Marc Benioff, CEO of Salesforce, speaks at Squawk on the Street at the World Economic Forum in Davos on January 20, 2026.
Oscar Molina | CNBC
Cloud software stocks started this year, they stopped in 2025: sales mode.
A continued downward spiral will set the stage for more buying, investors told CNBC.
The WisdomTree Cloud Computing Fundwhich tracks cloud software, is down more than 8% so far this year, while the Nasdaq is up slightly. leading software names such as Salesforce, Serving now and Adobe down more than 14% after underperforming the market a year ago.
The overriding concern is that artificial intelligence will eventually displace key parts of the enterprise stack, as IT buyers look to AI agents to handle tasks large and small that are currently handled by software vendors. Those fears were heightened last week when Anthropic launched an AI agent tool called Claude. Collaborative work it is aimed at the enterprise customer.
A senior investor at a major private equity fund, who spoke on condition of anonymity to speak on the subject, says software disruption is happening today and is forcing several mid-sized software companies to seek financing options, prompting private equity buyouts.
Orlando Bravo, founder of software-focused firm Thoma Bravo, wants to buy into the downturn and sees value in companies building their own agency solutions to work with existing systems.
“We’re seeing tremendous acquisition opportunities right now,” Bravo told CNBC’s Sarah Eisen in Davos on Wednesday. He said his firm is doing deals and will be “much more active.”
While investors like Bravo are bullish on software in an AI-dominated world, KeyBanc analyst Jackson Ader sees real vulnerabilities. In August, he conducted an analysis of the main threats facing software, and then said that the bench was favored by application companies Monday.com, Asana and Sprout Social is exposed to the maximum. All three stocks saw double-digit declines in 2026.
In the same note to clients, Bader said these companies are not tied to systems of record like enterprise resource planning (ERP) or customer relationship management (CRM) and have yet to become multi-product platforms. Representatives for Asana and Sprout did not respond to requests for comment on Monday.
Even companies with a wide range of products and an established enterprise footprint face considerable market uncertainty.
CEO of Salesforce Marc Benioff He spent months trying to defend his company and convince investors that it was well positioned in AI.
At Davos, Benioff told Eisen that the company’s last quarter was “the best quarter we’ve ever had in our careers” and that “we’re one of the biggest cash generators in the world.”
“But it’s not enough,” Benioff said, referring to market action. “Because if you’re not putting out a big tongue twister, you’re not in fashion right now.”
ServiceNow responds to pressure connect potential competition. On Wednesday, the company announced an agreement with OpenAI to use its models to provide AI agents to business customers.
The news did not ease the anxiety. Shares of ServiceNow fell for six consecutive trading days before rebounding on Thursday, and are down 17% in January.
HubSpot, Atlas and Braze had an even worse start to the year, each falling more than 20%.
Rishi Jhaluria, an analyst at RBC Capital Markets, told CNBC that the recent decline in software stocks could force some companies to “explore strategic alternatives” and that any new deals without an AI angle won’t gain much traction among investors.
In a post published in late November, Jaluria mentioned Asana, Box and DocuSign as potential purchase targets in software. The companies did not respond to requests for comment.
As tech earnings season kicks into high gear next week, Wall Street will begin to get a clearer picture of where certain companies stand in embracing or swallowing AI.
One important question, Luria said, is how quickly AI agents like Claude’s Cowork can move from developing new code to actually automating different parts of the software lifecycle. This timeline will be critical to understanding the reality of the AI threat and how quickly cloud software companies may experience the disease.
— CNBC’s Noah Broder contributed to this report.
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