Despite growing Wall Street concerns about AI's impact triggering a sell-off in software stocks, prominent figures from the technology and finance sectors have expressed their views on the market turbulence, largely dismissing fears that AI will end the software industry.
NVIDIA CEO Jensen Huang stated that software will not be replaced by AI but will instead become a tool utilized by AI. He commented on the widespread belief that the software industry is in decline and will be superseded by AI, noting that many software companies are under significant stock price pressure as if AI is poised to replace them entirely. Huang described this as highly illogical and expressed confidence that time will prove this viewpoint wrong. He highlighted companies such as ServiceNow, SAP, Cadence, and Synopsys as remaining bright spots in the industry.
OpenAI CEO Sam Altman acknowledged that changes are underway but asserted that software is far from obsolete. He explained that how software is created, used, and the proportion of code automatically generated by systems versus what is needed to maintain a consistent user experience will evolve. Altman predicted that market volatility for software stocks will persist until investors fully comprehend these shifts.
Zoho founder Sridhar Vembu pointed out that even before the emergence of AI, the SaaS industry was ripe for consolidation. He described an industry that spends far more on sales and marketing than on engineering and product development as structurally fragile. Vembu suggested that venture capital and stock market bubbles have long supported an unsustainable business model, with AI merely acting as the catalyst for correction. He added that he encourages employees to acknowledge the possibility of failure, believing that accepting this reality allows for more rational future planning.
Former Microsoft executive Steven Sinofsky argued that while AI may alter the form and development methods of software, claims that "software is dead" are unfounded. He criticized recent market conclusions that pure software companies will be overtaken by language models as nonsense. Sinofsky noted that while some companies will inevitably fail, similar cyclical changes have occurred in retail and media industries. He described the current period as one of the most exciting times in business and technology.
Arm CEO Rene Haas indicated that the deployment of enterprise AI is still in its early stages and far from maturity. From an enterprise application perspective, he believes AI has a long way to go before realizing its full potential. Haas characterized the current market reaction as a short-term emotional overresponse.
J.P. Morgan analyst Stephen Parker advised investors not to overreact to the recent decline in software stocks. He observed a market rotation where recovery logic is broadening beyond AI infrastructure and hyperscale cloud providers. Parker also noted that AI development will continue to impact the software industry.
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