GoKawiilSridhar Ramaswamy, CEO of Snowflake, helps ring The Closing Bell at the New York Stock Exchange on Sept. 30, 2025.
The "SaaSpocalypse" may not be over. But for now at least, fears of software's demise have cooled.
Software stocks soared this week, driven by strong results from Snowflake and Okta , signaling that some companies are navigating their way through artificial intelligence disruption better than Wall Street expected.
The iShares Expanded Tech-Software exchange-traded fund rose 8% this week and closed May up 21%, the best monthly performance for the ETF since October 2001. Back then it was a brief rebound during the dot-com bust, while the current rally comes as concerns about the impact of AI ripple across the sector.
Software names have been hit particularly hard over the past year due to the boom in so-called vibe coding, with users able to now build apps and websites in minutes thanks to offerings from Anthropic, OpenAI and others.
With this month's rally, the iShares software ETF is only down 3.8% for the year, still badly trailing the Nasdaq, which has gained 18% in 2026.