What Happened?
A number of stocks jumped in the afternoon session after a two-day wave of AI conviction, sparked by Snowflake's best single-session day on record and extended by Dell's blowout earnings continued to weaken the narrative that weighed on the software sector.
Snowflake's Q1 results sent the stock up 36% on May 28, its strongest single-day gain since its 2020 IPO, showing that AI is accelerating demand for enterprise data platforms rather than cannibalizing them. Then Dell's Q1 report, published after the bell on May 28, confirmed the physical infrastructure layer is expanding at a scale most analysts had not modelled: $43.8 billion in revenue, up 88% year-over-year, AI server revenue of $16.1 billion up 757%, and a record AI backlog of $51.3 billion.
The combined read-through was hard to ignore: enterprises are deploying AI at scale, and they need both the software layer and the hardware stack to do it. A supportive macro backdrop provided additional lift. The 10-year Treasury yield fell to 4.45% on reports of a US-Iran truce extension, reducing the discount rate on long-duration growth stocks.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Endpoint Security company CrowdStrike (NASDAQ: CRWD) jumped 8.3%. Is now the time to buy CrowdStrike? Access our full analysis report here, it’s free.
- Network Security company Palo Alto Networks (NASDAQ: PANW) jumped 8.3%. Is now the time to buy Palo Alto Networks? Access our full analysis report here, it’s free.
Zooming In On CrowdStrike (CRWD)
CrowdStrike’s shares are quite volatile and have had 15 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 1 day ago when the stock gained 4.2% after Snowflake's impressive Q1 results provided clearer evidence that the "SaaSpocalypse", a rolling selloff that had erased approximately $2 trillion from software market values since late 2025 on fears that AI would make subscription software obsolete, had been overstated for platforms sitting at the centre of AI workflows.
The impressive SNOW earnings report supported the growing optimism on Wall Street: with AI accounts on Snowflake jumping from 9,100 to 13,600 in a single quarter and the US-Iran conflict intensifying the cyber threat environment, Morgan Stanley noted in its pre-earnings note during the week that security budgets are not the line item CFOs are cutting, and CrowdStrike is the direct beneficiary of that reality.
Adding to the good news, CrowdStrike announced a collaboration with insurers Coalition, Liberty Mutual and Lockton to help organisations quantify and mitigate financial exposure from frontier AI cyber risks, a signal that the Falcon platform is increasingly being embedded in how enterprises underwrite their AI deployments, not just secure them. The analyst community had been moving in one direction: Benchmark and Wedbush both raised price targets to $700 on May 27, and BTIG raised to $764 on May 26.
CrowdStrike is up 60.8% since the beginning of the year, and at $729.23 per share, it has set a new 52-week high. Investors who bought $1,000 worth of CrowdStrike’s shares 5 years ago would now be looking at an investment worth $3,284.
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