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Some of the wealthiest software executives in the US have reportedly lost a combined $62 billion this year as fears grow that artificial intelligence could gut the industry’s most profitable businesses.
Eight of the 10 biggest wealth drops so far in 2026 have been among billionaires who built their fortunes in software, according to Bloomberg News.
The trio who founded AppLovin, the mobile advertising and technology platform, each lost around 30% of their net worth so far this year, with the stock falling by nearly a third.
Adam Foroughi, AppLovin’s CEO, has seen his personal net worth plunge from more than $27 billion in December to $17.3 billion as of Tuesday.
Foroughi’s co-founders, John Krystynak and Andrew Karam, have seen their fortunes dip 29.3% and 23.2%, respectively.
As of Tuesday, Krystynak has lost $2.4 billion year-to-date while Karam’s net worth has been subtracted by $2.8 billion.
Jim Goodnight, co-founder of SAS Institute, one of the world’s largest privately-held software companies, has seen his fortune fall 23.2% since Jan. 1 — losing approximately $3.3 billion, according to the Bloomberg Billionaires Index.
Oracle founder Larry Ellison has lost nearly $40 billion this year as shares of his company slid, knocking him to sixth place on the list of the world’s wealthiest moguls.
Bloomberg placed his net worth at $207 billion.
Coinbase CEO Brian Armstrong’s wealth is down 18%, with losses of roughly $1.8 billion year-to-date.
Hedge funds have ramped up their short bets against software stocks this year, focusing on companies that provide basic automation services that can easily be replaced by AI, according to a CNBC report.
Short-sellers have raked in a $24 billion windfall in software stocks so far this year as the overall market value in the industry plunged by $1 trillion, according to data from S3 Partners.
Earlier this week, Anthropic released its new Cowork platform, which includes a plugin designed to automate routine legal work — the latest example of AI appearing to do tasks once done by humans with software.
The legal plugin allows AI to perform tasks traditionally handled by lawyers, including contract review, risk flagging and more.
The tech raised the possibility that a general-purpose AI can now do the same work as a person on his or her computer at a fraction of the cost.
The announcement sparked a $285 billion selloff across software, financial services and asset management stocks.
LegalZoom shares plunged 20% while RELX fell as much as 17% and Wolters Kluwer dropped up to 13%.
Intuit shares slid 11%, as investors viewed accounting software as the next likely target for AI disruption.
Jensen Huang, CEO of AI chipmaker Nvidia, said that the selloff made no sense to him.
“It’s the most illogical thing in the world,” Huang said in comments that were reported Tuesday by Bloomberg News.
“There’s this notion that the tool is in decline and being replaced by AI. Would you use a screwdriver or invent a new screwdriver?”
Capital markets veterans say the tech wipeout isn’t just about artificial intelligence — it’s about money getting expensive.
“This isn’t just about AI. It’s about gravity,” said William Stern, founder of small-business fintech Cardiff.
“When money costs 5% or 6%, you can’t value a company on profits that might happen in 2030. That math doesn’t work anymore.”
Stern said investors are no longer willing to wait years for returns that may never materialize.
“The market is finally waking up and asking, ‘Where is the cash flow today?’” he said. “If you can’t answer that, your stock gets crushed.”
He argued that AI hype masked deeper problems in software valuations during the era of cheap capital.
“AI is real. But the valuations were fake,” Stern said.
“They were built on the idea that money would be cheap forever. Now that capital is expensive, investors are done with the fairy tales.”
Stern dismissed the idea that technological promise alone can sustain stock prices.
“You can’t pay a dividend with a language model,” he said.
“You need profit. That $62 billion drop is just the froth blowing off the top.”