AI fears hurt software stocks, but three firms are thriving.
Salesforce leads in customer data, Booking in travel transactions, IBM in consulting.
Their AI-driven wins show the SaaSpocalypse was overstated.
What happened
Despite fears of an AI-driven 'SaaSpocalypse,' Salesforce, Booking Holdings, and IBM are positioned as AI winners. Salesforce's Agentforce grew from $100 million to $1.5 billion in annual recurring revenue in 18 months, and IBM says AI now accounts for half of its new consulting signings.
Why it matters
The panic that erased about $2 trillion in software value was misplaced. These companies' strengths—Salesforce's customer data, Booking's role as merchant of record, IBM's consulting margins—turn AI into an advantage, not a threat. Wells Fargo analysts noted, 'lower cost of intelligence increases value of incumbent data.'
What to watch
Booking said AI-sourced traffic is still below 1% of room nights, suggesting early upside. IBM's stock fell 25% in a day but a third of lost deals closed shortly after, hinting at recovery.
Ask the AI about this article →
The article argues that the market's fear of AI replacing software companies was overblown, as evidenced by the three examples. Salesforce's data moat, Booking's transactional role, and IBM's consulting shift to outcome-based billing all show how AI can enhance, not destroy, their businesses.
The SaaSpocalypse narrative evolved from 'death' to margin compression, but the article contends this too is wrong. For instance, Salesforce's data becomes more valuable as AI lowers intelligence costs, and Booking's infrastructure is irreplaceable for smaller hotels.
Looking ahead, these companies' AI investments may yield further gains. IBM's Red Hat grew 11% as AI creates new software needs, while Booking's AI traffic is still minimal, suggesting room for growth. The key takeaway: AI is a tool for incumbents with data and infrastructure, not just a disruptor.
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