An S&P index that tracks software stocks is down 17% this year. Salesforce is down 25% and Intuit is down 31%. Why? Two words: agentic AI.
Specifically, the startup Anthropic just released a new tool that’s sparked more fear among investors that software companies are in danger of becoming obsolete.
Organizations with a lot of operational balls in the air use enterprise software from the likes of Salesforce, Workday, ServiceNow and others.
“These are companies that are just at the heart of every business worldwide today,” said Rishi Jaluria, managing director of software research at RBC.
Now comes Anthropic’s new plug-ins for Claude Cowork, which are designed to automate functions in sales, legal and financial analysis, among other things. Those are key domains for enterprise software.
“Many software investors believe the actual value of the software industry is going towards zero,” said Brent Thill, who analyzes tech companies at Jefferies Financial Group.
He thinks the market’s concerns are overblown, though.
“You’re not going to see massive banks that are regulated, insurance companies that have the data and process workflows are unlikely to fully rip out these systems going forward,” Thrill said.
Consequently, existing software companies have time to integrate AI into their offerings.
So why, then, are markets reacting so negatively now to developments in agentic AI?
“I think people are just surprised by the sheer pace of innovation, I would argue, in this ecosystem… which is a way of saying, “I thought this was going to happen in 2027 and I can’t believe that it’s happening in 2025 or 2026,” said Arun Chandrasekaran, an analyst researching AI’s impact at Gartner.
As a result, it’s hard to know when more disruption is coming, and how long software companies have to adapt.
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