AI puts Software-as-a-Service at risk: now what?
Software companies were stock market darlings for years: high growth, high margins and recurring revenues. But today that story is a lot less evident: artificial intelligence is putting pressure on the classic model. What does this mean for investors? Is this a temporary correction, or are we facing a structural upheaval? Mark Van Assche, account manager Private Banking and Wealth, talks about it with Joris Franck, portfolio manager and technology expert at KBC Asset Management.
28-05-2026
How are investors reacting?
Record US share prices. Market interest rates remain high.
- The strong results season, especially for Technology and Banks in the US, produced new records. Earnings growth was lower in Europe.
- The war with Iran has caused volatility on the stock markets in recent weeks, but now appears to be heading towards a resolution. It is still uncertain what impact the energy shock will have on the global economy in the medium term.
- The wars in Ukraine and Iran are driving up the price of fossil energy. This energy crisis is seeping into inflation and inflationary expectations, resulting in a sharp increase in long-term interest rates, as well. On the flip side, bond prices have fallen due to the fact that, when market interest rates rise, investors offer a lower price for current bonds.
What happened in the world?
Risks remain despite hopes for a quick end to the conflict in Iran
- Although a temporary ceasefire has been declared, the war with Iran continues to pose a significant risk to the global economy if energy supplies remain disrupted for a longer period of time. Crude oil prices are linked to the latest news relating to the conflict.
- The energy crisis is clearly reflected in the latest inflation figures. Underlying inflation is also higher than the target rate, but the increase is much less pronounced.
- Anyone thinking they had heard the last of President Trump’s trade tariffs will be disappointed, as he has now announced a new round of tariffs on certain countries.
- In the US, the ‘Big Beautiful Bill’ should provide a limited boost to growth. After raising defence spending, hardly any scope remains in the euro area budget for additional measures to boost the economy.
- In recent months, concerns have surfaced about private loans from lenders other than the traditional banks. While this does weigh on sentiment, larger banks should not be too severely impacted.
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