Why Thursday Could Be a Big Day for the Stock Market

Recent advancements by AI start-up Anthropic have fueled the recent sell-off in software stocks. Investors fear updates to its suite of productivity tools could reduce demand for some of the most popular SaaS offerings, taking down one of the largest segments of the software market and sparking the “SaaSpocalyse.”

Salesforce (NYSE: CRM) is widely recognized as a pioneer in SaaS and is the world’s leading cloud-based customer relationship management (CRM) platform. As such, fears about the future of its offerings have crushed the stock, which has fallen 30% since the start of 2026. Investors will be keeping a keen eye on the company’s results, as weakening demand could confirm investors’ worst fears.

For Salesforce’s fiscal 2026 third quarter (ended Oct. 31), revenue of $10.3 billion climbed 9% year over year, while EPS of $2.20 increased 38%. Perhaps more importantly, the company’s remaining performance obligation (RPO) — or contractually obligated revenue that hasn’t yet been recognized — grew 12% to $59.5 billion. When RPO grows faster than revenue, it indicates strong demand and generally bodes well for the future.

Management’s guidance seems to confirm that, as Salesforce is forecasting fourth-quarter revenue of $11.2 billion at the midpoint of its guidance, representing growth of 11%. Heavy investment in AI-related tools and services is expected to drag on its profits, with EPS down 15%. The company is also expecting its current RPO to climb 15%.

Salesforce is widely regarded as the godfather of SaaS and, as such, is a bellwether for the software industry. The company accounts for only 0.28% of the S&P 500’s weighting, but its results could provide insight into overall SaaS demand, which could fuel the market’s moves on Thursday.

Both Nvidia and Salesforce will be releasing their financial reports after the market close on Wednesday. Nvidia will provide keen insight into the ongoing demand for the chips that underpin AI. Similarly, Salesforce’s results and management’s commentary will likely offer clues regarding future demand for SaaS stocks.

That said, some believe the death of SaaS stocks has been greatly exaggerated. Huang was asked about the AI disruption of software and suggested the current panic is overblown. “There’s this notion that the software industry is in decline and will be replaced by AI.” He argues that AI will likely use existing solutions, rather than replacing them. “Would you use a hammer or invent a new hammer?” he asked. “There’s a whole bunch of software companies whose stock prices are under a lot of pressure because somehow AI is going to replace them,” Huang said. “It is the most illogical thing in the world.”

We’ll have a much clearer picture on Thursday.

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $424,262!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,163,635!*

Now, it’s worth noting Stock Advisor’s total average return is 904% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.

See the 10 stocks »

*Stock Advisor returns as of February 23, 2026.

Danny Vena, CPA has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia and Salesforce. The Motley Fool has a disclosure policy.

Why Thursday Could Be a Big Day for the Stock Market was originally published by The Motley Fool