SNOW, MDB, PLTR: Is SaaS Losing Its Edge? Futurum Equities Says 95% of Software Could Become ‘AI Plumbing’

Following a brutal first-quarter software selloff, also dubbed SaaSpocalypse, where the market painted software stocks as clear AI losers, the narrative has drastically shifted.

A recent analysis by Futurum Equities deconstructs this turnaround. According to experts Shay Boloor, Sam Badawi, and Logical Thesis, 95% of SaaS isn’t entirely dead, but it will fundamentally transform into the backend “AI plumbing” powering new enterprise workflows.

The Interface Disappears, But The Work Remains

The market panic stemmed from fears that large language models would replace enterprise software. However, the analysts argue that while human interfaces may vanish, the underlying work—querying data, checking permissions, and running workloads—will actually multiply.

“95% of software will become the plumbing layer of the neogentic AI stack,” warns Boloor.

For Snowflake Inc. (NYSE:SNOW), a consumption-based model means that even if fewer employees are needed, “the number of queries are going to quadruple,” notes Logical Thesis. AI agents still need massive organizational context to make useful decisions, making data infrastructure hyper-critical.

Bearish Verdicts on High-Flying Valuations

Despite their bullishness on the underlying businesses, the analysts issued harsh verdicts on current stock valuations. Snowflake, now trading at a massive 150 times earnings, Boloor noted he doesn’t see what near-term earnings surprise could justify the stock’s premium, leading to a bearish consensus on SNOW’s immediate price action.

MongoDB Inc. (NASDAQ:MDB) faced more criticism, receiving a bearish sweep from the experts due to intense competition from open-source alternatives like free Postgres. Boloor offered a brutal assessment from the field, stating that while the product is sticky, “every engineer I talk to hates it.”

Meanwhile, Palantir Technologies Inc. (NASDAQ:PLTR) ignited a heated debate over whether any software stock deserves a hyper-premium valuation. While Badawi dubbed Palantir “the software of AI” alongside Nvidia Corp.’s (NASDAQ:NVDA) hardware, Logical Thesis dismissed PLTR as merely an “LLM wrapper” lacking proprietary technology outside its government moat.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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