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Are You Ready for the 2025 Software Audit Frenzy?

Software audit: the words no IT procurement professional wants to hear but can’t afford to ignore. If you’re in the enterprise IT world, you’ve probably noticed a spike in audit activity lately. And so have we, which is why we’re offering a new Enterprise Software Audit Defense Workshop as part of our online training curriculum. In the trenches, our analysts are reporting record numbers of audit activity among our clients.

So, why the sudden increase in software audits for enterprise customers in 2025, and how can you avoid becoming the next cautionary tale?

Why Are Software Audits Increasing in 2025?

It all comes down to two things: revenue and product adoption. Let’s start with the former.

Software vendors are under intense pressure to increase revenue year over year, and audits have become a tried-and-true method to achieve that. Why? Because when it comes to enterprise-scale software deployments – think Microsoft or Oracle – nearly every customer is out of compliance with their software licensing agreements in one way or another. The vast majority of these instances are unintentional, but that has no bearing on the outcome. Fees for noncompliance can easily be 7 or 8 figures.

A company’s risk for software audits is directly tied to the financial performance of their software vendors. Let’s take Oracle, for example. Last quarter, the company’s revenue fell short of analyst expectations. While Java audits have been a concern for a while, companies are seeing a dramatic increase in audit notifications for database and middleware. Funny how that works.

Software audits are also a direct line to increasing product/solution adoption using pressure tactics. If you don’t want to upgrade at your next renewal, your software vendor may threaten an audit. Or let’s say you undergo a formal audit. Rather than pay $15M in penalty fees, the vendor may offer to waive the penalty if you upgrade or migrate to a solution that is better aligned with their product roadmap. Both of these scenarios are very common and underscore the importance of addressing compliance as part of your software renewal preparations.

Which Vendors Are Auditing the Most?

By the numbers, the biggest offenders continue to be the usual suspects as the list below indicates. But it’s important to point out what the list doesn’t show us. Emerging software vendors are following in the footsteps of giants like Microsoft and Oracle, adopting aggressive auditing practices to boost their bottom lines. The result? No software vendor is too small to send an audit notice your way.

Here are the biggest offenders over the last few years:

• Oracle: Known for its rigorous audit processes, Oracle continues to be a primary threat. Their focus on enterprise solutions like databases and ERP systems ensures they target the most lucrative accounts, while Java deployments are particularly vulnerable given recent licensing/pricing changes.

• Microsoft: Microsoft audits aren’t new, but they’ve ramped up in the cloud era. With many enterprises shifting to Microsoft 365 and Azure, the risk of misinterpreting licensing terms is high – and so are the stakes.

• Adobe: Adobe’s Creative Cloud and Document Cloud have made their software indispensable. But beware: even a single unlicensed installation can trigger an audit.

• VMware (Broadcom): Broadcom loves a good audit, and they can be ruthless. Since its acquisition of VMware, audit activities have surged. Non-compliance in these environments can result in hefty penalties.

• SAP: SAP’s audit strategy is notoriously complex, especially for enterprises using their ERP systems. Their focus on indirect usage often catches companies by surprise.

How Can You Prepare?

Here are two resources to help your IT procurement team prepare for the uptick of software audits in 2025:

• Register for our Enterprise Software Audit Defense Workshop. This live session will cover vendor-specific guidance, audit red flags, and best practices that align with vendor’s software audit playbooks. This is a must-attend for anyone serious about getting ahead of the audit threat in 2025.

• Read our step-by-step guide on The Importance of Software License Audit Preparation. We cover things you can do right now to reduce your risk exposure on your largest software estates.

The Bottom Line

The software audit surge of 2025 isn’t going away anytime soon. For enterprise IT procurement teams, preparation isn’t just a best practice – it’s a survival skill. By staying informed, proactive, and vigilant, you can turn audits from a crisis threat into an opportunity to strengthen your compliance framework. Remember, the best audit is the one that never happens!

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