The SaaSpocalypse that wasn’t – how Salesforce, Booking and IBM are thriving with AI

The apocryphal quip attributed to Mark Twain, “the rumors of my death are greatly exaggerated,” rings true for certain companies in the software space amidst widespread but premature fears of AI-driven obsolescence.

Over the last year, approximately $2 trillion in software value has been torched on fears that AI will render many software businesses obsolete in the years ahead, in what has become known as the “SaaSpocalpyse,” prematurely announcing the death of the software as a service (SaaS) sector.

The original SaaSpocalpyse thesis of “death,” or at least massive disruption, was how bears were thinking in the early part of the year, but that bearish thesis has now morphed into a less drastic, but still incorrect, theme of how software companies will have to pay more for customer acquisition moving forward with far less pricing power, compressing margins and hindering profitability.

Just as the classic 1979 Francis Ford Coppola film Apocalypse Now was based on a fictional delirium, so, perhaps is the SaasSpocalyse now.

Yes: there is no question that many high-flying technology winners will be under increasing competitive threat from autonomous AI agents moving forward, and the list of companies that look vulnerable is a long one.

At the same time, the panicked investor stampede to the exits across software firms has wrongly punished several of the clearest beneficiaries from AI as if they were obvious casualties.

Three examples – Salesforce , Booking Holdings, and IBM – illustrate how, contrary to short-term market fears, there are certain software companies well positioned to become big AI winners in the long term, with greater profitability and pricing power from AI-driven wins, not less.

Salesforce The misleading bearish AI scenario has an appealing simplicity for some anxious analysts.

Salesforce, the leading customer relationship management (CRM) system, was wrongly predicted to be facing obsolescence by LLM companies like OpenAI and Anthropic, whose autonomous AI agents would presumably manage customer relationships from beginning to end.

This led misinformed critics to demote Salesforce from its robust position as the central command center of a business to that of merely a passive database sitting in the background that agents occasionally query.

The erroneous presumption was that the AI models would capture all the value, and Salesforce would be relegated to being an interchangeable commodity if not entirely redundant.

Down roughly 20% this year and 40% from its high, the stock has been priced for precisely that faulty diagnosis.

These confused critics read the dynamic backwards.

Salesforce isn’t what’s being commoditized; it’s the LLMs, and in this new world, data is the new moat – and Salesforce has the data.