AI Loser Software Stocks Struggle as Hardware Earnings Jump

Europe’s software companies are set for slower earnings growth than their hardware counterparts this year, compounding fears in global markets that artificial intelligence will reshape software firms’ business models.

Europe’s software companies — the firms whose services could be disrupted by the advent of more sophisticated AI tools, including SAP SE, Dassault Systemes SE and Reply SpA — are expected to see earnings-per-share growth slow to 13% compared with 17% last year, Bloomberg Intelligence data shows.