Goldman Sachs CEO Solomon describes the software sell-off as 'overdone' while Wall Street aims to reassure investors

Goldman Sachs CEO Urges Calm After Software Sector Sell-Off

David Solomon, CEO of Goldman Sachs (GS), addressed the recent steep decline in software stocks, describing the market reaction as overly sweeping. Speaking at a UBS financial services event in Key Biscayne, Florida, Solomon emphasized that while some companies may face challenges, others will adapt and thrive, urging investors to remain patient amid concerns about AI's impact on the sector.

Solomon's remarks came after leaders in the alternative investment space attempted to ease investor worries during their recent earnings discussions.

Last week, major private equity firms such as Apollo Global Management (APO), Ares Management (ARES), Blackstone (BX), and KKR (KKR) experienced stock declines, reflecting their ties to software companies that could be affected by advancements in artificial intelligence.

Smaller alternative asset managers, including Blue Owl (OWL), also faced heightened pressure. Blue Owl's CEO, Marc Lipschultz, strongly criticized the recent sell-off during the company's February 5 earnings call, arguing that the notion of large corporations abandoning their software in favor of AI tools like ChatGPT is unrealistic. He encouraged listeners to consider the perspective of Nvidia CEO Jensen Huang on the matter.

Solomon noted that Goldman Sachs is closely watching how AI developments might disrupt software businesses, but he reassured that the bank's exposure to this sector is minimal in the context of its overall operations.

Positive Outlook for Dealmaking in 2026

Looking ahead, Solomon expressed optimism about the prospects for mergers and acquisitions, as well as broader capital markets activity in 2026. He predicted a favorable environment for dealmaking in the coming year.

Goldman Sachs CEO David Solomon speaks at the Economic Club of Washington, D.C., October 30, 2025. (REUTERS/Kevin Lamarque)

Goldman Sachs reported one of its most successful years for dealmaking and trading in 2025, entering 2026 with strong momentum.

According to Dealogic, global investment banking revenue has risen by 10% so far this year, fueled by increased M&A and bond issuance activity.

Notable transactions in 2026 include SpaceX's acquisition of xAI, as well as significant bond offerings from technology giants Oracle (ORCL) and Alphabet (GOOG), both of which are making substantial investments in response to the ongoing AI surge.

Further Reading

David Hollerith reports on the financial industry, covering everything from large national banks and regional lenders to private equity and the cryptocurrency market.