Goldman Sachs CEO David Solomon has called the recent AI software sell-off “too broad,” suggesting the market overreacted to capex anxiety and that the sweeping destruction Wall Street has been pricing in is unlikely to materialise. The call is a high-conviction buy-the-dip signal from one of the Street’s loudest voices.
What Solomon Said
- The AI software sell-off was “too broad”
- AI won’t create the sweeping destruction Wall Street has been dreading
- Goldman sees software earnings power as more durable than implied prices suggest
- Selective opportunities across application software, infrastructure, and platform names
What Goldman Likely Means
- Most software companies will monetise AI, not be replaced by it
- Capex from hyperscalers feeds enterprise software P&Ls (renewals, expansions, premium tiers)
- Replacement-by-AI fears in legacy SaaS were priced too aggressively
- Multiples have re-rated below sustainable trend
Market Implications
- Software-stock dispersion likely to widen — winners pull away, losers stay punished
- Goldman’s coverage list will be re-read for which names they specifically favour
- Index-level pressure may continue while quality names re-rate
- Hyperscaler spend patterns increasingly read as a positive for SaaS, not just for chips
Why It Matters
Goldman’s call lands at a moment when AI capex is the dominant tape narrative. Solomon’s view tilts the reading from “AI eats software” toward “AI lifts software.” If others follow, the next leg is selective software-stock recovery rather than broad-tech reflation.
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