What Happened?

A number of stocks fell in the afternoon session after markets pulled back as a report raised concerns about artificial intelligence demand and profitability. 

Oracle shares lost more than 5% following news of its cloud business generating lighter margins than expected. According to internal documents cited in the report, the gross profit margin for this business was only 14%, a figure much lower than what analysts had expected. This suggested that the high costs of running the advanced chip infrastructure were weighing on profitability. Compounding these worries was the ongoing U.S. government shutdown, in its second week, with no clear resolution in sight from Washington. These updates drove investors away from riskier assets and towards safe havens, a trend highlighted by gold futures hitting a record $4,000 per ounce for the first time.

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:

• Healthcare And Life Sciences Software company Doximity (NYSE: DOCS) fell 3.1%. Is now the time to buy Doximity? Access our full analysis report here, it’s free for active Edge members.
• Vertical Software company Bentley Systems (NASDAQ: BSY) fell 3.5%. Is now the time to buy Bentley Systems? Access our full analysis report here, it’s free for active Edge members.
• Advertising Software company Zeta Global (NYSE: ZETA) fell 3.3%. Is now the time to buy Zeta Global? Access our full analysis report here, it’s free for active Edge members.
• Vertical Software company Guidewire Software (NYSE: GWRE) fell 3.4%. Is now the time to buy Guidewire Software? Access our full analysis report here, it’s free for active Edge members.
• Automation Software company SoundHound AI (NASDAQ: SOUN) fell 3.3%. Is now the time to buy SoundHound AI? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Bentley Systems (BSY)

Bentley Systems’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 5 days ago when the stock gained 5.3% on the news that the company was set to be added to the S&P MidCap 400 index. 

This inclusion, effective before the market opened on Monday, October 6, meant that investment funds tracking the index needed to purchase the company's shares. Such buying activity often leads to increased demand and a higher stock price due to the added visibility. Bentley Systems replaced Western Union in the mid-cap index. Western Union, in turn, moved to the S&P SmallCap 600. The changes in the indexes were prompted by the completed acquisition of Mr. Cooper Group by Rocket Companies.

Bentley Systems is up 17.7% since the beginning of the year, and at $54.73 per share, it is trading close to its 52-week high of $58.72 from July 2025. Investors who bought $1,000 worth of Bentley Systems’s shares 5 years ago would now be looking at an investment worth $1,820.

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