The Morning Download: Understanding AI’s Actual Impact on Enterprise Software

Good morning. AI is influencing the way that big companies invest in software, but it’s far more subtle than the doomsday scenario implied by the selloff in the public markets. The WSJ Leadership Institute’s Belle Lin spoke with senior executives at FedEx and other large organizations to assess how the AI-software dynamic is actually unfolding. 

Despite the AI-driven software stock meltdown, America’s largest corporations aren’t ditching their core business software just yet. Instead, they’re using the moment to squeeze better deals from vendors and “vibe-code” smaller apps and software customizations.

Furthermore, their efforts may provide a preview into “what comes next, when AI agents drive more workflows on top of that software.”

The key insight for company leaders is that they need an ever-evolving mindset that looks beyond software to the dynamic between software, AI and their organizations and customers.

Read on for more insights from her story.

Companies aren’t looking to completely replace their business software, for several reasons. For one, it’s not easy to do, and in some cases, it’s simply not worth their time, Belle writes.

Vishal Talwar, chief digital and information officer of FedEx, told her that the shipping giant is “not looking at this point for [software] to leave our enterprise.”

Yet he sees the uncertainty over software’s future, and the advent of AI agents, as a chance to re-evaluate how it is priced. “We’re contemplating all of these shifts,” Talwar said. “And having proactive conversations with each of our partners to see how they plan to keep up.”

Mike Kempe, chief information officer of audit and consulting firm Grant Thornton, told Belle that business software like enterprise resource planning systems are equipped to handle the complexities of regulatory requirements, multiple geographies and languages—making it “very challenging to build this using AI today.”

Once companies build their own software, they have to keep it updated and dedicate engineering resources toward the effort. “I’d much rather spend our internal dollars and effort building something that is truly cutting-edge and helps us grow,” he said.

Some business technology leaders, for now, say they’re vibe-coding smaller apps and customizations on their existing software. That work offers a glimpse into what the future of business software could hold—one in which AI agents replace much of the software’s functionality.

• Raj Sharma, a global managing partner for growth and innovation at Ernst & Young, said the audit, consulting and tax firm doesn’t plan to do away with its longstanding ERP software from SAP, but it is vibe-coding and using AI agents to build its own customizations on top of it.
• Thimaya Subaiya, executive vice president of operations at Cisco Systems, said the networking-equipment maker replaced a presentation software tool with its own AI agent, saving the company nearly $5 million annually in license costs.

How is the interplay of software and AI taking shape within your company, and what does that mean for the future of your organization, as well as its relationships with tech suppliers and customers? Let us know.

CEOs have been AI's loudest cheerleaders. Now one is making it personal. Mark Zuckerberg is building a personal AI agent designed to help him run Meta faster, bypassing organizational layers to get information directly, the Journal reports.

The move reflects a companywide push to integrate AI into daily work and stay competitive with leaner, AI-native startups. Meta employees are already using internal tools like "My Claw" and "Second Brain" to automate tasks and communicate on their behalf and AI use is now factored into performance reviews.

Some find the shift energizing; others fear it signals future layoffs. The stakes are high: Meta has cycled through major layoffs before, and employees know it.

Message received: Young workers are reshaping their career plans around AI anxiety. Young grads have reason to be concerned: A Stanford University research found employment among AI-exposed workers ages 22 to 25 fell 16% from late 2022 to 2025. The WSJ reports on how some young workers are taking a proactive approach: A 28-year-old insurance worker is retraining as a firefighter; a computer science student dropped out for electrician trade school. Overall, vocational college enrollment has jumped nearly 20% since 2020.

OpenAI to double headcount. The FT reports that the AI company aims this year to grow to about 8,000 employees from its current workforce of 4,500 today. The WSJ reported earlier that OpenAI is under growing pressure from rival Anthropic, which has become the dominant AI provider for businesses. Earlier this month Fidji Simo, OpenAI’s CEO of applications, called upon employees to  deprioritize side projects and refocus on coding and business users.

The autonomous vehicle hype cycle is back, says the Journal’s Tim Higgins. Uber has struck partnerships with Amazon’s Zoox and Motional and plans to invest up to  $1.25 billion in EV maker Rivian for future robotaxis. Meanwhile Alphabet tied CEO Sundar Pichai's compensation to Waymo's valuation for the first time. Even Silicon Valley vehicle OGs, Travis Kalanick, Uber’s ousted founder, and Anthony Levandowski, of the Google car project, have resurfaced. 

Tesla and SpaceX plan chip factory. The Austin, Texas facility will produce chips for Tesla vehicles, Optimus humanoid robots, and space-based AI computing via SpaceX satellites, Elon Musk said Saturday. Morgan Stanley analysts estimate the effort could cost over $20 billion across multiple years — a scale they called "Herculean" even for Musk.

Activist Elliott builds multibillion-dollar stake in Synopsys. The company’s software and services are used by customers including Intel, Alphabet and Tesla to design electronic components for modern chips and ensure their hardware will work as intended. Synopsys has recently lagged behind both the broader semiconductor index and Cadence Design Systems, its closest rival, the Journal reports.

The rise of AI search is forcing companies to rethink how they get noticed online. While traditional SEO fundamentals still matter, AI systems favor different signals, drawing heavily on customer reviews and comments, found on sites like Reddit, G2 and Quora, says Andrew Blackman, writing in the WSJ. Sponsored content is increasingly cited without disclosure, creating new influence opportunities for marketers, even as it can muddies the waters for users.

President Trump said the U.S. military will postpone further strikes on Iranian power plants and energy infrastructure for five days following “productive” talks between Washington and Tehran. (WSJ)

New York City’s LaGuardia Airport was closed Monday after a passenger plane collided with an emergency vehicle on the runway, killing two pilots, authorities said. (WSJ)

Immigration and Customs Enforcement officers will begin trying to ease bottlenecks at airports on Monday, as the Trump administration scrambles to develop a plan to end hourslong security lines amid a partial government shutdown. (WSJ)

The average gallon of diesel crossed $5.20 nationwide on Saturday, up around 40% from a month ago, according to the AAA. Eight of the 10 states where diesel