• Source:JND

Investor fears that artificial intelligence will decimate the global software industry may be exaggerated, according to Matt Garman, CEO of Amazon Web Services. His comments come in the midst of a dramatic selloff that has erased more than $250 billion from global software stocks so far this month, as markets grapple with the implications of rapid advancements in AI-powered technologies developed by groups such as Anthropic and OpenAI.

“Much of the Fear Is Overblown,” Says AWS CEO

Speaking to CNBC, Garman said, “Much of the fear is overblown,” addressing what analysts have dubbed a "SaaSpocalypse". The market turbulence began after Anthropic released 11 open-source plugins for its Claude Cowork tool, triggering a global sell-off in software-as-a-service stocks across India, Japan, China, and the US.

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Garman acknowledged that AI is disruptive but argued that established SaaS providers still have an advantage. “There’s a huge disruption. AI is absolutely a disruptive force… but the large players of today have an inside track to winning that business,” he said, adding that companies must continue innovating or risk being displaced.

The sell-off has been widespread. Indian IT stocks tumbled as Wipro lost close to 5% and Infosys dropped 7.3%, while TCS hit its lowest level since September last year. Salesforce was also down by 4.8% in the US. Asia felt pressure, too: China’s CSI Software Services Index fell 3 per cent, while Japan’s Recruit Holdings lost 9 per cent.

Garman is undeterred by the volatility when it comes to AWS. AWS also makes money from big software companies such as Adobe, Intuit and Zillow, and it has signed significant AI-related contracts. OpenAI spent $38 billion with AWS in November 2025.

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“Our customers are going to consume more compute technology and more infrastructure than they ever have,” Garman noted.

Disruptive AI is no longer a concern for Software only. Logistics and legal tech stocks have suffered, too, after AI tools demonstrated that they could increase productivity without adding headcount. Legal-sector companies such as Thomson Reuters and RELX posted double-digit declines, suggesting that the fear of AI is spreading beyond advertising.


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