What Happened?
Shares of business intelligence platform Domo (NASDAQ: DOMO) fell 6.4% in the afternoon session after a broad sell-off swept through the software sector, driven by growing concerns about the impact of artificial intelligence. This led to institutional repositioning as traders pivot away from traditional SaaS providers in favor of companies with more defensible, AI-integrated moats. The tech-heavy Nasdaq Composite index declined by 0.8%, while the broader S&P 500 also slipped.
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What Is The Market Telling Us
Domo’s shares are extremely volatile and have had 43 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock dropped 5.6% on the news that a broad sell-off in the software sector was triggered by mixed earnings from industry leaders SAP and ServiceNow.
The negative sentiment across the industry was sparked after SAP's cloud backlog and its cloud revenue outlook fell short of some forecasts. Similarly, ServiceNow's stock dropped despite reporting better-than-expected results, fueling concerns that rising AI-related costs could pressure profits for enterprise software companies. The news sparked broader fears that AI was transforming the sector faster than companies could capitalize on it, leading the S&P 500 Software and Services Index to fall.
Domo is down 34.9% since the beginning of the year, and at $5.40 per share, it is trading 70.3% below its 52-week high of $18.20 from September 2025. Investors who bought $1,000 worth of Domo’s shares 5 years ago would now be looking at an investment worth $78.61.
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