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?
Share prices hit new record highs
- The war with Iran has caused volatility on the stock markets in recent months, but the markets have made a strong recovery since the end of March and are reaching new record highs, both in the US and in the euro area.
- We expect to soon be able to return to a scenario of positive (if somewhat delayed) economic growth, with earnings growth fuelled by substantial investment in AI.
- The earnings season was strong in the US, whereas earnings growth was lower in Europe. At sector level, strong earnings growth was posted mainly by technology and financial shares.
What happened in the world?
Oil price falls again to pre-Middle East conflict levels
- The situation in the Middle East appears to have calmed down following the signature of the interim agreement on a 60-day ceasefire. The price of oil has already fallen sharply, but the medium-term impact of the energy crisis remains uncertain.
- Recent inflation figures in both the United States and Europe came in lower than expected. This is positive news for long-term investors because it reduces the pressure on central banks.
- The ECB raised interest rates in June, but the market is expecting an additional rate hike later this year. Analysts also expect the US to have a first rate increase later this year, with a second at the start of next year.
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