"SaaS has been so lucky in that they've experienced double-digit [revenue] growth for a very long time. Like pretty impressive double-digit growth for a long time. Now that growth isn't just based on how they can be more efficient. It's that they have new competition in the form of OpenAI and Anthropic. So yes. Investors are concerned about how SaaS can continue to grow, and prove its value and price points."
"So now the worry is gone, you can give us back to market cap,"
Software stocks plunged over the past month as investors worry that AI entrants could displace vertical SaaS vendors. Major firms including Adobe, Microsoft, Salesforce, SAP, ServiceNow and Oracle shed more than $730 billion in market value. The iShares Expanded Tech Software Sector ETF is down 19% from a month ago and nearly 30% below its September high. Historically, leading SaaS companies delivered sustained double-digit revenue growth, but investors now question future growth and pricing power amid new AI competition. ServiceNow paused acquisitions after linking part of its market-cap decline to M&A strategy, yet its shares fell further.
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