NOW

The company is successfully positioning itself as the essential governance and workflow layer for enterprise AI, with strong adoption metrics for its AI-native products.

Headless. The biggest strategic shift: NOW is openly charging for headless access. Action Fabric opens NOW workflows to third-party front ends via MCP/A2A. That now includes a ChatGPT plugin under the expanded OpenAI partnership and deeper GOOGL Gemini Ente...

AI-native service desks, the labs’ enterprise agents and hyperscaler agent platforms can sit in front of the system of record, and internal builds get easier every model cycle. Even if NOW keeps the data and workflow layer, pricing power moves to whoever ow...

BNP partner checks were broadly positive, with customers and partners highlighting the company's role in governing and automating AI workflows, and one customer citing significant IT help-desk savings.

Control Tower adoption is accelerating sharply, and Armis/security assets plus CMDB strengthen the company's positioning as an enterprise AI orchestration/governance layer.

Partners are hiring aggressively into their practices, and adoption is expanding beyond IT into employee and customer workflows.

NOW: BNP partner checks reinforce AI governance + Control Tower upside; adoption broadening beyond core IT

Q3 appeared to finish ahead of expectations, and the setup for Q4 appears positive.

Cleveland checks indicate Q3 is finishing ahead of expectations, with a positive setup for Q4.

JPMorgan expects 3Q cRPO of ~$13.6B, representing 19.5% year-over-year growth (approximately 20% constant currency), with organic growth around 17.4% but potential for upside.

Stabilization near approximately 19% organic growth would be the key re-rating signal.

Partner checks remain strong, with most businesses growing around 20% and every renewing customer at one Elite partner moving to AI-native SKUs, resulting in a 10–25% spend uplift.

AI ACV already exceeded $1B in 2Q, compared to approximately $600M exiting 2025.

Bernstein states that AI Native SKU take rates remain around 50% at renewal, with over 80% of recent contracts including some AI exposure.

AI Native SKUs are expected to add approximately 60–70bps to Q4 growth and peak at 1.5–2pts through FY28, with over 80% of customers expected on AI Native SKUs by YE28.

Bernstein raises FY27/28 estimates by 1–2%+ and increases the price target to $266.

NOW: JPM sees low-20s cRPO, AI SKU upgrades driving 10–25% renewal uplift

JPMorgan projects Q3 cRPO of ~$13.6B, representing a 19.5% year-over-year increase, with every renewing customer at one Elite partner moving to AI-native SKUs at a ~10-25% spend uplift.

Bernstein expects AI Native SKUs to add 60-70bps to Q4 growth.

NOW +2.9% on two positive previews: JPM sees 3Q cRPO of ~$13.6B, +19.5% y/y, with every renewing customer at one Elite partner moving to AI-native SKUs at a ~10-25% spend uplift (AI ACV topped $1B in 2Q vs. ~$600M exiting 2025), and Bernstein has the AI Nat...

Piper's partner survey shows strong net performance for NOW, indicating its continued strength in the app software market.

Citi raised its price target, citing more constructive partner/CIO checks, improving AI SKU interest, better renewal commentary, and strong cyber demand.

Citi sees potential upside to Q3 constant currency current Remaining Performance Obligations (cRPO) and slight organic acceleration, despite likely conservative Q4 guidance.

MSFT remains the clear leader at +77% net performance and 82% prepackaged-AI adoption, followed by NOW +55%; HUBS improved to +36%, while FIG showed more bifurcation/AI displacement risk. Anthropic remains the most strategic AI vendor ahead of MSFT/OpenAI,...

The stock benefited from a rotation into app software, which is perceived as an 'AI-loser bounce'.

Piper's 3Q partner survey showed a significant reduction in AI projects causing deal delays, with the company ranking second only to Microsoft.

The company explicitly stated it has no interest in acquiring Decagon, alleviating market concerns.

Evercore ISI believes that ServiceNow's F3Q cRPO (current Remaining Performance Obligations) of approximately 21–21.5% constant currency would be sufficient to support approximately 19% organic growth and de-risk FY27 expectations, with 21.5–22% further strengthening the stabilization thesis.

