ServiceNow Raises Outlook as AI Demand Fuels Subscription Growth

ServiceNow is a leading provider of cloud software for IT service management and enterprise workflow automation, with subscriptions generating the bulk of sales. Investors have questioned whether increasingly capable generative-AI agents could displace traditional SaaS applications. ServiceNow has instead sought to make AI a growth engine through Now Assist and AI Control Tower, while adding enterprise-assistant technology through its $2.85 billion Moveworks deal, completed on Dec. 15, 2025. The results offer a key test of whether incumbent software vendors can monetize AI rather than be disrupted by it.

ServiceNow on July 22 reported revenue of $3.987 billion for the quarter ended June 30, 2026, up 24% and above analysts’ $3.93 billion estimate. Adjusted earnings were $0.90 a share versus $0.86 expected. Subscription revenue climbed 24.5% to $3.877 billion, while AI annual contract value exceeded $1 billion for the first time and agentic deployments rose ninefold in nine months. The Santa Clara, California-based company raised its 2026 subscription-revenue forecast to $15.76 billion-$15.78 billion from $15.735 billion-$15.775 billion. Shares gained more than 5% after hours.