I think ASX tech shares are among the best investments we can make over the long term. That's because of their impressive profit margins and ability to grow quickly.
It's easy for a business that sells software to sell just one more subscription – there aren't the physical impediments like with selling a car, a couch or a phone.
I've written about both of the below ASX tech share ideas several times within the last 12 months. I wish I'd bought them last year (or even earlier). I'd call them some of the best tech investments Aussies can buy on the ASX.
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TechnologyOne Ltd (ASX: TNE)
This global business provides enterprise software for more than 1,300 businesses, governments, councils, education institutions, and others. It has offices in six countries.
I think this company's base earnings are very defensive because software is essential for these organisations to run their operations. TechnologyOne regularly wins new clients and significantly invests in new features for subscribers to provide better software (and unlock stronger revenue).
The market clearly recognises the quality and potential of this ASX tech share, with the TechnologyOne share price up by an incredible 113% in the past year.
I'm not expecting it to double again in the next 12 months, but I believe it has a strong outlook with what it expects in the coming years.
In the FY25 first-half result, the business announced a 31% increase in net profit after tax (NPAT) to $63 million and a 21% rise in total annual recurring revenue (ARR) to $511.1 million. It aims to reach at least $1 billion of ARR by FY30.
The business also expects the economies of scale from its global software solution to enable the profit before tax margin to expand to at least 35% in the long term.
That combination of rising revenue and improving margins bodes well for the ASX tech share's bottom line and could help support further gains for the TechnologyOne share price in the coming years.
Global X Fang+ ETF (ASX: FANG)
This is an ASX-listed exchange-traded fund (ETF) that allows Aussies to invest in 10 of the largest and best technology businesses in the US.
It regularly rebalances the portfolio to ensure its weightings with its holdings are (close to) equal.
The 10 businesses are: Broadcom, Netflix, Nvidia, Meta Platforms, Apple, Microsoft, Crowdstrike, ServiceNow, Amazon.com, and Alphabet.
These companies are among the world's leaders in AI, cloud computing, digital advertising, online video, social media, cybersecurity, self-driving cars, computer software, gaming, and so on. The businesses have several growth avenues. I'm calling this an ASX tech share because we can buy it on the ASX.
In the year to 30 June 2025, the Global X Fang+ ETF delivered a net return of 34.9% and in the prior five years, it has returned an average of 30.5%.
Past performance is not a guarantee of future returns, but I believe these businesses' being among the world's leading companies gives them more potential to outperform the broader share market in the coming years.
