<p>AI's disruption of traditional industries is casting a shadow over multiple sectors, with stocks in legal technology, financial data, software, wealth management, logistics, and commercial real estate being hit hard. Gene Munster, founder of a deep-water asset management company and a tech venture capitalist, believes that software companies urgently need a &#34;Google moment,&#34; similar to how Google successfully defended its search business last year; software companies need a similar situation to prove their own importance. Meanwhile, major bank Goldman Sachs recently launched a portfolio betting on companies that are not afraid of being replaced by artificial intelligence (AI).</p>
<h2>The Market is Becoming More Aware of the Coming Changes</h2>
<p>Tech venture capitalist Munster stated that AI has had a significant impact on productivity in the real world, mentioning that the CEO of music streaming platform Spotify previously revealed that the company's best programmers &#34;haven't written any code since last December.&#34; He believes this is significant because Spotify is not an AI-first company, yet its workforce is undergoing a transformation, &#34;the market is increasingly aware that this change is inevitably coming.&#34;</p>
<p>Munster believes that the long-term value of software companies depends on whether the number of robots in the workforce will eventually exceed the number of humans. If robots massively replace human employees, the demand for traditional software positions will significantly decrease, posing a threat to the profit models of giants like Salesforce. He also believes that companies facing AI disruption must actively respond, or they risk losing their market position, such as completely adjusting their hiring and infrastructure; otherwise, it will be difficult to continue achieving profit growth.</p>
<h2>Goldman Sachs Lists Companies Benefiting from AI Adoption</h2>
<p>Goldman Sachs recently launched a trading portfolio, buying into companies that are seen as difficult for AI to replace, while shorting companies whose workflows may increasingly be automated or internally replicated by AI. The bank is optimistic about businesses that may directly benefit from rising AI adoption rates, including computing power providers, data infrastructure, observability, cybersecurity, hyperscale cloud, and AI development platforms. The portfolio includes Cloudflare, CrowdStrike, Palo Alto Networks, Oracle, and Microsoft.</p>
<p>On the shorting side, it targets software workflows that may be automated or rebuilt internally as AI capabilities expand. These include Monday.com, Salesforce, DocuSign, Accenture, and Duolingo.</p>
<p>Faris Mourad, Vice President of Goldman Sachs' U.S. Custom Investment Portfolio team, wrote in a report: &#34;We expect the long positions in the portfolio to recover from the recent software sell-off, while the short positions will lag behind.&#34;</p>
<p>Recent market anxiety over AI disrupting traditional industries has intensified. Last week, AI startup Anthropic launched productivity tools for internal legal teams, triggering a significant sell-off in legal software and publishing stocks
After the little-known startup Altruist launched its tax strategy tool, the sell-off continued, causing the stock prices of companies like Charles Schwab and LPL Financial Holdings to drop by 10% or more over the past week.</p>
<p>Wall Street's skepticism towards software companies has persisted for months, but recent sentiment has shifted from cautious to completely defensive. As the market worries that generative AI may erode traditional business models and compress profit margins, investors have been selling off stocks in the industry.</p>
<p>Related article: AI Threats Spread, U.S. Stocks Suffer Another Sharp Decline; Former K Equipment Company Disrupts Logistics Industry CEO: Never Thought This Day Would Come</p>
<h2>Software Service Profit Growth Expected at 14%</h2>
<p>Additionally, the sell-off also involves a valuation reset. A year ago, the price-to-earnings ratio of software stocks reached 51 times, making the industry the most expensive in the stock market, while the latest price-to-earnings ratio for the industry is 27 times.</p>
<p>In terms of earnings expectations, analysts expect them to remain roughly unchanged. According to Bloomberg data, the software and services sub-industry is expected to achieve about 14.1% profit growth by 2026. Although this lags behind the broader technology industry's expected growth rate of 31.7%, it still exceeds the S&amp;P 500 index's expected growth of 13.7%</p>

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<p>The impact of AI on traditional industries is intensifying, especially in the software and technology sectors. The CEO of Spotify stated that since December last year, the company's programmers have not been writing code, indicating a trend of industry transformation. Goldman Sachs has launched a portfolio focusing on companies that are not easily replaceable by AI, such as Cloudflare, CrowdStrike, and Microsoft, while shorting companies that may be automated by AI. The market has gained a deeper understanding of the impact of AI, and the future value of software companies will depend on the ratio of humans to robots</p>

- AI is disrupting traditional industries, leading to significant losses in sectors like legal tech, finance, and software.  
- Analysts note that companies like Goldman Sachs are investing in AI-resilient firms while shorting companies that may face automation risks.  
- The market is increasingly aware of AI's transformative impact, raising concerns about profitability and necessitating adjustments in workforce strategies for software companies.

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AI severely impacts the outlook of software companies, Spotify has abandoned manual programming, Goldman Sachs customizes an "anti-AI investment portfolio" with 5 undefeated stocks