Key Highlights

  • Pagaya Technologies reported its first meaningful GAAP profit, the clearest sign in the group of AI-driven lending turning into hard earnings.
  • nCino grew first-quarter fiscal 2027 Revenue 11% to $159.4 million while branding itself the platform for agentic AI banking.
  • Blackbaud remains the steadiest, least AI-forward name, supplying durable fundraising and administrative software to nonprofits.
  • Commvault posted its most subscription-heavy transformation yet, positioning cyber-resilience as an enterprise AI insurance policy.

Investors spent much of 2026 asking a blunt question: which software companies are actually turning artificial intelligence into revenue, Margin and durable demand, and which are simply talking about it? Blackbaud (NASDAQ:BLKB), Pagaya Technologies (NASDAQ:PGY), nCino (NASDAQ:NCNO), Priority Technology Holdings (NASDAQ:PRTH) and Commvault Systems (NASDAQ:CVLT) will not settle that debate, but together they sketch a useful map. Each trades on Nasdaq. Each sits in a distinct corner of software and technology services: social-good software, AI consumer credit, banking software, payments and data protection. And each reported this year against a backdrop of stretched large-cap AI valuations and an uncertain rate path. Their recent results, summarized below, show AI narratives at very different stages of financial maturity.

The Sector Backdrop: Rate Anxiety Meets AI Scrutiny

Mid-September 2026 finds software investors caught between two forces. The first is monetary policy. The Federal Open Market Committee is scheduled to meet on September 16, and markets have widely anticipated further easing after the Fed signaled a cautious cutting bias through 2026 (based on recent Fed guidance). Lower rates historically flatter long-duration software equities and rate-sensitive lending models, though nothing is guaranteed until the decision lands.

The second force is scrutiny of AI itself. After a multi-year run led by megacap AI infrastructure names, commentators across financial media spent September debating where AI valuations still make sense. That skepticism raises the bar for smaller software and Fintech companies: it is no longer enough to mention "agents" or "machine learning." The market increasingly wants recurring revenue, expanding margins and Cash Flow attached to the story.

The five companies here answer that Demand unevenly, which is precisely what makes the group instructive.

Blackbaud (NASDAQ:BLKB): Steady Social-Good Software and "Agents for Good"

Blackbaud is the veteran of the group, supplying fundraising, financial and administrative software to nonprofits, schools and foundations. Its appeal has always been durability rather than growth heroics, and the second-quarter 2026 results reported on July 29 fit that mold. Total revenue reached $290.6 million, up 3.0% year over year, with Recurring Revenue of $285.3 million representing 98.2% of the total. GAAP Earnings per share came in at $0.79 and non-GAAP EPS at $1.33, while Operating Cash Flow rose to $91.1 million. Management reaffirmed full-year 2026 guidance of $1.173–$1.179 billion in revenue and $5.15–$5.25 in non-GAAP diluted EPS, and noted roughly $850 million remaining under its buyback authorization.

On AI, Blackbaud leaned into its "Agents for Good" framing and an AI Coalition for Social Impact certification effort. The near-98% recurring mix and aggressive repurchase pace (management targets 6-10% of shares in 2026) make Blackbaud a capital-return story with an AI overlay, not an AI growth story. The swing Factor to watch is whether AI features lift net revenue retention rather than merely defending it.

Pagaya Technologies (NASDAQ:PGY): AI Lending Finally Showing Profits

Pagaya Technologies is the group's purest AI-and-fintech play, running a machine-learning Credit network that helps lenders and institutional investors underwrite consumer loans. For years the question was whether the model could produce GAAP profit. The second-quarter 2026 report on July 30 offered its strongest answer yet. Total revenue and other income was $387 million, up 19% year over year, on record network Volume of $3.5 billion, up 33%. GAAP Net Income reached $45 million, a $29 million improvement, while adjusted EBITDA rose 43% to $124 million and diluted EPS was $0.49. Crucially, Pagaya raised full-year 2026 net income guidance to $155–$180 million, alongside higher network-volume and adjusted-EBITDA ranges. A company delivering sustained GAAP net income on an AI-underwriting model is exactly the proof point skeptics have demanded, and the raised guidance signals confidence. RISK: Pagaya's fortunes remain tied to consumer credit performance and funding-market appetite; a deterioration in Loan losses or securitization demand would pressure the model quickly. If credit holds and rates ease, the profitability trajectory looks self-reinforcing, but that "if" is doing real work.

