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Fund Manager Warns: AI Threatens Application Software Stocks

2/16/2026

Summary

Story summary

Nick Evans, fund manager at Polar Capital, warns that application software stocks face an existential threat from AI.
Evans has sold most of his holdings in the sector.
Evans believes AI tools can replicate existing software and increase competition for established firms.
Evans has increased investments in infrastructure software companies such as Cloudflare and Snowflake.
Evans predicts a shakeout and advises underweight in application software, despite JPMorgan optimism.

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Story summary

Nick Evans, fund manager at Polar Capital, warns that application software stocks face an existential threat from AI.
Evans has sold most of his holdings in the sector.
Evans believes AI tools can replicate existing software and increase competition for established firms.
Evans has increased investments in infrastructure software companies such as Cloudflare and Snowflake.
Evans predicts a shakeout and advises underweight in application software, despite JPMorgan optimism.