On Monday, Oracle and several other software stocks dropped as investors shifted their focus back to popular AI hardware companies at the start of what was expected to be a quiet week for trading.
Before the market opened, Oracle shares fell. ServiceNow, Trade Desk, and Workday also saw declines. Meanwhile, chip and memory stocks like Intel and Micron rose across the board.
This year, software and semiconductor stocks have often moved in opposite directions. Investors have different opinions about how AI will impact each sector. Large language models need powerful chips, and demand for memory and networking hardware has grown as more data centers are built.
At the same time, many see AI as a possible threat to the software industry, especially with new AI coding tools that might replace some current products. These worries have hurt software stocks this year, attracting private-equity firms interested in buying at lower prices. According to a Reuters report last week, Silver Lake and Workday recently discussed a possible acquisition, citing people familiar with the situation.
