Summary of Key Points
NVIDIA has released a new CPU, RTX Spark, which supports the local operation of AI agents on PCs, dispelling market concerns about AI disrupting traditional software and driving a strong rebound in the software sector. The IGV ETF, which tracks software stocks, has risen by 15.8% in three days, marking its best performance since 2001. Leaders such as ServiceNow and Adobe are leading the gains, with IBM even reaching new historical highs. The turnaround in the software sector is supported by logic such as AI improving efficiency and thus increasing demand for software, as well as improving corporate financial reports.
1. NVIDIA's New Hardware: Giving PCs the “Engine” to Run AI Agents – Yet Software Demand Is on the Rise
RTX Spark is a CPU (based on ARM architecture) that can be installed in laptops and mini-desktops, allowing ordinary Windows devices to run large models and AI agents locally (without relying on Apple’s Macs). Why has this sparked growth in the software sector?
Previously, there were concerns that generative AI (such as ChatGPT) would directly replace traditional software (for example, would writing reports no longer require Office?). However, it has become clear that with the widespread adoption of AI agents, companies need more software to manage them – for instance, to monitor whether AI is behaving improperly, how to store data, and how to ensure cybersecurity (as Jensen Huang mentioned, the popularization of home-use AI supercomputing will drive demand for data infrastructure, compliance, and security software). In other words, AI agents are like new cars, while software serves as the gas stations and traffic rules, leading to an increase in demand.
2. The “Reversal” in the Software Sector: From “AI Will Kill Software” to “AI Makes Software More Valuable”
The software sector suffered a significant decline earlier this year due to fears that AI would erode traditional software (for example, could Adobe’s Photoshop be replaced by AI-powered image generation?). But now the situation has reversed:
- Data Says It All: The amount of code uploaded to GitHub is expected to triple in 2026, and job vacancies for software engineers in the US have increased by 15% – indicating that AI is improving programmer efficiency, leading companies to hire more people rather than laying off staff.
- Improving Financial Reports: Cloud data platform Snowflake’s financial report last week exceeded expectations, causing its stock price to rise by 46%. Adobe, which was previously seen as a negative for the software sector, also saw a 5.72% increase – proving that software demand is recovering, and the previous downturn was an overreaction.
3. The “Growth Secrets” of Sector Leaders: Who Has Seized the AI Agent Trend?
- ServiceNow (Rose by Over 10%): A leader in automation process software, it now offers an “AI Control Tower” that helps companies manage all their AI agents and has acquired a security company, positioning itself well for the management needs of AI agents.
- Adobe (Rose by 5.72%): Previously, there were concerns that AI would replace its Photoshop with image generation tools, but with the overall recovery in the software sector and Adobe’s own efforts to integrate AI features (such as Firefly), these concerns have turned into positives.
- Snowflake (Rose by 46% Last Week): The surge in demand for cloud data storage due to AI has led to its financial report exceeding expectations, significantly boosting its stock price.
4. IBM Hits a New High: More Than Just Trump’s Praise – Multiple Positive Factors Are at Work
IBM’s stock price rose by over 8% on Monday, reaching a new historical high, for reasons beyond just an old video from Trump praising the company’s CEO for leading it to “new heights”:
- Overall Strength in the Software Sector: Market concerns about the software industry have eased, and IBM’s previously weak software business had led to lower expectations, so even small positive developments caused significant price increases.
- Government Support + Corporate Investment: The US government is investing $1 billion in building a quantum chip factory, and IBM itself is investing $10 billion over the next five years in quantum computing and $5 billion in expanding its Red Hat security business. Quantum computing is a future direction, and IBM is taking early steps in this area.
- Resilience to AI Disruption: Large companies rely on IBM’s “layered software ecosystem” (from underlying systems to advanced data tools), making it difficult for AI to replace such a robust infrastructure.
5. Future Growth Areas for the Software Sector
Based on current trends, the growth points for software demand are clear:
- Software for AI Agents: Tools for management, auditing, and compliance (such as ServiceNow’s control platforms).
- Cybersecurity Software: Increased data risks with the widespread use of AI are driving demand for security solutions (IBM Red Hat, ServiceNow’s acquired security businesses).
- Quantum Computing-Related Software: IBM’s investment in quantum computing will benefit related software products.
- Cloud Data Software: AI requires large amounts of data storage and processing capabilities (such as those provided by Snowflake).
In short, AI is not the enemy of software; rather, it acts as a catalyst, transforming software from a mere tool into a key enabler and supporter of AI, thereby increasing demand for related products.