Partner checks indicate steady demand, improving new logos, seat expansion, and Prime adoption, with Now Assist/AI Control Tower and Armis/Veza security pull-through identified as key CY27 upside drivers.

Oppenheimer's checks support a slight Q3 upside, with Security/ITOM performing well and cRPO facing an unusually low seasonal bar, and AI traction is improving, potentially leading to a 2026 AI ACV guidance raise.

A partner hit Q3 plan and expects Q4 to represent 35–40% of annual bookings, with every renewing customer migrating to new SKUs at 10–25% higher spend without seat losses.

Armis/Veza/AI Control Tower is already winning security deals, and the partner expects better growth in 2027 than in 2026.

The company is expected to have a solid Q3 with stable federal trends and modest upside to FY26 subscription guidance, supporting stable organic growth into FY27.

Federal business remains stable despite budget pressure, with core products being highly defensible and shelfware significantly reduced.

Early AI adoption, with outcome-based deployments and expansion from initial use cases, is expected to contribute more meaningfully in 2027.

Partner checks show healthy growth, with some partners at 20%+.

Renewals are exceptionally strong, and deal sizes are typically rising 10–20%.

Partners view demand as delayed rather than lost despite longer sales cycles due to AI ROI scrutiny.

Pricing remains healthy, including ~12–15%+ increases at some large enterprises.

Platform consolidation and ITOM/CMDB remain key growth drivers.

NOW: JPM partner checks show healthy growth + bigger renewals, but AI ROI scrutiny is delaying some deals

JPM says across 10 partner/customer conversations, NOW growth remains mostly double-digit with some partners at 20%+, while renewals are exceptionally strong and deal sizes are typically rising 10–20%.

Management framed agentic identity as potentially one of the largest future categories in cybersecurity, with Okta for AI Agents able to sell independently of a customer’s existing workforce identity provider, opening the door to Microsoft Entra environment...

BTIG raised its price target to $170, saying AI monetization is broadening while the Q4 cRPO step-down is largely mechanical after meetings with management.

The expected ~50bps Q4 cRPO deceleration mainly reflects lapping the Moveworks acquisition benefit rather than weakening demand, with easier federal comps and Artemis still supporting the quarter.

BTIG says Now Assist monetization is increasingly coming through SKU upgrades plus usage-based economics, with customers getting initial AI capacity and paying more as consumption scales.

BTIG also sees gross-margin synergies from recent deals and limited need for another large acquisition, reiterating a Buy rating.

The stock showed significant strength, categorized as an 'AI Loser' in the application software sector.

Cleveland was positive, noting that Q1 appeared to finish ahead with some pull-forward benefit.

The company remains well-positioned in the application software space due to its workflow breadth and AI exposure.

Bernstein’s mid-year CIO survey still points to strong 2026 IT budget growth, but U.S. respondents cut second-half expectations while European CIOs turned more constructive. Cybersecurity, GenAI applications and platform software remain the top priorities,...

The company is identified as the preferred large-cap SaaS name in Barclays' investor survey.

Accelerating revenue growth is seen as the clearest catalyst to improve software sentiment.

Modestly increased positioning suggests investors remain cautious but may have already reduced underweights, creating a more favorable stock-picking setup.

Software: Barclays Survey Shows NOW and SNOW as Favorites, With Growth Reacceleration the Key Catalyst

Goldman sees a more attractive setup than last quarter, with the approximately 17.25% organic cRPO guide embedding extra conservatism post-1Q Middle East slippage.

Goldman models 20.5-21.5% as a reasonable upside scenario, representing approximately a 150 basis point beat, in line with history.

The biggest re-rating driver is proving enterprise AI-stack relevance via the Knowledge ITSM use case and Moveworks/Veza/Armis cross-sell.

Recent mergers and acquisitions are defended as closing gaps from strength.

The 2026 guide implies just 200 basis points of core deceleration, compared to 300 basis points in 2023-25.

Goldman reiterated a Buy rating and a $145 price target.

Some bifurcation in app sw: TEAM/WDAY/NOW +1-2% while ADBE -75bps and SAP -1.3%.

The recent selloff has created an attractive valuation opportunity, with the stock trading at approximately 5.9x EV/NTM recurring revenue despite expectations for continued double-digit organic growth.

