaq, Inc. −8 pts YoY R40+572026Q2 25 Taiwan Semiconductor Manufacturing Company Limited TSM Taiwan Semiconductor Manufacturing Company Limited −10 pts YoY R40+562026Q2 26 Carvana Co. CVNA Carvana Co. +18 pts YoY R40+552026Q2 27 DoorDash, Inc. DASH DoorDash, Inc. +17 pts YoY R40+552026Q2 28 Marvell Technology, Inc. MRVL Marvell Technology, Inc. −24 pts YoY R40+54FY2027Q2 29 Affirm Holdings, Inc. AFRM Affirm Holdings, Inc. +17 pts YoY R40+53FY2026Q4 30 Intel Corporation INTC Intel Corporation +64 pts YoY R40+532026Q2 31 Mastercard Incorporated MA Mastercard Incorporated −21 pts YoY R40+522026Q2 32 Shopify Inc. SHOP Shopify Inc. +5 pts YoY R40+522026Q2 33 Vertiv Holdings Co VRT Vertiv Holdings Co +6 pts YoY R40+522026Q2 34 CrowdStrike Holdings, Inc. CRWD CrowdStrike Holdings, Inc. +5 pts YoY R40+51FY2027Q2 35 Adobe Inc. ADBE Adobe Inc. +3 pts YoY R40+492026Q3 36 MongoDB, Inc. MDB MongoDB, Inc. +13 pts YoY R40+49FY2027Q2 37 Amcor plc AMCR Amcor plc −14 pts YoY R40+47FY2026Q4 38 Cisco Systems, Inc. CSCO Cisco Systems, Inc. +12 pts YoY R40+47FY2026Q4 39 Apple Inc. AAPL Apple Inc. +10 pts YoY R40+462026Q2 40 Cloudflare, Inc. NET Cloudflare, Inc. +10 pts YoY R40+462026Q2 41 Corning Incorporated GLW Corning Incorporated +16 pts YoY R40+452026Q2 42 The Coca-Cola Company KO The Coca-Cola Company +17 pts YoY R40+452026Q2 43 Docusign, Inc. DOCU Docusign, Inc. +7 pts YoY R40+43FY2027Q2 44 GE Aerospace GE GE Aerospace +4 pts YoY R40+432026Q2 45 JPMorgan Chase & Co. JPM JPMorgan Chase & Co. +30 pts YoY R40+432026Q2 46 Snowflake Inc. SNOW Snowflake Inc. +4 pts YoY R40+41FY2027Q2 47 Microsoft Corporation MSFT Microsoft Corporation −13 pts YoY R40+392026Q2 48 Okta, Inc. OKTA Okta, Inc. +4 pts YoY R40+392026Q3 49 ServiceNow, Inc. NOW ServiceNow, Inc. −3 pts YoY R40+362026Q2 50 Johnson & Johnson JNJ Johnson & Johnson +17 pts YoY R40+352026Q2 51 Uber Technologies, Inc. UBER Uber Technologies, Inc. −6 pts YoY R40+322026Q2 52 Zscaler, Inc. ZS Zscaler, Inc. −13 pts YoY R40+32FY2026Q4 53 Meta Platforms, Inc. META Meta Platforms, Inc. −10 pts YoY R40+312026Q2 54 Hims & Hers Health, Inc. HIMS Hims & Hers Health, Inc. −31 pts YoY R40+302026Q2 55 Siemens AG SIEGY Siemens AG +6 pts YoY R40+30FY2026Q3 56 AbbVie Inc. ABBV AbbVie Inc. −10 pts YoY R40+282026Q2 57 Grab Holdings Limited GRAB Grab Holdings Limited −4 pts YoY R40+262026Q2 58 Netflix, Inc. NFLX Netflix, Inc. −10 pts YoY R40+262026Q2 59 PayPal Holdings, Inc. PYPL PayPal Holdings, Inc. +12 pts YoY R40+252026Q2 60 Block, Inc. XYZ Block, Inc. +20 pts YoY R40+242026Q2 61 Tesla, Inc. TSLA Tesla, Inc. +33 pts YoY R40+222026Q2 62 Salesforce, Inc. CRM Salesforce, Inc. +5 pts YoY R40+212026Q3 63 UiPath, Inc. PATH UiPath, Inc. −5 pts YoY R40+21FY2027Q2 64 The Procter & Gamble Company PG The Procter & Gamble Company 0 pts YoY R40+212026Q2 65 