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Top Companies' AI Moves

Burke Wealth Management says enterprise software stocks like CrowdStrike face a valuation crisis because investors fear AI will replace or eliminate the need for traditional software subscriptions.

Top Companies AI — US (2/2)1d ago5 min read
Burke Wealth Management says enterprise software stocks like CrowdStrike face a valuation crisis because investors fear AI will replace or eliminate the need for traditional software subscriptions.

Key takeaway

Enterprise software stocks, including cybersecurity leader CrowdStrike, have collapsed to 10-year valuation lows in early 2026 because investors fear AI will replace traditional software subscriptions or eliminate the need for per-seat licensing. Despite consistent earnings beats and revenue growth forecasts, CrowdStrike and peers like ServiceNow and Snowflake continue to underperform, with stock prices falling each time major AI companies release new tools.

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3 Key Points

  • What happened

    Burke Wealth Management's Focused Growth Strategy fund returned −10.6% in Q1 2026, significantly worse than the S&P 500's −4.3% decline. The firm highlighted CrowdStrike Holdings (trading at $680.92 per share as of June 23, 2026) as a concern, noting that enterprise software stocks peaked at the end of 2024, had a terrible 2025, and an even worse start to 2026.

  • Why it matters

    Investors are pricing enterprise software companies at 10-year lows because the prevailing view is that AI will either replace existing software with AI-generated solutions or destroy the per-seat business model by eliminating human employees. Burke notes that each time Anthropic releases new tools, enterprise software stocks tend to fall 5%. This pessimism persists even though companies like CrowdStrike, ServiceNow, and Snowflake have beaten earnings estimates consistently and are forecasting revenue acceleration in 2026.

  • What to watch

    Burke is consolidating its enterprise software holdings around what it views as best-of-breed platform companies—focusing on raw data (Snowflake), cybersecurity (CrowdStrike), and multi-cloud solutions (ServiceNow, Salesforce). The firm notes its efforts to discriminate between strong and weak businesses have not worked because the broader market is treating all enterprise software stocks similarly, regardless of individual performance.

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FAQ

What are the enterprise software stocks Burke Wealth Management is holding?
Burke holds positions in Snowflake (raw data layer), CrowdStrike (cybersecurity), ServiceNow and Salesforce (multi-cloud platform solutions).
How much did CrowdStrike stock rise over the past year?
CrowdStrike shares gained 37.81% over the past 52 weeks.
What did CrowdStrike and ServiceNow achieve in 2025 despite stock declines?
Both CrowdStrike and ServiceNow grew operating profit over 25% in 2025, and Snowflake more than doubled its operating profit from a somewhat depressed base.

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