Software Stocks Extend Rally as AI Demand Optimism Breaks 'SaaSpocalypse' Narrative

Software stocks extended their rally on June 2, 2026, as fears of AI displacing enterprise software faded, driving the iShares Expanded Tech-Software ETF to a 21% gain in May—its best month since October 2001. The sector’s sharp reversal was fueled by Snowflake’s Q1 revenue of $1.39 billion, up 34%, and Dell’s AI server revenue surging 757% to $16.1 billion with a $51.3 billion backlog. Nvidia CEO Jensen Huang’s Computex keynote reinforced the demand case, framing agentic AI as a platform shift that elevates software’s role in enterprise infrastructure. ServiceNow rose 10%, extending its two-session gain to 26%. Sprinklr shares edged higher but remain down 18.1% year-to-date at $6.00, trading 35.9% below its 52-week high.