Morgan Stanley Sees AI Driving Structural Growth in the Software Industry

Overview

In June 2026, Morgan Stanley held a New York subway tour meeting with management of several AI and infrastructure-related software companies. The survey focused on the impact of AI technology on corporate operations and the strategies companies are implementing in response to this trend. The report notes that Datadog and MongoDB are among the most benefited enterprises during the AI wave, while CoreWeave, UiPath, and Varonis also show strong growth momentum in their respective fields.

Core views

Through in-depth interviews and data analysis, Morgan Stanley draws the following core views: Firstly, in the observational platform sector, Datadog凭借其强大的平台整合能力和技术创新，在AI时代成为重要赢家。公司预计全年收入增长稳健，特别是在AI原生客户方面的快速增长显示出强劲势头。 其次，MongoDB在数据库领域的技术优势使其能够在AI应用开发中占据有利地位。随着企业开始构建AI代理程序，MongoDB的产品组合能够满足日益增长的需求，尤其是在操作数据存储方面。 第三，CoreWeave在GPU基础设施租赁市场表现出色，尽管面临短期成本压力，但长期来看具有较高的盈利潜力。公司计划通过自建数据中心来扩大规模，并利用现有客户的交叉销售机会增加收入。 第四，UiPath在机器人流程自动化(RPA)市场继续保持领先，虽然市场竞争激烈，但公司正在通过改进产品和服务提高市场份额。管理层对未来几个季度的增长持乐观态度。 最后，Varonis在数据安全领域拥有独特的平台优势，随着AI普及带来的安全隐患增多，该公司有望从中获益。尽管短期内仍面临挑战，但SaaS模式转型将有助于改善盈利能力。

Analysis framework

Morgan Stanley adopted an on-site research approach, gathering firsthand information through face-to-face meetings with company executives and combining it with public financial data for comprehensive analysis. They pay special attention to companies' strategic布局、市场需求变化和技术发展趋势, assessing each company's future growth potential and investment value. Additionally, they use various financial metrics such as revenue growth rate, gross margin, free cash flow, etc., to ensure the objectivity and accuracy of conclusions.

Methodology notes

• Industry/sector Analysis FrameworkSupply and Demand Framework

  Supply and Demand Framework

  This framework is used to analyze a company's supply and demand situation, helping to determine its competitive position and development potential. For example, CoreWeave continues to receive stable customer demand despite tight GPU supply, indicating its strong control over the supply chain.

• Valuation MethodDCF Cash Flow Discounting

  DCF Cash Flow Discounting

  This is a commonly used valuation method, predicting future cash flows and discounting them back to present value to calculate enterprise value. For example, when evaluating Datadog, Morgan Stanley uses CY28 year's FCF/share estimated values multiplied by a certain multiple to arrive at the target price.

• Company Fundamentals and Financial FrameworkThree Statement Reconciliation

  Three Statement Reconciliation

  This method analyzes the relationship between balance sheet, income statement, and cash flow statements to comprehensively understand a company's operating condition. For instance, UiPath's significant improvement in GAAP profitability is shown through this approach.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Datadog Inc (DDOG.US)

  Benefiting from growth in AI monitoring demand

  Strengths

  Strong platform integration capability, leading technological innovation

  Weaknesses

  High dependency on cloud migration and AI application development

  Comparison

  Compared to other observatory platform vendors, Datadog has a stronger competitive advantage

  Risks

  Increased competition may affect growth speed

• MongoDB Inc (MDB.O)

  Benefiting from the enterprise AI application build cycle

  Strengths

  Clear database technology advantage, prominent product innovation

  Weaknesses

  Continuous R&D investment needed to maintain technological leadership

  Comparison

  Compared to traditional database vendors, MongoDB is better suited for modern AI applications

  Risks

  Competitive pressure from large cloud players

• CoreWeave (CRWV.O)

  Benefiting from growing demand for GPU infrastructure rentals

  Strengths

  Leader in the GPU infrastructure rental market, solid customer base

  Weaknesses

  High debt level brings some risks

  Comparison

  Compared to other data center operators, CoreWeave is more specialized in GPU rentals

  Risks

  Significant capital expenditure pressure

• UiPath Inc (PATH.N)

  Benefiting from a resurgence in RPA demand

  Strengths

  Leading position in RPA, well-developed product ecosystem

  Weaknesses

  Intense competition, need for continuous innovation

  Comparison

  Compared to other RPA vendors, UiPath has stronger brand influence

  Risks

  Economic fluctuations may impact customer demand

• Varonis Systems Inc (VRNS.O)

  Benefiting from increased data security needs driven by AI

  Strengths

  Unique data security platform, smooth SaaS transformation

  Weaknesses

  Customer conversion progress slower than expected

  Comparison

  Compared to other data security vendors, Varonis has an advantage in cross-environment coverage

  Risks

  Uncertainty in federal government orders

Key data

• Datadog FY26 Second Half GuidanceConservatively handling maximum AI customer spendingExcluding excess consumption, considering only committed expenditures
• MongoDB Atlas GrowthNet new customers addedKey indicators include API call counts and workload expansion
• CoreWeave Q4 Operating Margin TargetLow double digitsShort-term pressure is a timing issue rather than structural problem
• UiPath 1Q27 ARR Growth Rate+12%Significant increase in profitability
• Varonis ConversionARR Guidance Range$50-75 millionClose to internal base case, non-standard beat-and-raise framework

Impact & implications

This survey shows that the development of AI technology is profoundly changing the landscape of the software industry. Companies that can quickly adapt to new technologies and seize market opportunities will gain greater developmental space. This also means investors need to pay more attention to a company's innovative capabilities, market responsiveness, and strategic execution ability to make more accurate investment decisions.

Risks

• Slower growth due to underperformance of AI technology development
• Increased competition squeezing profit margins
• Economic fluctuations impacting IT expenditure budgets
• Regulatory policy changes potentially affecting business operations

What to watch

• Datadog's share of the AI monitoring market
• Market acceptance of MongoDB's new products
• Progress of CoreWeave's self-built data center project
• UiPath's expansion in the public sector market
• Execution effectiveness of Varonis's customer conversion plan