Mistral AI CEO: Over 50% of Enterprise Software Could Be Replaced by AI

Mistral AI CEO: Over 50% of Enterprise Software Could Be Replaced by AI

Arthur Mensch, founder and CEO of Mistral AI, made a significant prediction at the AI Impact Summit in New Delhi this week: more than half of what enterprises currently spend on software could shift to AI solutions within the coming years.

The "Replatforming" Trend

In an interview with CNBC, Mensch stated that "more than half of what's currently being bought by IT in terms of SaaS is going to shift to AI." He described the current moment as a "replatforming" phase where businesses are looking to replace legacy systems with AI-powered alternatives.

"AI is making us able to develop software at the speed of light," Mensch added. He noted that with the right infrastructure in place, enterprises can connect their data to AI systems and create fully custom applications in a matter of days—applications that previously would have required years of development or vertical SaaS solutions.

What Survives: Systems of Record

Not all enterprise software faces disruption. Mensch emphasized that "software focused on systems of records are not going to change." This type of software manages core organizational data and often works in tandem with AI rather than being replaced by it.

Bipul Sinha, CEO of Rubrik, echoed similar views, telling CNBC that "workflow software" could be "significantly disrupted by AI," while data infrastructure software that enables AI would be "a positive."

Market Impact

The prediction comes amid a notable sell-off in software stocks. The iShares Expanded Tech-Software Sector ETF (IGV), which includes Microsoft and Salesforce among its top holdings, is down more than 20% this year. In India, major software stocks like Tata Consultancy Services and Infosys have also declined.

Mistral AI, which recently raised funding at a $60 billion valuation, is seeing enterprise customers approach them with interest in replatforming their IT systems. The company reports over 100 enterprise customers exploring the possibility of replacing older, expensive systems with AI solutions.

Mistral's India Expansion

Mensch announced that Mistral plans to open its first Indian office this year, entering a market where global tech giants are aggressively expanding. The company will partner with existing infrastructure providers rather than building its own data centers in India, different from its European approach.

The Indian government's push for AI models that can run locally with domestically stored data aligns with Mistral's multilingual capabilities, which support languages including Hindi and Punjabi.

What This Means for Businesses

1. Workflow and task-based software is most vulnerable to AI disruption

2. Systems of record (databases, ERP core) will remain relevant

3. Custom AI applications can now be built in days, not years

4. Infrastructure investment is a prerequisite for successful AI adoption

The transition will be gradual, but the direction is clear: AI is increasingly positioned not just as a tool but as the primary platform for enterprise task automation.

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Sources: CNBC