Today's frame
Gross margins of 76% separate the viable SaaS business from the merely survivable—a threshold that determines whether software scales into compound revenue growth or collapses under its own cost structure.
The metric gains urgency as AI orchestration platforms claim value not from model quality but from workflow integration, a shift that rewards margin discipline over raw compute spend. Tomasz Tunguz has emerged as the sharpest voice on this transition, dissecting how public SaaS benchmarks increasingly favor companies that abstract complexity rather than build it. The question now is whether orchestration margins compress as competition intensifies or expand as enterprises consolidate vendors.
