AI Hype vs. Hardware: The Software Stocks Dilemma
The Economist argues the recent sell‑off in enterprise software shares (SAP, ServiceNow, Salesforce, Workday) is mainly driven by macro headwinds and slower post‑pandemic software investment, not an imminent AI apocalypse. While AI coding tools and AI‑native startups pose risks, incumbents may benefit from scale, stickiness, and the ability to spread AI development costs across many customers; price declines could even boost overall software spending as AI productivity improves. The ultimate outcome depends on whether AI raises or reduces the cost of software and how quickly incumbents monetize those gains versus new entrants.