Improving U.S. federal government spending should help remove a key overhang after a sluggish year, contributing to an attractive risk/reward at current levels.

A solid F2Q performance, particularly CRPO growth of approximately 20-20.5% constant currency, would reinforce the stabilization narrative and alleviate concerns about organic deceleration.

In the U.S., Software +1% outperforming Semis -1% early with the former helped by a few upgrades from Difucci at Guggenheim (CRM, NOW, CHKP). Memory following Korea memory names lower (SNDK -5%, MU -3%). HDDs and Semicap also weak to start the new month.

Benchmark reiterated Buy and raised its price target to $130, arguing NOW remains one of the cleaner large-cap software stories as AI, data, security, and workflow automation expand its growth opportunity.

Management reaffirmed its path to roughly $30-32B of subscription revenue by 2030, supported by agentic AI workflows, AI upgrades, and expansion across security, CRM, and operational technology.

The firm believes investors are overly focused on ITSM/ITOM disruption risk, arguing AI is more likely to increase software and workflow spending than displace ServiceNow’s core platform.

With revenue growth and margins expected to improve, Benchmark sees a path toward Rule-of-60 economics that remains underappreciated by the market.

Enterprise AI adoption is shifting from pilots to production, driving workflow automation demand and new monetization opportunities.

The company's model-agnostic architecture allows customers to leverage multiple frontier models while keeping workflows, data, and governance within the platform.

Management believes AI pricing concerns are overdone and reiterated confidence in the company's $30B revenue target for 2030.

Strength in the software sector is extending to the company, indicating positive momentum.

It started with Cyber and DDOG ( and some names like U) at first as both hit new highs while the rest of the space lagged, then ORCL got the AI bid, moved onto to MDB/SNOW getting some love (which is now in full force after SNOW last night and MDB this even...

BofA reinstated coverage with a Buy rating and a $130 price target, arguing that ServiceNow is uniquely positioned to benefit from the rise of agentic AI due to its deeply embedded role governing enterprise workflows.

The firm believes autonomous AI deployments will materially increase the need for orchestration, permissions, approvals, governance, and auditability, directly aligning with ServiceNow’s core platform strengths.

BofA highlights strong growth/FCF generation, sustained cRPO strength, and emerging AI monetization opportunities as reasons the stock deserves a premium multiple relative to peers.

The strength in ServiceNow was attributed to a positive BofA initiation and general short covering/factor rotation, rather than specific news.

Lots of questions around some of the big moves here, but not a lot of stock specific answers and more just short covering/factor rotation on the semis down day. Some of the big app sw laggards caught a bid with NOW +9%, MDNY +8.5%. Never got a great answer...

One could make a strong argument that DDOG & FTNT (or cyber in general) is helped by AI demand, while the case is hard to make for something like WDAY or NOW or FIG. It’s still unclear how that latter group would respond to strong numbers.

ServiceNow outlined a path to over $30 billion in subscription revenue by FY30, with AI becoming a material driver, supported by over $1 billion in AI ACV growing 40% year-over-year and strong Now Assist traction.

The company highlights robust margins, targeting over 32% EBIT, despite AI costs, with inference representing only 10% of the cost-to-serve, indicating confidence in the long-term model transition.

Service Collection surpassed $1B ARR, grew >30% y/y, and mgmt called this TEAM’s largest-ever quarter for competitive displacements from a major ITSM provider (neg read-through to NOW)

Benchmark reiterated Buy with a $125 price target, identifying the company as a top value pick with a favorable setup for beats across revenue, margins, and FCF into 1Q26 earnings.

This is supported by strong execution and improving enterprise demand trends.

The firm highlights increasing momentum in AI-driven workflows and expects CEO messaging to emphasize operationalizing AI across key verticals, driving approximately 20%+ growth and over 30% FCF margins.

Benchmark adds that valuation offers attractive risk/reward with potential approximately 20-25% upside and catalysts from the upcoming Knowledge Conference and continued AI adoption.

JPM's partner checks indicate excellent Q1 demand with upside to expectations and strong vertical performance, with limited macro/geopolitical impacts.

