U.S. Software Sector Dips Amid Disruptive AI Fears
On January 29, 2026, the tech sector experienced a widespread decline. The S&P 500 Software and Services index fell by 8.7%, reaching a nine-month low, while several major publishers recorded significant drops.
Major Players Experience Sharp Declines
Microsoft saw a 12.1% drop after announcing a record expenditure in AI for the last quarter and slower growth in its cloud computing. SAP fell more than 16% following a warning about its cloud computing order book and its revenue forecasts for 2026. ServiceNow dropped 11% despite annual subscription revenue forecasts exceeding Wall Street estimates. Salesforce declined by 7.1%, Adobe by 3.9%, and Datadog by 8.3%.
Sectoral Shifts in the Market
The S&P 500 Software sector fell by more than 13%, while the Philadelphia SE Semiconductor index saw a significant rise on the same day.
Strategic Acquisitions Amidst Market Turbulence
ServiceNow announced the acquisition of cybersecurity startup Armis for $7.75 billion. Salesforce acquired the data management platform Informatica for $8 billion.
