Fears of artificial intelligence disruption have hammered Canada’s largest technology stocks, with the five biggest laggards in the S&P/TSX 60 Index all sharing a common thread: investor panic over chatbots replacing traditional software. Shopify, Constellation Software, Open Text, Thomson Reuters, and CGI Group have dropped an average of 24 percent year-to-date as AI anxiety grips the market.

Shopify has fallen roughly 22 percent in 2026 despite posting strong fourth-quarter results with revenue up 30 percent to $378.4 billion. The concern centers on whether AI chatbots could bypass Shopify’s platform entirely by connecting consumers directly to merchants. If conversational commerce takes hold, Shopify’s role as the middleman faces existential risk. The company does not pay a dividend but authorized up to $2 billion in share buybacks to offset the selloff.

Constellation Software has been hit hardest, plunging over 50 percent from its 52-week high. The stock closed Friday at $2,486 after peaking above $4,900 last year. Founder Mark Leonard’s departure in late 2025 compounded concerns that AI would disrupt the vertical market software consolidation strategy that made Constellation a generational winner. RBC Capital Markets recently suggested the pullback is overdone, but the stock remains under pressure.

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The paradox is that both companies are investing heavily in AI themselves. Shopify has launched early agentic AI capabilities to strengthen its competitive position, while Constellation could benefit from a growing pool of AI-enabled acquisition targets. Open Text rolled out its Aviator AI platform for enterprise data management, yet the stock continues to decline on disruption fears.

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Analysts at BMO Capital Markets remain constructive on Canadian tech for 2026, naming Shopify and Constellation as top picks despite near-term pain. The firm expects AI fears to fade as investors recognize that adoption creates opportunities, not just threats. For now, Canadian tech remains in a correction. Investors willing to stomach volatility may find value, but momentum remains firmly negative until sentiment shifts.