An AI-Rally for Software Makers Will Demand Investor Patience

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Investors need more patience for the euphoria about artificial intelligence to lift the stocks of software makers. While hardware manufacturers are experiencing surging demand for AI infrastructure, software companies are struggling to convince the market of similar growth. The Philadelphia Stock Exchange Semiconductor Index has climbed 16% this year, supported by makers of chips and servers such as Nvidia Corp., while an index of software stocks has gained less than 4%. Software firms are expected to achieve less than half the earnings growth of semiconductor peers in 2024. However, investors view the impact of AI on software companies as a matter of time, as companies like Adobe and Microsoft are already making efforts to incorporate AI into their products.

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https://finance.yahoo.com/news/ai-rally-software-makers-demand-114712109.html