"Under 'OpenAI delays IPO': Oracle and Nebius lead hardware stocks down, ServiceNow and Workday lead software stocks up across the board."

OpenAI’s financial troubles trigger a market reassessment; software stocks surge while chip stocks face pressure.

Wall Street Insights noted that on June 25, The New York Times reported that OpenAI may delay its IPO plans due to financial pressure, prompting the market to reassess how much AI will impact traditional software companies.

The software sector saw a broad rally on Friday. Previously, ServiceNow, Workday, and other companies were once viewed as the software stocks most at risk from AI; Oracle, which is deeply tied to OpenAI, bucked the trend and fell.

RBC Capital Markets analyst Rishi Jaluria said that while market sentiment toward the software industry as a whole remains somewhat negative, “the most pessimistic moment may already be behind us.” He also pointed out that the claim that “companies will use AI to fully replace existing software solutions” does not match reality.

Software stocks rally broadly; former “hard-hit area” leads the gains

The biggest standout gainers on Friday were software companies previously seen as most vulnerable to AI.

ServiceNow and Workday both rose by more than 9%, landing among the top gainers in the S&P 500 on the day.

(Top five gainers in the S&P 500)

Figma and Datadog closed up more than 10% and 8%, respectively; Adobe and Salesforce rose by about 5% each; Atlassian’s gain was also above 5%.

Raymond James analyst Adam Tindle noted, Although day-to-day stock price fluctuations are difficult to attribute precisely, the stocks that saw the biggest gains on Friday were precisely those that the market had been most worried would be cannibalized by AI—ServiceNow and Atlassian both fall into this group.

Oracle drops against the trend; cloud infrastructure business becomes a drag

In sharp contrast to the broad software rally, Oracle closed down by about 3% on Friday, becoming a clear outlier within the sector.

Morningstar analyst Luke Yang said that the news of OpenAI’s IPO delay is the main factor affecting Oracle’s stock performance.

Yang explained that this news is “good news” for the software applications side, but “bad news” for the cloud infrastructure side.

Oracle has a cloud computing cooperation agreement with OpenAI valued at up to $300 billion, which makes the outlook for part of Oracle’s business highly linked to OpenAI’s success or failure.

From the structure of Oracle’s own business, the importance of cloud computing has become even more prominent. In fiscal 2026, Oracle’s cloud business revenue grew 39% year over year to $34 billion, while software business revenue slipped slightly by 1% to $24.5 billion.

Cloud infrastructure firms face pressure; computing power suppliers face risks of downward expectation revisions

Dragged down by news of OpenAI’s financial troubles, emerging cloud infrastructure companies were unable to escape as well.

CoreWeave and Nebius Group both fell on Friday; their share prices closed down by about 2% and 6%, respectively.

Luke Yang noted that both companies are highly dependent on demand for AI infrastructure. If market expectations for OpenAI’s growth prospects become more conservative, the negative impact on the related cloud computing power suppliers will be more direct.

Dutch Asset investment manager Eric Jhonsa said on social media that the market is currently pricing a large amount of long-term terminal value risk into most SaaS companies, while for some AI infrastructure targets, almost no long-term risk has been factored in.

He further pointed out that progress in frontier large models such as GLM 5.2, export control policies, and the trend of companies shifting to smaller, cheaper models to compress token costs all indicate that AI computing power capital expenditures will also face uncertainty over longer time horizons.

Valuation divergence intensifies; AI infrastructure investment logic faces re-calibration

This market move has also pushed valuation divergence within AI-related stocks to the forefront.

Eric Jhonsa said that Nvidia is currently trading at about 20 times forward earnings, Broadcom at about 23 times, Marvell at 58 times, and Astera as high as 116 times, with the latter two also having a higher proportion of equity incentives relative to earnings and free cash flow.

He believes this divergence is “absurd,” and there is clear pressure for mean reversion.

At the same time, some SaaS companies, while continuing to sustain double-digit annualized growth in recurring revenue and free cash flow, have seen valuations compressed to 10 to 15 times forward free cash flow (excluding equity incentives). He believes this level offers a relatively good margin of safety.

On investment strategy, Eric Jhonsa said he is constructive on AI infrastructure targets whose valuations can be supported by capital expenditures remaining strong only through 2028 (rather than extending to 2030 or beyond). For targets that require a longer capex cycle to validate valuations, he takes a cautious, even bearish stance.

He added that buying AI infrastructure targets at 15 to 20 times expected earnings per share for 2028 is far more reassuring than paying more than 30 times.

At the macro level, Eric Jhonsa said that if inflation heats up again in the second half of the year, combined with the Federal Reserve responding more slowly due to political pressure, long-end interest rates could rise sharply. This would be the biggest macro threat facing current tech stock valuations.

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