Enterprise software—large-scale tools designed for organizations and business clients—is experiencing a slump as providers and customers alike navigate the shifting AI landscape, the inertia baked into existing systems, and uncertainty about the future of software-as-a-service (SaaS) companies. This is reflected in the declines in the share prices of major providers like ServiceNow (NYSE: NOW) and IBM Corp. (NYSE: IBM) this year. These stocks have fallen by about 40% and 20% year-to-date (YTD), respectively.
One way for investors to play this trend is to buy while prices are relatively low. If the enterprise software industry can successfully adapt to the shifting landscape—that is, if companies can either integrate AI into their existing products or shift their focus to bypass the threat of AI entirely—they may be able to resurge. The exchange-traded funds (ETFs) below may help investors who are optimistic about the space gain easy exposure.
