BNP Paribas analyst Stefan Slowinski thinks the software market might be a little too gloomy. In a new note, he points to rising hiring demand and a string of upcoming investor events as reasons to take a second look at the sector.
Slowinski highlights that demand for software engineers continues to climb, with hiring up 18% year over year. That's not just a number—it's a signal that companies are investing in building and deploying software, even if the stock market has been skeptical lately.
The analyst points to Atlassian Corp. (TEAM) as a case in point. Shares surged 30% after strong results driven by seat growth, reinforcing the view that AI could expand both seat-based and consumption-based opportunities. "Broader adoption of software across enterprises may require more engineers and tools," Slowinski notes, adding that AI-driven customer engagement could also boost Sales and Marketing functions.
Despite this backdrop, he believes the market has become overly negative on some software vendors. The bearish narrative on Software-as-a-Service (SaaS) might be overdone.
AI Debate To Dominate Investor Events
This week, ServiceNow, Inc. (NOW), International Business Machines Corp. (IBM), and Atlassian are all hosting conferences and analyst days. Slowinski expects AI to be the central theme, but he doesn't anticipate major monetization milestones. Instead, companies will likely focus on outlining their AI strategies, especially following recent developments in agentic coding tools.
He adds that investors probably won't find clear evidence that challenges bearish SaaS narratives, though the hiring data offers some support. The real story might be in the product roadmaps and customer conversations.
Product Roadmaps And Customer Data In Focus
Slowinski expects companies to use these events to detail product pipelines and highlight customer use cases that could signal future growth catalysts. Investors will pay close attention to updates on pricing, packaging, and adoption trends, particularly for AI offerings. He also plans to assess enterprise AI adoption trends through discussions with customers and sales teams, as companies position themselves for potential revenue acceleration in the coming years.
Price Action: IBM shares were down 0.70% at $230.57, ServiceNow shares were up 2.57% at $93.50, and Atlassian shares were up 6.84% at $94.95 at the time of publication on Monday, according to market data.
