N-able shares sank after the company cut its full-year outlook, as artificial intelligence threatens to upend software demand.

The stock slid 21% to $3.94 in premarket trading Monday. Through the prior close, shares were down 32% this year.

The software company said it now expects annual recurring revenue of $562 million to $565 million for the full-year, down from its previous guidance of $581 million to $586 million.

It also lowered its outlook for annual sales to $539 million to $542 million, from $554 million to $559 million.

Chief Executive John Pagliuca said AI is reshaping the security landscape. The report comes as investors have been worried that AI will replace software-as-a-service and wreak havoc on demand for software companies.

N-able is making changes to better capture changing demand trends related to AI, Pagliuca said. The company hired a chief revenue officer and is making organizational changes to hone in on top priorities.

Revenue rose 6% to $138.2 million in the second quarter, coming in just ahead of the $138.1 million that analysts projected. Annual recurring revenue was $544.5 million, below Wall Street's estimate of $557.6 million.

N-able swung to a second-quarter profit of $1.76 million, or a penny a share, from a loss of $4.63 million, or 2 cents a share, in the prior-year period.

For the current third quarter, N-able expects revenue to be $134.5 million to $135.5 million, which would be lower than the $$141.9 million that analysts are forecasting.