Why This Tech Stock Is Dodging the AI "SaaSpocalypse"

After years of excitement driven by the artificial intelligence (AI) boom, technology stocks are getting clobbered. The tech-heavy Nasdaq-100 index is down about 3% year to date, and 4.5% in the past five days. Major AI hyperscalers like Alphabet, Amazon, Meta Platforms, and Microsoft have all lost value in the past five days, with Microsoft down more than 10%.Investors are getting skittish about AI stocks because of the huge capital expenditures they are laying out to build AI data centers. For example, Alphabet announced strong fourth-quarter earnings on Feb. 4, with a 30% year-over-year increase in net income. But its stock dropped the next day. Investors apparently are concerned about Alphabet's plans to spend $175 billion to $185 billion on capex in 2026. That would be more than Alphabet's entire net income for 2025 ($132 billion).An even bigger downturn is hitting software-as-a-service (SaaS) companies. The iShares Expanded Tech Software ETF, which has software majors like Microsoft, Salesforce, and ServiceNow in its portfolio, is down about 25% year to date.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool