London, Feb 4, 2026, 09:17 GMT — Regular session
Sage Group plc (SGE.L) shares dropped 3.9% to 837 pence by mid-morning in London on Wednesday, deepening a steep selloff that’s hit software and data stocks hard this week. (Investing)
The recent decline is significant as investors debate if AI automation might cut into subscription software’s paying users — and the reliable cashflows that underpin valuations.
Traders flagged Anthropic’s rollout of plug-ins for its Claude Cowork agent, designed to automate tasks in legal, sales, marketing, and data analysis. “Sometimes the market just shoots first and asks questions later,” said Mike Archibald, portfolio manager at AGF Investments. On Tuesday in London, Sage and rivals like Experian, London Stock Exchange Group, and Pearson dropped between 6% and 12%, Reuters reported. (Reuters)
Sage, better known for its accounting, payroll, and HR software, pushed back against that narrative in its latest update. On Jan. 27, the company reported a 10% rise in organic revenue—excluding acquisitions and currency effects—bringing it to £674 million. CFO Jacqui Cartin said Sage had “delivered a strong start to FY26” and reiterated full-year guidance. (Sage)
The company also highlighted additional AI capabilities in its product updates. “Decisions need to be made faster and with better information,” said Rob Sinfield, Sage’s SVP for ERP, as the firm unveiled new AI-driven enhancements to Sage X3, its ERP software aimed at mid-sized businesses. (Sage)
Not all broker opinions were bearish. On Monday, Canaccord Genuity bumped Sage up from “hold” to “buy,” lifting its price target to 1,135 pence. The firm called the recent selloff excessive, highlighting a 6% free cash flow yield and suggesting buybacks could tack on another 3-4% annual growth in earnings per share. (London South East)
Sage continues its stock buyback efforts. A recent filing revealed it purchased 1,964,614 shares on Feb. 3, paying a volume-weighted average price of 916.77 pence. The company confirmed these shares will be cancelled, part of its ongoing buyback programme. (Investegate)
The broader London market held steady, with the FTSE 100 gaining roughly 0.5% in early trading. Yet, Sage lagged behind despite the stronger index. (Reuters)
Yet, the swings might not head in a single direction. Nvidia CEO Jensen Huang dismissed the notion that AI will render software tools obsolete as “the most illogical thing in the world,” despite a selloff in software stocks extending into Asia on Wednesday. (Reuters)
Focus shifts to Sage’s annual general meeting on Thursday, Feb. 5, held at its Cobalt Park headquarters in Newcastle upon Tyne. Investors are set to challenge management on AI strategy, pricing policies, and capital returns. (Sage)
The shareholder vote is also crucial for cash returns. Sage has put forward a 14.40 pence final dividend, set to be paid on Feb. 10 if the AGM approves it, to those on the register as of Jan. 9.
Following the AGM, the next key date is May 21, when the first-half interim results are due. This will give management a fresh opportunity to quantify how AI investments and new product launches are driving growth. (Sage)
