AI Killing Software? Analyst Says ‘I Don’t See a Software Apocalypse’
Key takeaways
- AI spending is translating into revenue growth, and Ives doesn't see a software apocalypse.
- 10-15%: Ives' estimate of the industry's completion of the AI revolution
- $495.40: Microsoft's share price during premarket trading on Friday
- 0.30%: Microsoft's share price decline during premarket trading on Friday
What happened
Analyst Dan Ives says AI spending is translating into revenue growth for hyperscalers and AI cloud providers, easing investor concerns about returns on capital expenditure.
Why it matters
Ives sees this shift as an important inflection point because investors increasingly want evidence that massive capital spending can generate sustainable revenue. He points to Microsoft and NVIDIA as companies where continued double-digit capital expenditure growth could support broader technology-sector expansion.
Short-term and longer-term
Short-term. Even when the longer story is the point, the next day or two still matter for AI Killing Software.
Longer-term. Over the next few months, the question for AI Killing Software is whether this changed the longer case, or it is one event.