Is AI Really Eating SaaS… Or Reinventing It?

The SaaS industry is undergoing its most significant transformation in a decade. In early February 2026, over $285 billion in software market value was wiped out. The launch of Claude Cowork intensified concerns that agentic AI could undermine traditional SaaS models. Skepticism around SaaS economics and customer value had already been building, but AI amplified the “SaaSpocalypse” narrative and accelerated a structural shift beyond market volatility, reshaping buyer expectations from access to outcomes.

The key question: Is AI truly displacing SaaS? Pricing is evolving, moats weakening, and software build costs falling. Yet the story is more complex than headlines suggest. The structural strengths and resilient business models of SaaS companies point to a new phase of evolution rather than collapse. The future is not AI versus SaaS, but their convergence. 

Allied Advisers is pleased to publish this report to explore why the “SaaSpocalypse” narrative may be overstated and how SaaS and AI can coexist to create value for vendors, customers, and investors.

Download the full report here