Hedge fund manager Eric Jackson, best known for his ultra-bullish call on Opendoor Technologies Inc. (NASDAQ:OPEN), is taking a bearish stance on SaaS stocks and he's betting against some of the biggest names.
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SaaS Shorts
In a post shared on X, Jackson revealed he's short Salesforce Inc. (NYSE:CRM), Asana Inc. (NYSE:ASAN), Five9 Inc. (NASDAQ:FIVN), DocuSign Inc. (NASDAQ:DOCU) and Atlassian Corp. (NASDAQ:TEAM) — all high-profile software-as-a-service (SaaS) stocks that once defined the cloud boom.
Jackson says his bearish position is rooted in what he calls the "AI Paradox."
After reading 716 corporate earnings transcripts, Jackson claims to have found a statistically significant pattern: the more a company talks about artificial intelligence, the worse its forward stock returns — by an average 5.4% relative to peers.
"The companies that talk about AI the most have the worst forward stock returns," Jackson wrote. "It's statistically significant. I call it the AI Paradox."
His thesis challenges the popular narrative that AI hype automatically translates to business growth. Many software executives, Jackson argues, have leaned heavily on AI buzzwords to excite investors rather than showcase operational results.
In essence, frequent AI mentions are a red flag — not a bullish signal.
Cybersecurity Longs
Still, Jackson isn't writing off the entire software universe. He singled out cybersecurity leaders like CrowdStrike Holdings (NASDAQ:CRWD), Zscaler Inc. (NASDAQ:ZS), and Palo Alto Networks (NASDAQ:PANW) as exceptions.
Unlike overhyped SaaS platforms, he believes AI genuinely strengthens these companies' core business value, enhancing detection, prevention, and automation capabilities.
Jackson's data-driven strategy lands as software multiples compress and investors rotate into hardware and infrastructure AI plays — such as Nvidia Corp. (NASDAQ:NVDA), Nebius Group (NASDAQ:NBIS) and Palantir Technologies, Inc. (NASDAQ:PLTR) — that visibly benefit from AI adoption.
His "AI Paradox" may ultimately capture a shift from storytelling to measurable execution as Wall Street reevaluates how much AI optimism is already priced in and what effect AI will have on the software industry.
Photo: Who is Danny / Shutterstock
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