Software companies heavily in debt are seeing their loan prices fall as investors worry about AI advancements rendering many products obsolete. The euphoria in credit markets contrasts with growing fears about the sustainability of these companies' revenue streams.

The article discusses how AI is disrupting software revenue, affecting the debt markets tied to software companies. With significant leverage in both software and infrastructure, any downturn in expectations could severely impact these investments, as evidenced by recent drops in stock prices and writedowns in private debt funds.