ServiceNow's unexpected expense surge makes its rich valuation more vulnerable in a struggling software sector. Revenue rose 21%, but spending drove an EPS miss and one quarter of guided cRPO deceleration; wider market conditions could hurt near term. The 20% selloff looks excessive, and few software companies should benefit as much from AI. Management could deliver over 3-5 years, though the stock is only close to a buy again now; below $100 looks good for the long term. x.com  x.com  x.com  x.com 

Software stocks keep getting sold off even as software revenues keep climbing. x.com 

The software selloff looks overdone, as AI seems to be creating dispersion rather than killing software. All 13 S&P 500 software companies that have reported so far beat EPS estimates, and software stocks are up about 40% from their April lows. x.com 

Software stocks have no real bull case; their recent strength is purely positioning-driven, so after perhaps a couple more weeks of gains they should resume falling. x.com 

Software's relative strength and sound finances make institutional rotation from semis plausible. It could lead while semis consolidate, despite slow growth at some firms; the market rewards cash flow, healthy balance sheets and manageable debt. Salesforce, ServiceNow, Palantir, Shopify and Workday hold up; SAP's cloud and AI shift, Instacart's massive 10-month base, Veeva's massive five-year base and Atlassian's Stage 2 strength add to the case. Semis may still rally; the view can change. x.com  … Show more

SaaS will have its time in the sun again, and now, while it is still hated, is the time to pick favorites and build positions. Bearish sector narratives don't last forever, and the view that all SaaS is being disrupted should ease somewhat this summer, though multiples may not return to prior levels. Some SaaS names have little moat against Anthropic and peers, but many, especially cybersecurity and Palantir, are strengthened by the agentic push. x.com  x.com  x.com 

The rally in US software stocks is really long in the tooth, if anyone is still left who believes AI alternatives run by one- or two-person shops can cannibalize a lot of software. x.com 

Software stocks such as Adobe sold off on a threat that was never real: the AI labs' internal plans to compete with them were delusional and never a real possibility. x.com 

Software stocks should keep grinding higher as the market reduces the AI fear factor. Much of the software rally since the April lows was just erasing past losses, and many names remain well below their all-time highs. Since those lows, software has risen almost as much as semiconductors with about 10x less noise. x.com 

Uncertain AI-capex profits and higher oil costs from Iran still threaten US stocks. The SPCX-Nvidia deal brought much-needed overnight inflows to chips and is shifting sentiment, but tech's waterfall decline will not heal with a sharp V-bottom. Be prepared for a big fade. x.com