A sign outside ServiceNow headquarters on Thursday, September 4, 2025, in Santa Clara, California.
David Paul Morris | Bloomberg | Getty Images
Software stocks fell sharply on Thursday after disappointing earnings results. ServiceNow and IBM Concerns about whether artificial intelligence tools and services will disrupt businesses have been further heightened.
ServiceNow stock fell about 18% on Thursday, its worst day ever. The company narrowly beat Wall Street expectations on Wednesday, but said the Middle East conflict created a “headwind” to its quarterly subscription revenue. IBM beat on profits and revenue, but maintained guidance. The stock price fell 8%.
sales force and hubspot They fell about 9% and 8%, respectively. adobe Although it fell by 7%, intuition and oracle Both fell about 6%. working day It fell 9% on Thursday and is down more than 45% this year. of iShares Expand Technology Software ETF (IGV)generally tracks the sector, which was down about 6% on Thursday and is down about 19% this year.
The field has been buffeted by concerns that AI tools from companies like Anthropic and OpenAI will replace long-standing cloud subscription models.
The biggest companies in the technology industry primarily release their reports next week. alphabet, Amazon, Meta and microsoft Results are expected to be announced on Wednesday, after which apple A day later.
These companies have endured much better than pure software vendors, largely due to their central position in the AI boom. Microsoft, which has the most exposure to software, was the worst hit this year, down 14%.
Spotlight: ServiceNow, IBM’s first-quarter revenue is weak
