AI threat shakes European software: SAP and Sage lose up to 6%

Shares in Europe's leading technology companies plummeted Tuesday amid growing fears that artificial intelligence will erode their competitive position. According to Bloomberg, the punishment follows a weak session on Wall Street on Monday, in which companies like Monday.com and C3.ai reported results that rekindled investor concerns .

SAP led the declines in Europe. At market close, it posted a 6.73% drop. Sage closed down 4.47%; Nemetschek, 10.44%; Sinch, 3.05%; and Dassault Systèmes, 2.43%. In addition, a European software stock index compiled by UBS fell 3.5%, according to Bloomberg.

In the US , Adobe fell 2.2% on Monday after Melius Research, a company dedicated to research, data analysis, and investment, downgraded it to "sell," warning that AI could become a growing competitor . Salesforce (-3.3%), Intuit (-5.7%), and Workday (-3.8%) also closed lower.

Monday.com lost 30% on Monday despite meeting market expectations , punished by weaker-than-expected revenue growth for 2025 and fears that AI will impact the entire application software industry in the long term . Still, today's session saw a gain of nearly 1.0 percentage point. C3.ai, meanwhile, plummeted 26% after reporting preliminary revenue that fell far short of estimates. It rebounded today with a 1.4% gain.

Jefferies analyst Brent Thill noted that concerns are "overblown" and that there are buying opportunities, according to Bloomberg. Similarly, investment bank RBC Capital Markets said sector valuations are suffering from the "end of software" narrative driven by AI, despite companies improving their revenue performance in the second quarter and maintaining solid fundamentals.