Key Takeaways
- Constellation Software (CSU.TO) completed 14 vertical market software acquisitions in Q2 2026.
- Revenue grew 22% to $3.1B; organic growth held at 7% consistent with the company’s targets.
- ROIC remained above 20% for the 18th consecutive quarter.
- The company is increasingly deploying Lumine Group and Topicus structures for non-core verticals.
Constellation Software (CSU.TO) Canada’s most successful technology compounder delivered another quarter of consistent execution in Q2 2026, completing 14 vertical market software acquisitions and maintaining the financial metrics that have made it a core holding in virtually every major Canadian technology portfolio.
The Compounding Machine
Constellation’s business model is elegantly simple in description and extraordinarily difficult to replicate in practice: acquire mission-critical software serving niche vertical markets (fire departments, funeral homes, marina management, dental practices), improve operations and pricing, generate high free cash flow, and redeploy that cash flow into more acquisitions. The company has executed this model with extraordinary consistency since Mark Leonard founded it in 1995.
| Metric | Q2 2026 | Q2 2025 | YoY |
|---|---|---|---|
| Revenue ($B) | $3.14 | $2.57 | +22.2% |
| Organic Growth | 7.1% | 7.4% | -30bps |
| Adj. EBITDA ($M) | $682 | $554 | +23.1% |
| FCF ($M) | $524 | $418 | +25.4% |
| Acquisitions Closed | 14 | 12 | +16.7% |
| ROIC (TTM) | 21.4% | 20.8% | +60bps |