ServiceNow CFO emphasizes the importance of AI in delivering tangible results.
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 02 2025
0mins
Should l Buy NOW?
Source: SeekingAlpha
AI Impact on Enterprises: ServiceNow's CFO, Gina Mastantuono, emphasizes that AI is driving significant efficiency and automation improvements for enterprises, with the company generating $355M from internal AI initiatives and aiming for $1B in AI-related revenue by 2026.
Survey Insights: A survey of IT leaders reveals that 76% are expanding AI use cases, primarily to increase operational efficiency, with 79% reporting efficiency gains from their AI initiatives.
Enterprise vs. Consumer AI: Mastantuono highlights the differences between enterprise and consumer AI, noting that enterprise AI requires higher security and governance, and ServiceNow's unique combination of AI, data, and workflow positions it well in the market.
Market Performance: Despite strong revenue growth and operating margins, ServiceNow's share value has remained static compared to other tech sectors, as investor interest has shifted towards hardware providers rather than software companies utilizing AI.
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Analyst Views on NOW
Wall Street analysts forecast NOW stock price to rise
32 Analyst Rating
30 Buy
2 Hold
0 Sell
Strong Buy
Current: 100.580
Low
172.00
Averages
222.81
High
263.00
Current: 100.580
Low
172.00
Averages
222.81
High
263.00
About NOW
ServiceNow, Inc. provides an artificial intelligence (AI) platform for business transformation. The Company’s AI platform connects people, processes, data, and devices to increase productivity and maximize business outcomes. Its intelligent platform, the Now Platform, is a cloud-based solution that helps enterprises and organizations across public and private sectors digitize workflows. The workflow applications built on the Now Platform are organized into four primary areas: Technology, CRM and Industry, Core Business and Creator. Its products include IT Service Management, IT Operations Management, HR Service Delivery, ServiceNow AI Agents, AI Experience, Build Agent, ServiceNow AI Control Tower, AI Agent Fabric, RaptorDB, Workflow Data Fabric, Workplace Service Delivery, ServiceNow Platform Encryption, Telecommunications Service Operations Management, and others. The Company also offers identity security, helping organizations secure access across the enterprise.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Acquisition Strategy: The company recently acquired Moveworks for $2.85 billion and Armis for $7.75 billion, which, despite concerns over the high costs, positions ServiceNow to enhance its cybersecurity and AI service offerings significantly.
- AI Solutions Growth: ServiceNow's Now Assist AI solution suite has reached an annual contract value of $600 million, with expectations to exceed $1 billion this year, indicating robust growth and demand for enterprise AI applications.
- Share Repurchase Program: The announcement of a $5 billion share repurchase authorization, including a $2 billion accelerated buyback, demonstrates management's confidence in the stock's current valuation and aims to enhance shareholder value.
See More
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- Questionable Timing: Congressman John McGuire's rapid buying and selling of Microsoft stock within just 10 days raises concerns about the unusual nature of his trading activities, particularly given his role on the Armed Services Committee, which may present potential conflicts of interest.
- Disclosure Details: The trades were executed by McGuire's spouse through an IRA, with a maximum disclosed trade size of $15,000, suggesting he may not have been directly involved in the transactions, which raises questions about transparency.
- Market Reaction Analysis: Microsoft shares traded between $438.68 and $452.69 at purchase and fell to $426.45 to $439.60 at sale, indicating a potential loss of 5.8%, highlighting the risks associated with his investment decisions.
- Historical Trading Context: Since joining Congress in 2025, McGuire has had minimal trading activity, with previous trades also drawing scrutiny regarding potential conflicts of interest in the healthcare sector, intensifying public scrutiny of his trading behavior.
See More
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- Cloud Revenue Growth: Amazon's cloud computing segment reported a revenue of $35.6 billion in Q4, reflecting a 24% year-over-year increase that surpassed analyst expectations, showcasing the segment's robust performance and ongoing growth potential in the market.
- Operating Margin Improvement: AWS achieved a 35% operating margin, slightly widening from the previous quarter, indicating positive progress in cost control and efficiency enhancement, thereby strengthening its profitability.
- Impact of AI Technology: AWS CEO Matt Garman stated that while market fears regarding AI models potentially slowing software company growth are overblown, AI is indeed a disruptive force that will change how software is consumed and built, emphasizing the necessity for continuous innovation.
- Growing Customer Demand: Garman highlighted that customer demand for computing technology and infrastructure will continue to rise, whether through self-building, AI-based solutions, or purchasing from SaaS vendors, a trend that will drive AWS's future business expansion.
See More
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- Cloud Growth Exceeds Expectations: Amazon Web Services reported a 24% revenue increase in Q4, reaching $35.6 billion, surpassing analyst expectations and demonstrating strong performance in the cloud infrastructure market despite pressures on overall software stocks.
- Market Panic Overreaction: AWS Chief Matt Garman stated that investor fears regarding AI models potentially slowing software company growth are overblown, emphasizing that core business metrics have not deteriorated, reflecting an excessive market reaction to technology stocks.
- AI-Driven Industry Transformation: Garman noted that AI will change how software is consumed and built, and while large SaaS providers face challenges, they still have an advantage in innovation and must continuously evolve to avoid disruption.
- Sustained Customer Demand: AWS anticipates that customers will require more compute technology and infrastructure than ever before, whether self-built, AI-based, or purchased from SaaS vendors, indicating ongoing demand for cloud services and market potential.
See More
US Jobs Data Damps Market Sentiment
- Job Growth Surprises: The Bureau of Labor Statistics reported that 130,000 jobs were added in January, significantly exceeding Dow Jones' expectation of 55,000, indicating potential economic recovery but raising concerns about possible interest rate hikes by the Federal Reserve.
- Negative Market Reaction: The strong jobs report dampened market sentiment as it reduced the likelihood of interest rate cuts, causing the Dow to snap a three-day winning streak, leading investors to adopt a cautious outlook on future market conditions.
- Concentration in Job Gains: Despite the notable job growth, the gains were heavily concentrated in healthcare-related sectors, raising concerns about the lack of opportunities in other industries, which could hinder a broad-based economic recovery.
- Ongoing AI Fears: Stocks of software companies like ServiceNow and Salesforce fell by over 5% and 4% respectively, reflecting ongoing investor anxiety regarding the impact of artificial intelligence technologies, which further exacerbated market unease.
See More
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- Software Selloff: After three consecutive days of gains, the iShares Tech-Expanded Software Sector ETF (NYSE:IGV) fell over 3% on Wednesday, indicating a decline in market confidence towards the software sector, which could impact investor sentiment towards tech stocks overall.
- Strong Jobs Data but Severe Revisions: Although January's nonfarm payrolls rose by 130,000, significantly exceeding economists' expectations of 70,000, the total U.S. job growth for 2025 was drastically revised down to just 181,000, highlighting the fragility of economic recovery and potentially raising concerns about future growth.
- Unexpected Drop in Unemployment Rate: The unemployment rate fell from 4.4% to 4.3%, which appears positive on the surface; however, this contrasts sharply with the downward revisions in job growth, possibly leading investors to question the economic outlook.
- Robinhood's Poor Market Performance: Robinhood Markets Inc. (NASDAQ:HOOD) saw its stock tumble 12% following a revenue miss and disappointing cryptocurrency trading results, reflecting market concerns about its future profitability and potentially undermining investor confidence.
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