Feb. 23 at 8:58 PM
Software Earnings Take Center Stage Amid AI Disruption
The software sector faces a crucial week as companies report Q4 earnings amid growing concerns over AI disruption. The iShares Expanded Tech-Software ETF has fallen 27% year-to-date, its worst start on record, while the S&P 500 is down 0.2%. Investors are watching to see which firms can financially benefit from AI initiatives and prove resilience against hyper-competition.
Salesforce, Snowflake, Workday, and Intuit are reporting this week, with Salesforce’s AI platform Agentforce posting
$540 million in annual recurring revenue, up 330% year-over-year. Analysts see Salesforce as best positioned among application vendors to leverage AI, while cautioning about competitive risks for others like Workday and Docusign.
Software valuations have dropped sharply: Salesforce trades at 13.2x forward earnings (down from 27.4x), Snowflake at 94.5x (from 176.5x), Workday at 11.7x (from 30x), and Intuit at 14.1x (from 27.1x).
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