Mistral AI founder Arthur Mensch during the “Nvidia GTC” conference at the 2025 VivaTech conference on Wednesday, June 11, 2025 in Paris, France.
Nathan Lane | Bloomberg | Getty Images
NEW DELHI — Mistral AI’s CEO told CNBC on Wednesday that more than 50% of a company’s current software could be replaced by AI, potentially further heightening investor concerns about software stocks.
Mistral AI CEO Arthur Mensch’s comments come after major software names sold off, in part due to Anthropic’s Cowork product, as investors grow increasingly concerned that AI can do more than what enterprise software currently does.
Investors are concerned that AI will erode so-called software-as-a-service (SaaS) business models. of iShares Enhanced Technology Software Sector ETFwhich counts names like Microsoft and Salesforce among its top holdings, has fallen more than 20% this year. Major software stocks such as Tata Consultancy Services and Infosys also fell in India.
“I would say more than half of what IT departments are buying as SaaS today will be moving to AI,” Mensch told CNBC at the India Accelerates event on the sidelines of the AI Impact Summit in New Delhi, India.
“AI allows us to develop software at the speed of light,” Mensch added.
Mistral’s CEO said that as long as companies “have the right infrastructure in place,” they can connect data to AI systems to create applications that perform specific parts of their jobs.
“Then we actually looked at it with our customers…in a few days, they can create completely custom applications to run workflows, to run procurement workflows, to run supply chain workflows, in a way that five years ago we would have actually said we needed a vertical SaaS.”
Mensch said there is a “re-platforming” happening where companies are looking to leverage AI more instead of their current SaaS.
“Replatforming is a big opportunity for us because we now have over 100 enterprise customers coming to us with the intention of changing and replatforming their IT systems and getting rid of things they bought 20 years ago, so things they bought 20 years ago are starting to get a little more expensive,” Mensch said.
“They see AI as a way to restructure their platforms to be more efficient and less costly.”
But Mensch said the software, which focuses on systems of record, “will not change.” This type of software is responsible for data within an organization and often works in conjunction with AI.
Rubrik CEO Bipul Sinha shares Mensch’s views. In an interview with CNBC on Wednesday, Sinha said “workflow software” could be “hugely disrupted by AI.” However, systems of record and data infrastructure software that enable AI “will be a plus.”
Mistral expansion in India
Mensch also told CNBC that the company plans to open its first office in India this year as it looks to expand into a market where global tech giants are all looking to grab a piece of the market.
Mistral is currently working with international companies based in India, but is also “cultivating” potential India-based customers in both the public and private sectors.
While Mistral is building data centers in Europe, Mensch said the approach will be different in India and will partner with companies that already have physical infrastructure in India.
The Indian government is encouraging AI companies to create models that can be run locally using data stored in the country. India also has a variety of languages, such as Hindi and Punjabi, which Mistral said a large-scale language model could accommodate.
“This is going to be very important for the Indian consumer market in the future,” Mensch said.