GitLab Inc. GTLB GitLab Inc. −29 pts YoY R40+20FY2027Q2 66 Alphabet Inc. GOOGL Alphabet Inc. 0 pts YoY R40+192026Q2 67 Amazon.com, Inc. AMZN Amazon.com, Inc. +2 pts YoY R40+162026Q2 68 Berkshire Hathaway Inc. Class B BRK-B Berkshire Hathaway Inc. Class B +12 pts YoY R40+162026Q2 69 Generac Holdings Inc. GNRC Generac Holdings Inc. +8 pts YoY R40+162026Q2 70 The Home Depot, Inc. HD The Home Depot, Inc. +2 pts YoY R40+15FY2026Q2 71 Rocket Lab Corporation RKLB Rocket Lab Corporation +17 pts YoY R40+152026Q2 72 Costco Wholesale Corporation COST Costco Wholesale Corporation +4 pts YoY R40+14FY2026Q4 73 Morgan Stanley MS Morgan Stanley −66 pts YoY R40+122026Q2 74 UnitedHealth Group Incorporated UNH UnitedHealth Group Incorporated −9 pts YoY R40+102026Q2 75 Walmart Inc. WMT Walmart Inc. +2 pts YoY R40+10FY2027Q2 76 Upstart Holdings, Inc. UPST Upstart Holdings, Inc. −42 pts YoY R40+42026Q2 77 Vistra Corp. VST Vistra Corp. −5 pts YoY R40+32026Q2 78 Strategy Inc MSTR Strategy Inc +32 pts YoY R40+22026Q2 79 Oracle Corporation ORCL Oracle Corporation −8 pts YoY R40+2FY2027Q1 80 Exxon Mobil Corporation XOM Exxon Mobil Corporation −10 pts YoY R40+22025Q3 81 Klarna Group plc KLAR Klarna Group plc +1 pts YoY R40+12026Q2 82 QUALCOMM Incorporated QCOM QUALCOMM Incorporated −34 pts YoY R40+1FY2026Q3 — AbCellera Biologics Inc. ABCL AbCellera Biologics Inc. R40n/m2026Q2 — AST SpaceMobile, Inc. ASTS AST SpaceMobile, Inc. R40n/m2026Q2 — BitMine Immersion Technologies, Inc. BMNR BitMine Immersion Technologies, Inc. R40n/mFY2026Q3 — Cerebras Systems Inc. CBRS Cerebras Systems Inc. R40n/m2026Q2 — CoreWeave, Inc. CRWV CoreWeave, Inc. R40n/m2026Q2 — Iris Energy Limited IREN Iris Energy Limited R40n/m2026Q2 — Moderna, Inc. MRNA Moderna, Inc. R40n/m2026Q2 — Nebius NBIS Nebius R40n/m2026Q2 — SoFi Technologies, Inc. SOFI SoFi Technologies, Inc. R40n/m2026Q2 83 Xiaomi Corporation XIACY Xiaomi Corporation −47 pts YoY R4002026Q2 84 Alibaba Group Holding Limited BABA Alibaba Group Holding Limited +2 pts YoY R40−22026Q2 85 Coinbase Global, Inc. COIN Coinbase Global, Inc. −27 pts YoY R40−22026Q2 86 Nokia Corporation NOK Nokia Corporation −16 pts YoY R40−72026Q2 87 Baidu, Inc. BIDU Baidu, Inc. −8 pts YoY R40−242026Q2 88 Sandisk Corporation SNDK Sandisk Corporation R40+451 †FY2026Q4

n/m — not meaningful: extreme revenue growth or cash flow relative to revenue distorts the score. These rows are unranked and use zero only as their ordering position.

† — no year-ago R40 to compare against: too little reported history to trend the score, so these rows rank below the companies with a full year-over-year comparison.

FY — quarters on the company's own off-calendar fiscal year; unprefixed quarters follow the calendar year.

Related Indicators

FCFFree Cash Flow FCF%FCF Margin RevGRevenue Growth (YoY)