OpenAI just handed software stocks a beating with its latest push into enterprise work.
After the company revealed a new product on Wednesday meant to make AI agents more effective for customers, software stocks like Workday, Atlassian, and HubSpot tumbled.
The product, called Presence, ramps up OpenAI's competition with established software vendors. As Business Insider first reported, the tool lets companies create guardrails, permissions, and policies around how AI agents use company data. It's meant to automate work in customer support, sales, internal processes, and other areas.
The release is part of OpenAI's broader strategy to build software capabilities and governance on top of its AI models. It pushes OpenAI further into the SaaS, or software-as-a-service, market, where established companies have been on edge about the impacts of AI coding tools and AI agents.
Stocks in the sector fell on Wednesday and Thursday — already a tough stretch amid an oil price surge, rising bond yields, and worrying Big Tech earnings.
Since Wednesday morning, share prices have dropped for Workday (-9.9%), Atlassian (-11.8%), HubSpot (-12.7%), Salesforce (-7.7%), and Okta (-4.2%).
In a note to investors, TD Cowen analysts wrote that the Presence announcement was likely a "major reason" for a 3% sell-off in the IGV software index on Wednesday and further declines on Thursday.
"Presence is being marketed with much of the AI Agent capabilities that SaaS vendors pitch, including packaging LLM reasoning + data access + governance/policy control," the analysts wrote.
Derrick Wood, a tech analyst from the TD Cowen team, told Business Insider that among the business applications companies that overlap with Presence, he sees the customer service and sales fields as particularly exposed.
Wood pointed back to early October for precedent, when a series of blog posts from OpenAI showcased internal AI tools. The tools resembled SaaS offerings, and OpenAI's posts sent software stocks like HubSpot, DocuSign, and ZoomInfo reeling.
At the time, TD Cowen analysts wrote that the reaction was overblown, but noted, "days like this remind investors of how much concern there is in the market around 'AI eating software'."
OpenAI did not respond to a request for comment.
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