‘Software firms not endangered but AI-era beneficiaries’: Ajay Bagga Backs Nvidia CEO's view
Jensen Huang, the CEO of Nvidia, believes AI’s growth will likely enhance software utility rather than diminish it.
- Feb 26, 2026,
- Updated Feb 26, 2026 9:58 PM IST
A growing debate is unfolding in global markets over whether artificial intelligence will hollow out traditional software companies — or reinforce them as the backbone of the next technological era.
Market veteran Ajay Bagga, in a recent post on X (formally twitter), highlighted comments by Jensen Huang, the CEO of Nvidia, who argued that investors may be misreading the impact of AI on software firms.
According to Bagga, Huang’s core thesis is that “the market got it wrong” on software companies, especially fears that AI will render them obsolete.
AI as a tool user, not a tool replacer
Huang’s argument rests on three central behavioural and economic points.
First, AI agents are “tool users, not tool replacers.” In other words, AI systems rely on existing software stacks, databases and enterprise platforms to function effectively. Rather than eliminating traditional software, they are layered on top of it.
Second, software remains the backbone of enterprise operations. From payroll systems and compliance frameworks to customer relationship management and supply chain tools, enterprise software forms the digital plumbing of modern corporations — infrastructure that AI cannot simply displace.
Third, Huang believes AI’s growth will likely enhance software utility rather than diminish it. As AI becomes embedded in workflows, demand for structured data, secure systems and interoperable platforms could rise, strengthening the role of established software providers.
"This frames software firms not as endangered by AI, but as core infrastructure beneficiaries in the AI era," Bagga wrote.
Parallel warning on jobs
Yet even as Huang pushes back against fears of software extinction, another anxiety is intensifying: the impact of AI on white-collar employment.
The latest advances in artificial intelligence are no longer confined to research labs. They are reshaping the foundations of knowledge work — particularly at the entry level.
From drafting reports and analysing spreadsheets to writing code and handling customer queries, tasks that once formed the core of junior roles are increasingly being handled by AI systems developed by companies such as OpenAI, Google and Microsoft.
What began as a productivity narrative is now being viewed by some experts as a structural shift in how work itself is organised.
Bagga underscored this disruption in another post, citing comments from Dario Amodei, CEO of Anthropic.
“Dario Amodei, who is probably the most safety-focused CEO in the AI industry, has publicly predicted that AI will eliminate 50% of entry-level white-collar jobs within one to five years. And many people in the industry think he’s being conservative,” Bagga wrote.
He added that the capability for massive disruption could be here by the end of this year. “It’ll take some time to ripple through the economy, but the underlying ability is arriving now,” he said.
A growing debate is unfolding in global markets over whether artificial intelligence will hollow out traditional software companies — or reinforce them as the backbone of the next technological era.
Market veteran Ajay Bagga, in a recent post on X (formally twitter), highlighted comments by Jensen Huang, the CEO of Nvidia, who argued that investors may be misreading the impact of AI on software firms.
According to Bagga, Huang’s core thesis is that “the market got it wrong” on software companies, especially fears that AI will render them obsolete.
AI as a tool user, not a tool replacer
Huang’s argument rests on three central behavioural and economic points.
First, AI agents are “tool users, not tool replacers.” In other words, AI systems rely on existing software stacks, databases and enterprise platforms to function effectively. Rather than eliminating traditional software, they are layered on top of it.
Second, software remains the backbone of enterprise operations. From payroll systems and compliance frameworks to customer relationship management and supply chain tools, enterprise software forms the digital plumbing of modern corporations — infrastructure that AI cannot simply displace.
Third, Huang believes AI’s growth will likely enhance software utility rather than diminish it. As AI becomes embedded in workflows, demand for structured data, secure systems and interoperable platforms could rise, strengthening the role of established software providers.
"This frames software firms not as endangered by AI, but as core infrastructure beneficiaries in the AI era," Bagga wrote.
Parallel warning on jobs
Yet even as Huang pushes back against fears of software extinction, another anxiety is intensifying: the impact of AI on white-collar employment.
The latest advances in artificial intelligence are no longer confined to research labs. They are reshaping the foundations of knowledge work — particularly at the entry level.
From drafting reports and analysing spreadsheets to writing code and handling customer queries, tasks that once formed the core of junior roles are increasingly being handled by AI systems developed by companies such as OpenAI, Google and Microsoft.
What began as a productivity narrative is now being viewed by some experts as a structural shift in how work itself is organised.
Bagga underscored this disruption in another post, citing comments from Dario Amodei, CEO of Anthropic.
“Dario Amodei, who is probably the most safety-focused CEO in the AI industry, has publicly predicted that AI will eliminate 50% of entry-level white-collar jobs within one to five years. And many people in the industry think he’s being conservative,” Bagga wrote.
He added that the capability for massive disruption could be here by the end of this year. “It’ll take some time to ripple through the economy, but the underlying ability is arriving now,” he said.