BofA says AI panic is fading for software

Software just got a little less doom-and-gloom

Wall Street has spent a chunk of 2026 acting like AI was about to walk into the software aisle and start tossing products off the shelf. Now BofA Securities is basically saying: maybe not so fast.

The bank raised price targets on 10 software names Wednesday, including Adobe, ServiceNow, Snowflake, Workday, Figma, GitLab, Amplitude, Box, Asana and Zeta Global. The common thread isn’t that everyone suddenly deserves a gold star. It’s that investors appear more willing to pay up for software again as AI disruption fears ease and real AI monetization starts to show up in a few winners.

The sneaky part: it's a valuation call

BofA didn’t go on a forecasting shopping spree. It didn’t materially juice earnings estimates across the board. Instead, it raised the multiple it thinks the market should assign to those earnings.

That matters. It’s the difference between saying, “these companies are growing faster,” and saying, “the market has stopped treating them like they’re one chatbot away from extinction.” That’s a pretty big mood swing.

Who’s getting the love?

The bank seems to prefer companies with stronger growth and clearer AI monetization.

• ServiceNow got a higher valuation as current remaining performance obligations climbed 21.5%, subscription revenue rose 23%, and AI annual contract value crossed $1 billion.
• Figma is growing like a weed, with revenue up 48.2% year over year and more than 80% of larger customers using AI credits weekly.
• Snowflake got a vote of confidence too, with BofA seeing 22% revenue growth in calendar 2027 and a 25% free cash flow margin.

Adobe is the catch

Adobe got a higher price target to $220, but the rating stayed Underperform. In other words: nice target bump, still not exactly a standing ovation.

BofA expects Adobe’s growth to keep slowing, and it says AI-native and lower-cost competitors are making the creative-software battlefield messier, not simpler. So yes, the stock can rerate a bit — but the bank still thinks Adobe has to prove AI can be more than a buzzword in the earnings deck.

Big picture: the software trade is shifting from “Will AI kill this business?” to “Which software names can actually use AI to make more money?” That’s a much better question for investors — and a much more selective rally.