AI Disruption Fear Sparks Investor Scrutiny of Software Stocks

High profit margins, low capital requirements and vast runway for growth prompted the venture capitalist Marc Andreessen in 2011 to famously declare “software is eating the world.” Fourteen years later, artificial intelligence is inspiring similar euphoria and some investors are preparing for a hefty slice of the software industry to become the feast. Salesforce Inc., Adobe Inc. and ServiceNow Inc. are among the worst performers in the S&P 500 this year, down at least 16%, or roughly $160 billion in combined market value.