AI Disrupts Software Sector as Meat Industry Offers Tangible Hedge

Published in Market Analysis

AI Disrupts Software Sector as Meat Industry Offers Tangible Hedge

As tech giants stumble, physical commodities are becoming the ultimate safe haven.

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Bo Pedersen

Chief Revenue Officer

The AI Disruption Hammers Software Stocks

The recent weeks have seen a certain amount of turbulence in the stock markets around the world. Previous investor favourites have seen their fortunes turn for the worse. Over the past several decades, technology companies, and software companies in particular, have out performance most other sectors.

Key Details

  • The Boom: In the five years from November 2016 to November 2021, the index grew 249.54%, for an annualised return of 28.44%.

  • The Stagnation: Since 2021, the numbers tell a different story. Since the 2021 peak, over the next nearly four years, the index grew only 9.71%, in total, for an annualised return of 2.43%.

  • The Collapse: Since the September 2025 peak, the index has lost 25.11% of its value, for an annualised return of negative 48.93%!

Market Context: The Artificial Intelligence Catalyst

So what's going on? In short, Artificial Intelligence, or AI. AI represents one of the single greatest and potentially most disruptive technology innovations ever. And this time it is the previous generation of disrupters that are facing the most severe challenges.

Companies that spent billions of dollars, over decades, developing software applications with attractive user interfaces, automating complex workflows, presenting and processing data, and much more, are now finding that their so-called technical moats are can be easily overcome with the aid of artificial intelligence.

Supplier Check: SAP

  • Share Price Plunge: SAP, a large German software company with many customers in the meat industry has found its share price collapsing by more than 36% in the past year.

  • Restructuring Expected: SAP is a well-run company, comfortably profitable, and with a diversified product portfolio serving customers across many countries and industries. However, the management of SAP is going to take action to improve the performance and future prospects of the business to persuade investors to come back. This usually involves taking a close look at the performance of different products, business units, in terms of revenue and costs. Inevitably, the response will involve some combination of reducing costs, and refocusing efforts on the strongest products and business units.

Meat Industry as a Tangible Alternative

In some ways, this upheaval in the software industry has very little to do with the meat industry. However once you look more closely, we find several ways in which the AI revolution will impact the meat industry.

Now consider Cranswick Plc. Cranswick is a vertically integrated meat products manufacturer based in the UK. Since going public in 1988, 38 years ago, the company has delivered annualised returns of 13.76%.

The Performance Spread

  • Sluggish Software Era: Comparing Cranswick to the S&P Software & Services index, in the 'sluggish' period between November 2021, and September 2025, company grew 41.09% for an annualised return of 9.38%.

  • AI Crash Era: And since then, during the AI induced crash in software company share prices, Cranswick grew an additional 7.57%.

  • Broader Market Context: The broader meat industry has not performed quite as well, with lower annualised returns and generally lagging behind Cranswick's specific vertically integrated model.

What might this mean for Meat Industry companies?

  • Greater access to capital: As investors exit technology and software companies, they need new and better places to invest their capital. Meat industry companies may offer such an alternative. You don’t need to be a publicly traded giant like Cranswick to benefit from this trend.

  • Leverage over software suppliers: Software companies are hyper focused on retaining existing customers. Now is a great time to review the pricing and performance of your software and technology suppliers to make sure you are getting value for money. Suppliers will be highly sensitive to customers who might be at risk or terminating or reducing their contracts.

  • Consider how AI can improve your business: As opposed to earlier waves of new technologies, AI does not require any special skills or experience to use it. Anyone can and should be working with AI, just start with the free versions of ChatGPT, Microsoft Copilot or Google Gemini, and you’ll be amazed at what it can do. It most likely speaks your language too, almost regardless of where you’re from.