Nvidia chief executive Jensen Huang said this week that software is not being replaced by AI, even as shares of software companies fell across several Asian markets.
His comments came after a decline in global software stocks following the release of an updated chatbot by Anthropic.
Investors reacted to the release by selling shares in companies linked to data services, outsourcing and enterprise software, particularly in Asia.
Speaking at an artificial intelligence conference in San Francisco organised by Cisco, Huang said the idea that software tools are becoming less important is ‘illogical’.
“There’s this notion that the tool in the software industry is in decline, and will be replaced by AI … It is the most illogical thing in the world, and time will prove itself,” he said.
Huang said advanced systems rely on existing software rather than replacing it. He compared the process to how people and machines use tools that already exist instead of building new ones from scratch.
“If you were a human or robot, artificial, general robotics, would you use tools or reinvent tools? The answer, obviously, is to use tools … That’s why the latest breakthroughs in AI are about tool use, because the tools are designed to be explicit.”
Markets continued to fall during the week. In India, shares of IT exporters dropped sharply, with the sector index losing 6.3%. Infosys was among the worst hit, falling 7.3%.
In China, the CSI Software Services Index fell 3%. Shares of Kingdee International Software Group dropped more than 13% in Hong Kong. In Japan, Recruit Holdings fell 9%, while Nomura Research declined 8%.
Huang has made similar comments in recent months, describing intelligent systems as infrastructure rather than replacements for software. At an industry event in Houston earlier this year, he said such systems would be built into existing platforms and tools.
Nvidia is continuing to expand its investments in large-scale computing and industrial applications. The company is also in talks over a major investment in OpenAI and is increasing capacity to support growing demand for computing power.
The recent market reaction emphasises concerns about how new systems could affect data services and outsourcing. Huang said those systems still depend on software to operate, integrate and scale.
For now, the selloff has not changed Nvidia’s position. The company believes that software is indispensable to how the technology is used.
