As concerns over the disruptive impact of artificial intelligence subside, US software stocks reach new highs for 2026.
Joel Jose, Reuters, October 6 - U.S. software stocks are reaching new highs in 2026, thanks to a sharp rise in profit expectations. Several analysts point out this indicates that concerns over industry disruption triggered by artificial intelligence have been largely exaggerated.
The S&P 500 Software & Services Index (.SPLRCIS) rose 1.3% on Tuesday to its highest level since November 2025, following its biggest quarterly gain since Q2 2020 between July and September. Strong earnings reports from software companies such as Salesforce (CRM.N), ServiceNow (NOW.N), and Accenture (ACN.N), along with collaborations with AI labs, have fueled a sustained rebound in the sector since late June.
Cybersecurity stocks performed particularly well. Crowdstrike (CRWD.O), Fortinet (FTNT.O), and Palo Alto Networks (PANW.O) all posted triple-digit gains this year, driven by large-scale enterprise investments in cybersecurity in the age of AI.
"For many software companies, AI acts more as an enabler than a disruptor," said Adam Turnquist, Chief Cross-Asset Strategist at LPL Financial. "We are witnessing a trend reversal, with the software sector regaining its leadership position, and we believe this provides a good opportunity for software to outperform the semiconductor sector."
So far this year, the software index has risen 5%, while the Philadelphia Stock Exchange Semiconductor Index (.SOX), which aggregates many U.S. chipmakers, has surged 87.5% in 2026, though it still lags behind its historical high.
According to data from London Stock Exchange Group (LSEG), the sector’s expected annual profit growth rate for 2026 has climbed from 13.8% at the end of March to 20.6%.
Concerns over a “SAASPOCALYPSE” were exaggerated
From late January to the trough in April, the software index fell more than 26% in what was dubbed the “SaaSpocalypse,” a wave of selling triggered by concerns that enterprises might use AI to develop applications in-house at lower costs.
Analysts now say those fears were premature. “The whole arrival of the ‘SaaSpocalypse’ has been much slower than some on Wall Street anticipated,” said Rebecca Wettemann, CEO of tech research firm Valoir, adding that as AI applications move beyond experimentation, vendors are reporting growing customer adoption.
Even so, the rapidly evolving technology continues to pose risks by disrupting business models. Brian Mulberry, Chief Market Strategist at Zacks Investment Management, said the true test for software stocks may come in the second half of 2027, when increased data center capacity could see AI programming pose a greater threat to traditional software companies.
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路透社•2026-10-06 14:16
