iShares Expanded Tech-Software Sector ETF rebounds 40% from April 10 low as software companies report accelerating revenue growth despite AI concerns

The iShares Expanded Tech-Software Sector ETF (IGV) has rebounded by 40% from its 52-week low set on April 10, and now trades only about 11% below its prior peak. The ETF declined by more than a third from its peak as Wall Street worried that AI programming assistants could make legacy software redundant and that AI adoption might reduce per-user software revenue.

The ETF holds 111 stocks with top 10 holdings representing 62% of portfolio value. Leading positions include Oracle (10.4%), Microsoft (7.7%), Palo Alto Networks (7.6%), and Palantir Technologies (7.2%). The ETF has delivered a compound annual return of 9.2% since its inception in 2001, outpacing the S&P 500's 8.5% annualized return over the same period.

Recent earnings reports from software-as-a-service companies including ServiceNow, Atlassian, and Salesforce showed accelerating revenue growth, contradicting the AI-driven disruption narrative. Atlassian introduced a value-based pricing model called Flex that allows enterprises to set a fixed budget and allocate it during their contract period without predicting license needs.