Software company ServiceNow (NOW) has had a rough 12 months, down nearly 50%. The company’s business strategy has come under fire as it expanded through a series of acquisitions, and analysts began questioning whether some of the company’s core services would be disrupted by emerging artificial intelligence (AI) platforms. Dan Ives and Wedbush Securities are breathing some new life into the enterprise software company, however. Wedbush recently announced that it was reinstating ServiceNow to its IVES AI ...

Core Viewpoint - The software sector experienced a significant sell-off, with the iShares Expanded Tech-Software Sector ETF (IGV) dropping 19% from January 26 to February 5, but Morningstar believes the fears surrounding AI's impact on the industry are exaggerated and presents a buying opportunity [1][2]. Group 1: Market Performance and Analyst Insights - Morningstar's senior equity analyst, Dan Romanoff, stated that there is little evidence supporting the bear case for software stocks, as retention rates and other metrics remain solid [2]. - Despite the sell-off, software stocks showed signs of recovery, with IGV rising 3% and the Nasdaq increasing by over 2% on a recent Friday [3]. - Romanoff identified Microsoft (MSFT) and ServiceNow (NOW) as having substantial upside potential, with shares down 17% and 35% year to date, respectively [4]. Group 2: AI Impact and Revenue Generation - Concerns that AI will significantly disrupt the software industry may be overstated, as many firms still view AI with skepticism [5]. - AI products currently account for approximately 2% of revenue for software vendors, indicating that they are not generating substantial revenue [6]. - Historical instances of automation have not led to major disruptions in labor markets, suggesting that current fears may not materialize [6]. Group 3: Future Outlook and Employment Trends - While there may be future pressure on seat counts, there is no current evidence of this affecting sales representatives, as seen in the historical context of Salesforce's CRM approach [7]. - Headcount across functional areas continues to increase, indicating that fears of job losses due to automation are not currently reflected in the market [7].

Core Insights - Anthropic, co-founded by Dario Amodei, is expanding its operations in India, planning to establish an office in Bengaluru and explore a partnership with Reliance Industries, indicating a strategic move to strengthen its presence in the Indian market, which is its second-largest after the U.S. [1][2] Group 1: Partnership and Market Expansion - Amodei is set to meet Mukesh Ambani and senior executives at Reliance Industries to discuss a potential partnership aimed at expanding access to Anthropic's Claude AI assistant in India [2] - India, with over a billion internet subscribers, is a crucial growth region for Anthropic, as several Indian AI startups are already utilizing its Claude models for both domestic and U.S. clients [3] - The country ranks second in traffic to Claude's website, following the U.S., highlighting its significance in Anthropic's global strategy [3] Group 2: Industry Collaborations - Reliance Industries has been actively partnering with major tech companies, including Google and Meta, to develop AI infrastructure and enterprise solutions through its new unit, Reliance Intelligence [4] - There were discussions for a collaboration between Reliance and OpenAI, which was anticipated to be announced during OpenAI CEO Sam Altman's visit to India, although the trip was postponed [5] Group 3: Government Engagement - Amodei's itinerary includes meetings with top lawmakers and senior federal government officials in New Delhi, with plans to meet Indian Prime Minister Narendra Modi [6] Group 4: Office Opening and Developer Engagement - Anthropic's office opening in Bengaluru is scheduled for Thursday, with key executives from the company accompanying Amodei [7] - Prominent venture funds, including Accel and Lightspeed, are organizing sessions with Anthropic executives to discuss how developers and startups can leverage Claude for their offerings [7]

Core Viewpoint - The article compares two major AI stocks, Oracle and Amazon, to determine which is a better investment choice currently Group 1: Oracle - Oracle's stock has increased by 79% over the last three years, outperforming the S&P 500's 26% growth during the same period [2] - The surge in Oracle's stock is attributed to rising demand for AI data centers, leading to improved revenue growth [4] - In the most recent quarter, Oracle's total revenue rose by 6% year over year to $14.1 billion, with cloud services revenue growing by 10% [4] - Although the 6% growth is lower than the double-digit gains seen in 2023, it exceeds the company's 10-year average of 4% [5] - Oracle is investing heavily in new data centers to increase its market share in the cloud services sector, aiming to compete with major players like Amazon, Microsoft, and Google [7] - The bullish case for Oracle hinges on the increasing demand for AI data centers, which could justify its price-to-earnings ratio of 34 and significant capital expenditures [8] Group 2: Amazon - Amazon is the largest cloud services company, with its AWS division generating over $100 billion in annual revenue and holding a 30% share of the global cloud services market, compared to Oracle's 3% [9] - Amazon is developing its own AI chips, known as Trainium, to reduce costs and reliance on suppliers like Nvidia [10] - The company has invested $8 billion in Anthropic, a startup focused on AI solutions, which could enhance Amazon's operations [11] - Amazon's extensive e-commerce business provides numerous opportunities to leverage AI for efficiencies and cost savings, potentially improving profitability [12] - Amazon is characterized as an AI conglomerate pursuing multiple pathways to benefit from the AI boom, beyond just data center growth [13] Group 3: Investment Considerations - The choice between Oracle and Amazon depends on the investor's focus; Oracle may be preferable for those concentrated on data center growth, while Amazon offers a broader range of AI initiatives [14]