- According to HSBC analysis, AI companies are unlikely to completely replace the software market due to a lack of deep industry experience and understanding of business needs.
- Instead of “devouring” SaaS, the main trend is collaboration between AI companies and traditional software enterprises to serve customers.
- Fears of a “SaaSpocalypse” emerged when AI products like Anthropic (Claude) or OpenAI (Codex) made investors worry that SaaS would be replaced.
- Major US software companies like Salesforce and Adobe saw their values drop by about 30% during the year.
- In China, the Hang Seng China A Software & Services index also fell 19% from its January peak.
- However, the reality of the Chinese market differs from investor sentiment: SaaS companies are integrating AI and reporting strong growth.
- Kingdee International Software Group forecasts AI revenue to reach 1 billion yuan (≈$146 million), an increase of 180%.
- The Chinese SaaS market is less developed than that of the US, so AI becomes a driving force rather than a replacement.
- AI helps improve existing software products rather than eliminating their role in the enterprise.
- The result is a “symbiotic” model: AI + traditional SaaS growing together to better serve businesses.
📌 Contrary to fears that AI will “wipe out” SaaS, in China, AI is becoming a growth engine. With Kingdee’s AI revenue increasing by 180% to about $146 million and the SaaS market still having plenty of room for expansion, the collaboration model between AI and traditional software is prevailing. This shows that AI is not a replacement but a catalyst helping the software industry accelerate powerfully in the new era.
