{"id":185494,"date":"2025-10-02T17:31:16","date_gmt":"2025-10-02T17:31:16","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/185494\/"},"modified":"2025-10-02T17:31:16","modified_gmt":"2025-10-02T17:31:16","slug":"in-software-these-are-the-ai-proof-companies-according-to-analysts","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/185494\/","title":{"rendered":"In Software, These Are the ‘AI Proof’ Companies, According to Analysts"},"content":{"rendered":"

As hype around generative AI<\/a> continues to rattle the software sector<\/a>, more specialized software companies may be among the most resilient players and the most underappreciated.<\/p>\n

RBC Capital Markets wrote on Wednesday that vertical software \u2014 tools specifically designed for industries such as healthcare, insurance, and industrial design \u2014 could weather AI disruption<\/a> in the near term and benefit from it in the long run.<\/p>\n

These software vendors benefit from deep domain expertise, regulatory knowledge, and workflows that are difficult to replicate, the analysts wrote in a note to investors.<\/p>\n

“Vertical software is one pocket of software that is likely to be viewed as ‘AI-proof’ (for now),” the RBC analysts, led by Rishi Jaluria, wrote.<\/p>\n

‘Need-to-have’ software<\/p>\n

Vertical software often supports critical functions and is typically seen as “need-to-have,” not just “nice-to-have,” the report explained.<\/p>\n

With high customer retention, it could take years for these companies to be threatened by AI startups, even in a best-case scenario, the analysts argued. <\/p>\n

One such company, Clearwater Analytics, boasts gross revenue retention (GRR) rates of 98% to 99%, demonstrating the loyalty of its customers to the product. Gross revenue retention is a common metric for subscription-based businesses and software companies, measuring how effectively they maintain their existing revenue base.<\/p>\n

Additionally, many of the industries these companies serve are still in the early stages of modernizing their technology. That makes customers less likely to adopt AI-driven replacements in the near future.<\/p>\n

Over the longer term, RBC sees vertical software vendors playing a key role in shaping the next phase of AI adoption. Rather than merely supplying data, they can provide context to train and fine-tune AI models, leading to industry-specific AI tools that drive real productivity gains.<\/p>\n

Goldman Sachs’ view<\/p>\n

At a recent Goldman Sachs tech conference<\/a> last month, I asked Kash Rangan, the firm’s software analyst, about which companies could survive the AI challenge.<\/p>\n

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He highlighted ServiceNow, praising CEO Bill McDermott’s<\/a> battle-tested leadership. He also pointed to Intuit for creating value for its existing products by subtly adding AI into them.<\/p>\n

Salesforce got a more reserved assessment. Rangan said while CEO Marc Benioff<\/a> is “in the fight,” the company still needs to prove that its new Agentforce AI product is gaining traction with customers and that they’re willing to pay for it.<\/p>\n

In an industry dominated by flashy AI bets, RBC highlights a quieter reality: while vertical software may not be immune to threats by AI companies, its combination of industry entrenchment and domain-specific potential makes it a rare, AI-proof niche. For now, anyway.<\/p>\n

RBC’s AI software survivors<\/p>\n

Here are the vertical software companies that RBC recommended on Wednesday. RBC rates these all “Outperform,” citing their defensibility and their ability to innovate around AI:<\/p>\n

Autodesk: A design software company best known for AutoCAD and other tools used in architecture, engineering, and manufacturing.Bentley Systems: Provides infrastructure engineering software for the design, construction, and operation of roads, bridges, utilities, and other large-scale projects.Clearwater Analytics: Offers cloud-based investment accounting and reporting software for asset managers, insurers, and corporations.Guidewire: Develops cloud and software products for property and casualty insurers to manage underwriting, claims, and billing.Hinge Health: A digital health company specializing in musculoskeletal care, offering virtual physical therapy and pain-management programs.Samsara: Provides Internet of Things (IoT) platforms that help businesses manage physical operations, including fleet management, logistics, and industrial monitoring.PTC: Delivers software for product management, industrial IoT, and augmented reality to support manufacturers in designing and servicing products.Veeva Systems: Supplies cloud-based software tailored for the life sciences industry, including solutions for clinical trials, regulatory compliance, and customer engagement.<\/p>\n

Sign up for BI’s Tech Memo newsletter here<\/a>. Reach out to me via email at abarr@businessinsider.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"As hype around generative AI continues to rattle the software sector, more specialized software companies may be among…\n","protected":false},"author":2,"featured_media":185495,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[45368,62,11024,93252,3464,276,277,49,48,2539,18765,93251,56,93254,7481,17042,18036,93253,61,93250,1213],"class_list":["post-185494","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-abarrbusinessinsider","tag-ai","tag-ai-adoption","tag-ai-proof","tag-analyst","tag-artificial-intelligence","tag-artificialintelligence","tag-ca","tag-canada","tag-company","tag-customer","tag-gross-revenue-retention","tag-industry","tag-kash-rangan","tag-product","tag-rbc","tag-software-company","tag-software-vendor","tag-technology","tag-vertical-software","tag-wednesday"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/185494","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=185494"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/185494\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/185495"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=185494"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=185494"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=185494"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}