Global technology markets recently experienced a sharp sell-off after the launch of new AI tools by Anthropic, but Sundar Pichai, CEO of Google, believes the reaction from investors has been exaggerated.
Speaking during Google’s earnings call, Pichai addressed concerns triggered by Anthropic’s new Claude Cowork plugins, which many believe could disrupt traditional software companies. He described artificial intelligence primarily as an enabling technology, not something that will immediately replace entire industries. According to him, AI works best when it enhances existing products and services—just as Google has integrated it into platforms like Search and YouTube. Pichai added that companies willing to adopt AI early will likely benefit from the same opportunities.
Nvidia CEO Also Questions the Market Reaction
Pichai’s view is shared by Jensen Huang, CEO of Nvidia, who criticized the sudden market selloff during a recent event hosted by Cisco. Huang described the reaction as “the most illogical thing in the world.”
He argued that AI tools will not eliminate existing software systems but will instead rely on them to function. Using a simple analogy, Huang said there’s no need to reinvent tools when existing ones already work effectively. At Nvidia, he noted, employees are already using AI to automate routine tasks, allowing them to focus more on innovation such as designing advanced chips and computing systems.
The Trigger: Anthropic’s New AI Plugins
The panic began after Anthropic released 11 open-source plugins for its AI assistant, Claude Cowork, designed to help non-technical professionals perform business tasks. These plugins target common enterprise functions such as sales, marketing, finance and customer support.
However, the legal automation plugin created the most concern. It can automatically review contracts, analyze NDAs, check compliance requirements and even prepare legal summaries. Analysts believe such tools could threaten traditional legal software companies.
For example, Thomson Reuters and RELX saw their stocks fall by about 15%, while LegalZoom dropped nearly 20%. The impact spread globally, with Indian IT companies also affected—shares of Infosys and Wipro declined as investors worried about AI disrupting software services.
Growing Concerns About AI’s Capabilities
The fear goes beyond just legal tools. Many people are realizing that modern AI systems can perform a wide range of complex tasks. With simple prompts, these tools can now write software, analyze financial data, manage emails and even control parts of a user’s computer.
Examples circulating online show how non-technical users are building applications using AI without knowing how to code. Even Shopify CEO Tobias Lütke reportedly created software that could interpret his MRI scans using AI tools.
Large companies are already seeing productivity gains. Meta CFO Susan Li recently revealed that AI coding tools have increased engineering output by about 30% year-over-year, while heavy users of such tools have seen productivity improvements of up to 80%.
Anthropic’s Rapid Growth
Anthropic itself is expanding rapidly. Its coding-focused AI tool Claude Code reportedly reached $1 billion in annualized recurring revenue within months of launching. The company is also said to be raising funding that could value it at around $350 billion. Some analysts suggest that enterprises are increasingly choosing Anthropic’s products over competitors like OpenAI.
Debate Over AI’s Impact Continues
While investors remain nervous about the speed of AI disruption, industry leaders like Pichai and Huang believe the panic may fade over time. Their argument is that AI will mainly enhance existing software ecosystems rather than destroy them overnight.
For now, however, Wall Street is still trying to figure out just how dramatically artificial intelligence could reshape the technology landscape.
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