Current sentiment is a white-knuckle environment for tech, but demand in Taiwan for semiconductors and components is robust, which is bullish for hyperscalers.

The backdrop is nervous, but understanding the trends is important because this will pass. When it passes, tech stocks are where you want to be positioned, especially during sell-offs.

Current negative sentiment toward software is the worst in over a decade and represents a massively disconnected narrative from reality.

Investors are focused only on semis/hardware and avoiding software, but use cases from companies like Microsoft, Oracle, Salesforce, and ServiceNow show strong potential. Software stocks are on massive sale relative to their future in the AI revolution.

Some pure-play companies could be at risk from AI models like Anthropic, but established players with strong install bases and trench stacks are well-positioned.

Companies like Salesforce, ServiceNow, Oracle, CrowdStrike, and Palo Alto are building real use cases with customers, which shows their resilience and growth potential.

Microsoft trades at multiples on free cash flow and earnings not seen in 8-10 years and is the most disconnected stock in tech.

Free cash flow growth will be mid-to-high teens or higher over next 2-3 years. If 10% of their base upgrades to AI, it's a $500-550 stock; base case suggests $650. Debt load at 3.3% is manageable.

Cybersecurity budgets will increase from 5% to 10% of IT spend over next 2-3 years due to expanded attack surface from AI agents.

This makes cybersecurity more strategic and not displaceable by AI models. Companies like CrowdStrike, Palo Alto, and Checkpoint will have massively bigger opportunities. The AI 'black cloud' over the sector is misplaced.