nCino (NASDAQ:NCNO): Repositioning as the "Platform for Agentic AI Banking"

nCino sells cloud banking software to financial institutions, and it has arguably bet its narrative most explicitly on AI. In its first-quarter fiscal 2027 release on May 27, 2026, the company branded itself "the platform for agentic AI banking." Total revenue was $159.4 million, up 11% year over year, with subscription revenue of $140.9 million, up 12%. GAAP diluted EPS was $0.12, and non-GAAP Operating Margin expanded to 28%, up roughly 1,100 basis points from a year earlier. For full-year fiscal 2027, nCino guided to $642.0–$646.0 million in total revenue and $166.0–$171.0 million in non-GAAP operating income, with annual contract value guidance of $662.5–$667.5 million. The standout here is margin. Growth is steady rather than spectacular, but the double-digit jump in profitability shows a maturing software company converting scale into Operating Leverage while investing in AI. RISK: Bank IT budgets are cyclical and consolidation-prone, and "agentic" branding invites scrutiny if adoption metrics lag. Watch whether AI features translate into faster ACV growth in coming quarters, not just tighter margins.

Priority Technology Holdings (NASDAQ:PRTH): Payments Compounding Quietly

Priority Technology Holdings rounds out the fintech side as a payments and "Connected Commerce" provider spanning merchant services, payables and embedded banking. It is the least AI-forward name in the group, and its second-quarter 2026 results on August 6 reflect a steadier compounding story. Revenue was $262.3 million, up 9.4% year over year, with organic growth of 7.2%. Net income was $9.9 million, adjusted EBITDA rose 6.0% to $59.4 million, and adjusted diluted EPS increased 11.5% to $0.29. The company affirmed full-year 2026 guidance of $1.01–$1.04 billion in revenue and $230–$245 million in adjusted EBITDA. CEO Tom Priore attributed the quarter to Priority's "Connected Commerce engine." Payments volume growth plus rising adjusted EPS is a classic operating-leverage profile, and the affirmed guidance suggests visibility into the second half. RISK: Consumer and small-business spending softness, plus intense payments competition, could compress take rates. Priority's more prosaic positioning could become an advantage if the market rotates away from expensive AI narratives toward proven cash-generating fintech, a rotation worth monitoring into year-end.

Commvault (NASDAQ:CVLT): Cyber-Resilience as the Enterprise AI Insurance Policy

Commvault Systems anchors the data-protection and cyber-resilience corner, and it posted the group's most subscription-heavy transformation. In its first-quarter fiscal 2027 release on July 28, 2026, the company framed itself as a leader in "unified resilience at enterprise scale." Total revenue was $314.1 million, up 11% year over year, while subscription revenue rose 16% to $267.0 million and SaaS revenue jumped 39% to $100.6 million. Subscription annualized recurring revenue reached $1,054.3 million, up 22%. GAAP diluted EPS was $0.50 and non-GAAP EPS was $1.42. Commvault guided full-year fiscal 2027 subscription ARR to $1,200–$1,210 million and a non-GAAP EBIT margin near 21%, and highlighted an AI-and-resilience Partnership with Microsoft. The SaaS acceleration and ARR crossing the billion-dollar mark show a legacy backup vendor successfully re-platforming into recurring cyber-resilience, a category that benefits as AI expands both the attack surface and the value of clean, trusted recoveries. RISK: Shares fell sharply after the print despite the beat, a reminder that expectations were elevated. Durable ARR growth matters more than any single quarter's reaction.

What Investors Should Watch

The near-term macro catalyst is common to all five: the September 16 Fed decision and the tone of its guidance. Lower rates would ease valuation pressure on software multiples and support Pagaya's credit-funding Economics in particular, though the outcome is not assured.

Company-specific signals differ. For Pagaya, watch consumer credit performance and whether raised guidance holds. For nCino and Commvault, watch whether AI positioning shows up as accelerating ACV and ARR rather than slideware. For Blackbaud, watch retention and the pace of buybacks. For Priority, watch payments volume and take rates as a read on small-business health. Across the group, the theme is the same: the market now wants AI claims underwritten by recurring revenue and margin.

Software Companies Sorted by AI Payoff

Assembled this way, these five Nasdaq names will not resolve the AI-valuation argument, but they usefully illustrate its spectrum. Pagaya shows AI producing hard GAAP profit; nCino and Commvault show established software vendors converting AI-era demand into subscription momentum and margin; Priority shows steady fintech compounding with minimal AI dependence; and Blackbaud shows a mature Franchise returning Capital while layering AI onto sticky, mission-driven software. In a September defined by rate anxiety and AI skepticism, the companies attaching real cash flow to their narratives look best positioned, and the ones still selling the promise face the highest bar.