AI adoption is expanding beyond contact centers into back-office automation, with AI licensing viewed as a strategic inflection that embeds capabilities across the platform and shifts pricing toward consumption over time.

BTIG expects a solid Q1 with strong cRPO growth and a likely beat, supported by stable enterprise demand and improving channel checks.

AI is in early production but shows strong interest, and new packaging/pricing models are expected to improve retention, expand wallet share, and increase monetization.

The hybrid subscription + consumption approach provides budget predictability while positioning for longer-term consumption upside, with incremental contributions from acquisitions supporting FY26 growth.

NOW: JPM Sees Strong Q1 Checks + Broadening AI Adoption; Reiterates Overweight

JPM says NOW partner checks point to “excellent” Q1 demand with upside to expectations and strong vertical performance (banking, financials, manufacturing), while macro/geopolitical impacts remain limited; the firm highlights AI adoption expanding beyond co...

The analyst heard positive feedback from Clev, suggesting that Q1 performance appeared to finish slightly ahead of expectations.

ORCL +4% leading large cap higher but NOW also +4% on some positive 3p checks while MSFT +~2% again.

Cleveland reported that the company likely finished the quarter ahead of plan.

Citi continues to prefer the company within applications due to stronger organic growth, AI cycles, and SMB/eCommerce exposure.

Citi continues to prefer data/infra and hyperscalers (MDB, SNOW, PLTR, MSFT) and within apps still likes SHOP, NOW, HUBS, BRZE, KVYO for stronger organic growth, AI cycles, and SMB/eCommerce exposure.

BTIG sees a credible path to 17%+ organic subscription growth in FY27, driven by Now Assist Pack consumption and better-than-expected M&A contribution.

Pyramid Analytics is expected to add over 120bps to Q1 cRPO and approximately $120M to FY26 subscription revenue.

Morgan Stanley remains Overweight, arguing that the Armis acquisition is strategically about closing the physical asset visibility gap and extending end-to-end workflows into OT, rather than merely buying growth.

The firm estimates Armis could add approximately 280-320 basis points to constant currency cRPO growth and 200-260 basis points to constant currency subscription revenue growth from 4Q26 through 3Q27.

Morgan Stanley sees an attractive entry point, noting that a re-acceleration in top-line metrics, likely in the second half as consumption-oriented pricing takes hold, is needed to rebuild investor confidence in the AI monetization ramp.

BNP Paribas upgraded ServiceNow to Outperform.

Cleveland analysts had slightly positive checks on the company, suggesting some underlying strength despite the stock's overall weakness.

Needham reported that customers are increasing purchases of Now Assist credits as efficiencies materialize, indicating that GenAI is being adopted to drive operating efficiency and ROI within existing workflows.

The company was added to Wedbush's AI 30 List, along with CRM.

NOW +3% as Needham says customers are already buying more Now Assist credits as efficiencies materialize, noting GenAI is being adopted as a lever to drive operating efficiency and ROI—embedded into existing workflows— rather than as a standalone tool, supp...

Analyst reports indicate a positive outlook, with Q4 finishing ahead due to large deals and PRO+ upsells.

Citi initiated a positive 30-day catalyst watch on ServiceNow, expecting a strong upcoming quarter driven by a modest year-end budget flush and solid deal activity.

Early checks indicate a robust close to the quarter and strengthening pipelines into FY26, while shares trade at trough multiples near FY16 levels, suggesting the Street underestimates earnings growth potential.

The analyst reiterates expectations for 20–25% earnings growth alongside approximately 20% revenue growth and margin expansion.

A strong 4Q print and ramping AI consumption revenue in 2026 could mark a positive inflection for the stock.

Goldman Sachs rates ServiceNow as a Buy, positioning it as a key player in the agent orchestration layer within its AI-maturity framework, which is expected to accrue the greatest value.

Arete upgraded ServiceNow to Buy from Neutral.

The company possesses strong fundamentals and is a high-quality business.

MDB +1.2% as BMO initiated at with AI Buy - tailwinds driving upside to $280. Fast moneylpods are long here now as the set -up is good into the print and talking to analysts, hearing there is more interest from HFs/LOs kicking the tires on this one MDB Eik...

Stronger partner pipeline and easing macro headwinds