Why software stocks are getting pummelled
economist.com
February 2, 2026
1 min read
Summary
SAP projected a slight deceleration in its cloud-based software business for 2026, leading to a 15% drop in its share price. ServiceNow's share price fell by 13% despite reporting revenue growth in the latest quarter.
Key Takeaways
- SAP's share price dropped by 15% after announcing a projected "slight deceleration" in its cloud-based software business for 2026.
- ServiceNow's stock fell by 13% despite reporting faster-than-expected revenue growth in the latest quarter.
- Salesforce and Workday experienced stock declines of 7% and 8%, respectively, without any recent news impacting their performance.
Community Sentiment
MixedPositives
- AI tools are enabling smaller teams to create unique, one-of-a-kind systems, which could revolutionize software development and reduce reliance on traditional SaaS companies.
Concerns
- The perception that AI-generated code can replace the need for software engineers overlooks the ongoing complexities and costs associated with software development and maintenance.
- There is a growing AI weariness among users, suggesting that reliance on AI tools may not be as favorable as initially thought, impacting major players in the market.
Source
economist.com
Published
February 2, 2026
Reading Time
1 minutes
Relevance Score
57/100
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