Software Selloff vs. Walmart $1T: Start of the “Software Death Loop”?

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02-05
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Software Stocks Crash as Walmart Hits $1 Trillion! Is this the biggest market shift of 2025?

The market is showing a brutal split right now:

Software stocks are getting crushed. While $Wal-Mart(WMT)$ just crossed a $1 trillion market cap, up ~14% YTD — outperforming Apple, Microsoft, and Amazon

1) What happened: software names got hit hard

One of the biggest triggers behind this selloff is the market repricing how fast AI could disrupt parts of the software stack.

After new developments around Anthropic’s Claude (and the broader narrative that AI tools can increasingly replace knowledge-work workflows), investors started questioning:

How much of “software value” is truly defensible anymore? Damage report (single day): ~$285B market cap wiped out

Some notable moves:

The market fear is simple:

If AI can do parts of what software does, then what’s the moat?

2) Jensen Huang’s response: AI won’t replace software

NVIDIA CEO Jensen Huang pushed back on the most extreme version of the narrative, calling the “AI replaces software” idea illogical.

His point is practical: AI is more like an efficiency layer, not a full replacement. You don’t rebuild Excel from scratch just because AI exists. But the key is:
Only the strongest software categories will survive as “must-haves.”

3) Why Walmart is winning: physical assets + AI = real operational leverage

So why is Walmart suddenly the winner in this narrative?

Not because it’s an “AI company” — but because it owns what AI can’t replace:
physical assets, supply chain scale, and logistics networks.

Some market highlights being discussed:

  • ~60% of warehouses automated with AI

  • ~90% of restocking AI-driven

  • Partnerships with Google & OpenAI

  • Conversion rates reportedly up ~22%

4) “Software death loop”: JPMorgan views BDCs are becoming the credit risk hotspot.

This selloff becomes more dangerous when it shifts from equity panic to a broader credit stress narrative.

JPMorgan’s take is that the selloff in software — and other industries perceived to be exposed to AI disruption — has shown little sign of easing.

More importantly, JPMorgan warns the risk is increasingly migrating from stocks into credit markets, with Business Development Companies (BDCs) turning into a key pressure point.

According to JPMorgan, BDCs hold roughly: $70B in software-related loans, around 16% of their total portfolios

After the sharp software drawdown, these loan-linked assets may become mispriced or “dislocated.”

5) If the paradigm is shifting… how to position?

Discussion: what’s your take? 👇

So what’s really happening here?

Is this just a short-term panic… or a real regime shift?

Do you think this is:

A) the beginning of the end for software stocks, or
B) an overreaction that creates a buying opportunity?

Leave your comments to win tiger coins!

80% Rate Cut By June: Will S&P 500 Extend Gains?
US January CPI surprised to the downside, with headline inflation rising just 0.2% MoM (vs. 0.3% expected) and 2.4% YoY, the lowest since last May. Core inflation also came in softer than forecast, pushing market pricing for a Fed rate cut before June to 80%. Treasury yields slipped as traders pulled forward easing bets, while equities initially cheered the cooling inflation print. Does softer CPI reflect higher possibility of rate cuts? Will the S&P 500 extend gains on rate-cut optimism?
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Comments

  • Shyon
    02-05
    Shyon
    在我看来，这并不是“软件已死”——而是市场积极地重新定价哪些软件实际上拥有护城河。故事迅速转变，拥挤的定位让抛售看起来很残酷。这感觉更像是恐惧驱动的评级下调，而不是基本面突然崩溃。

    $Wal-Mart(WMT)$ 达到1万亿美元是有意义的，因为人工智能正在以物理规模和运营复杂性放大业务。人工智能将沃尔玛的物流和供应链转化为真正的利润杠杆，而许多软件公司现在必须证明它们是必不可少的，而不是可选的。

    所以我倾向于B：这是一种过度反应，不是软件的终结。但是 $摩根大通 Chase(JPM)$ 摩根大通信用警告很重要——如果压力蔓延到BDC，波动性还没有结束。机会是有选择性的：只有具有关键任务角色和定价能力的软件才值得反弹。

    @Tiger_comments @TigerStars @TigerClub

  • koolgal
    02-05
    koolgal
    🌟🌟🌟Walmart $Wal-Mart(WMT)$ recent ascent to USD 1 trillion market capitalisation, proves that in an age of digitalisation, physical scale  is the ultimate superpower.

    No Agentic AI can replicate the sheer physical grit of 5,000 stores or the complex machinery of global fulfilment.

    By using its massive footprint into high velocity AI hubs & a high margin advertising juggernaut, Walmart has successfully shed its old retail skin to become a tech powered titan.

    Walmart isn't just selling groceries anymore.  It is selling an automated hyper efficient future where logistics is the new software.

    While the SaaS sector may tremble, Walmart's trillion dollar milestone is an achievement that the late great Sam Walton, Founder would be proud of.  From a single variety store in 1962 to today's crowning success, this achievement remains rooted in his original Every Day Low Price philosophy.

    @Tiger_comments @Tiger_SG @CaptainTiger @TigerClub @TigerStars

  • 1PC
    02-10
    1PC
    🐯Software Selloff vs Walmart $1T Software stocks saw ~$285B wiped out in a day as AI disruption fears hit valuations. APP, U, PLTR all dropped, while WMT surged past $1T on AI‑driven logistics & physical moats. Jensen Huang insists AI is an efficiency layer, not a replacement.🎯 My view: B — Overreaction. This is short‑term panic. I’m buying the dip in mission‑critical software[Wow]@JC888 @Barcode @Shyon @koolgal @Shernice軒嬣 2000 @Aqa @DiAngel
  • BTS
    02-09
    BTS
    The recent market action marks a historic apex, where the real economy begins harvesting AI gains once reserved for tech creators

    With Walmart (WMT) becoming the first traditional retailer to hit a $1 trillion market cap while software stocks crash, the market stands at a crossroad, signaling a pivot where operational AI integration is now valued as highly as software innovation。。。

    Investors now bet that real-world AI users offer more upside than software sellers, fearing that AI-automated coding will erode traditional SaaS pricing power and competitive moats

    While this volatility may be a short-term panic, a regime shift is emerging where high interest rates and persistent inflation favor profitable titans over high-growth software

    Despite the "Software Death Loop" fears, this sell-off creates a buying opportunity for foundational AI leaders like Microsoft Corp (MSFT) and Palantir Technologies Inc (PLTR), whose platforms provide the essential AI data infrastructure

  • TimothyX
    02-06
    TimothyX
    當這種拋售從股市恐慌轉向更廣泛的恐慌時，它會變得更加危險信用壓力敘事.

    摩根大通的觀點是，軟件和其他被認爲容易受到人工智能顛覆的行業的拋售——幾乎沒有緩和的跡象.

    更重要的是，摩根大通警告稱，風險正越來越多地從股票轉移到信貸市場，與業務發展公司(BDC)變成一個關鍵的壓力點。

    據摩根大通稱，BDC大致持有：$70B軟件相關貸款，圍繞佔其總投資組合的16%

    在軟件大幅縮水後，這些與貸款相關的資產可能會被錯誤定價或“錯位”。

  • TimothyX
    02-06
    TimothyX
    这次抛售背后的最大触发因素之一是市场重新定价人工智能颠覆部分软件堆栈的速度。

    在围绕Anthropic的Claude的新进展（以及人工智能工具可以越来越多地取代知识工作流程的更广泛叙述）之后，投资者开始质疑：

    有多少“软件价值”是真正可以辩护的？损失报告（单日）：约$2850亿市值被抹去

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