Could AI Disruption Fears Trigger a Software M&A Boom? | WSJ's Take On the Week

Описание: In this week's episode of WSJ’s Take On the Week, co-host Miriam Gottfried and guest host Dan Gallagher, a tech columnist for Heard on the Street, chat with Jefferies software analyst Brent Thill about the recent turbulence in the business software market. They talk about the growing fears that AI will replace the need for traditional software-as-a-service, or SaaS, platforms like Intuit, Salesforce, and Workday. They analyze how the narrative around AI "vibe coding"—where businesses generate their own apps using simple text prompts—has led to a sharp selloff in cloud software stocks. They also note other factors weighing on the sector, including tech layoffs and the shift away from seat-based software pricing models and toward consumption-based metrics.
After the break, Thill explains why he thinks the market's fears over AI disrupting major enterprise software are overblown. They explore why large companies won't trust AI with critical systems for payroll, accounting or taxes. Then Thill makes the case for why AI infrastructure and security companies remain safe bets, and why the current tech selloff and depressed valuations are setting the stage for a massive tech M&A boom driven by private-equity firms.
Chapters:
00:00 Introduction and AI fears in software
00:48 The transition from on-premise to cloud software
02:08 Why AI disruption fears are overblown
03:36 Winners and losers in the AI era
04:59 Security and infrastructure as safe bets
06:09 The Intuit example and vibe coding explained
08:03 Other headwinds facing software companies
10:06 Business model shift from seats to consumption
11:40 The defensibility of trusted systems
13:56 Areas where AI won't replace software
15:40 M&A opportunities in software
18:02 How this differs from past technology shifts
22:35 Why this earnings cycle won't solve the problem
25:56 Where investors are moving their money

This is WSJ’s Take On the Week where co-hosts Telis Demos, Heard on the Street’s banking and money columnist, and Miriam Gottfried, WSJ’s investing and wealth management reporter, cut through the noise and dive into markets, the economy and finance—the big trades, key players and business news ahead.

Have an idea for a future guest or episode? How can we better help you take on the week? We’d love to hear from you. Email the show at [email protected].
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