Europe has SAP from germany. That's it. You might say Spotify in Sweden or ARM from UK, but microsoft just laid off more than both of those have combined. Not the same scale.
Consider as well, it's certainly not talent, there's tons of highly skilled software people in the EU.
The literal holdup is converting that talent to business. Why is the EU so hostile to business? Extreme regulation, high taxes, high labour laws, and anti innovation/entrepreneurship is the problem.
The EU isnt even in the tech war because of their own choice of government. The EU has made their bed and must now sleep in it because it will take a long time to fix these problems through multiple elections.