A significant selloff in shares of European companies leveraging artificial intelligence (AI) has intensified, raising concerns about their sustainability amidst emerging AI models. Prominent stocks, including Germany’s SAP and France’s Dassault Systemes, saw declines following a downgrade of U.S. competitor Adobe. Key European firms, such as LSEG, Sage, and Capgemini, experienced drops of up to 14.4% since mid-July. Investors initially supported these “AI adopters” as a means to capitalize on the AI surge, yet the rapid advancement of AI technologies, exemplified by OpenAI’s GPT-5 and Anthropic’s Claude, has led to speculation about the viability of their business models. Despite gains in broader European markets, high price-to-earnings ratios render these stocks vulnerable. Experts argue for a more discerning market approach, suggesting not all software firms will be equally affected by AI advancements, emphasizing the importance of proprietary data and embedded customer relationships for resilience.
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