Cramer Warns Market Overreacting in Software Selloff

Jim Cramer has expressed his opinion that the market has gone too far in selling down software names in 2026. He specifically mentioned Salesforce, ServiceNow, Cadence Design Systems, and Workday as companies that have been marked down sharply from a year ago despite beating earnings for four straight quarters and growing revenue by double digits.

Cramer argued that the market is pricing these companies as if their businesses have become worthless, which he believes is a harsher judgment than simply factoring in an earnings miss. He said that investors are treating profitable enterprise software companies as if their models are disappearing due to AI-fueled competition.

Cramer singled out Salesforce stock, saying it's trading at just 14x forward earnings, and pointed out that ServiceNow is down 22% despite 23% revenue growth and a 98% renewal rate. He also drew a distinction between Cadence Design Systems' physics-based silicon workflows and design tools like Adobe, saying the former are structurally too complex for AI agents to replicate.