"Technology industry leaders" firmly support the five major software stocks, saying that the impact of AI is being "overly exaggerated as doomsday scenario" by the market.

Against the background of rapid development of artificial intelligence, the software sector of the US stock market has recently experienced a significant sell-off. However, the Wall Street investment bank Wedbush does not agree with the market's pessimistic pricing. In its latest report, Wedbush pointed out that the market is "overly pricing in doomsday scenarios" for the software industry, and the related concerns are clearly exaggerated. It specifically named Microsoft, Palantir Technologies, CrowdStrike, Snowflake, and Salesforce, Inc. as the top five software stocks worth holding in the current "software winter". Led by Wedbush analyst Dan Ives, the team known as the "technology bulls" in the market, stated that although AI may pose certain pressures on traditional software business models in the short term, the market's response to this risk is clearly exaggerated. The current sell-off of software stocks is based on an extreme assumption that the industry will be completely disrupted by AI, which is not feasible in reality. Ives pointed out that enterprise customers are far more cautious about migrating to AI than the market imagines. Many companies are not willing to expose their core data to immature new platforms in pursuit of AI benefits, nor are they willing to easily abandon the software infrastructure built over the past decades at a cost of billions of dollars. "AI is facing headwinds in the short term, no doubt about that, but the current pricing in the market, as if the software industry is about to face 'doomsday', is completely detached from reality." Wedbush emphasized that the current large enterprise software ecosystem has accumulated trillions of data points, and emerging AI companies such as OpenAI and Anthropic are unlikely to fully take over these complex systems in the short term in terms of data hosting capacity and enterprise-level security. This means that AI is more likely to be embedded in existing software platforms as "embedded tools" rather than completely replacing them. Under the anxiety about AI, the software sector has recently experienced historic sell-offs. Wedbush pointed out that the IGV index, which measures the performance of the software industry, has fallen by about 18% since the beginning of the year, while the S&P 500 index has remained relatively flat. The market value of the software sector has evaporated by over $300 billion, reflecting the market's worst-case scenario pricing for the industry. The report indicated that the market's biggest concern is that AI may erode the traditional Software as a Service (SaaS) model based on seat licensing. Especially with the recent launch of AI tools by Anthropic that can automate high-value tasks in areas such as law, sales, and marketing, investors have widespread panic about the software industry's business model. In addition, new products like the AI assistant OpenClaw, which can automatically execute tasks across operating systems and applications, are also seen as potential threats to enterprise software vendors. At the same time, the skewing of enterprise IT budgets towards AI has also intensified the market's pessimistic sentiment. Wedbush cited research showing that about 80% of CIOs currently prioritize AI and machine learning, sparking concerns about "software budgets being squeezed by AI". However, the Ives team believes that this reallocation of budgets does not mean traditional software will be eliminated, but will instead strengthen the position of top platforms. At the individual stock level, Wedbush maintains an "outperform" rating for the five companies mentioned above, and provides clear long-term bullish rationales. For Microsoft Corporation, Wedbush maintains a target price of $575, believing that the acceleration of Azure cloud business and commercialization of AI will be key turning points by 2026. The analyst pointed out that despite fierce competition in the AI models field, Microsoft Corporation remains a core beneficiary of AI deployment with its large enterprise customer base and Microsoft 365 ecosystem. For Palantir, Wedbush maintains a target price of $230. The report states that categorizing Palantir simply as a "general AI software stock" is unreasonable, as its AI platform AIP is in strong demand in commercial and government sectors, particularly in critical task-oriented applications. As enterprises move from AI experimentation to actual deployment, the value of Palantir in "rapid deployment" and "results-oriented ROI" will become more prominent. For Snowflake, Wedbush maintains a target price of $270. Analysts believe that enterprises will not directly integrate cutting-edge models into production systems bypassing data platforms, and data governance, security, and permission management are still indispensable. This positions Snowflake as a "trusted intermediary layer" that connects enterprise data with external AI models. For Salesforce, Inc., Wedbush maintains a target price of $375. The report points out that the market underestimates Salesforce, Inc.'s moat in the AI era, as its high-quality enterprise data assets accumulated over many years are irreplaceable, and with Agentforce and the recent acquisition of Informatica, it is providing reliable context for AI agents. In the cybersecurity field, Wedbush maintains a target price of $600 for CrowdStrike. Analysts emphasize that the proliferation of AI will not weaken security requirements, but will significantly amplify the importance of network protection. CrowdStrike's Charlotte AI-driven security operations platform is gradually becoming the "AI-era network security operating system", and its industry-leading position remains unshaken by the volatility of the software sector. In conclusion, Ives summarized that although the software sector has recently become a "forbidden zone" in the eyes of investors, the real winners are emerging in this so-called "software doomsday", and the current extreme sentiment has created a rare window of opportunity for long-term investors.