ServiceNow Plunges 27%, Worst Day on Record — SkimNews
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- ServiceNow shares sank 27% on Thursday, the enterprise software company's worst day on record, after its third-quarter results underwhelmed.
- LSEG-polled analysts had forecast $4.10 billion in revenue; ServiceNow's third-quarter revenue grew more than 20% to $4.11 billion, roughly in line with that estimate.
- ServiceNow adjusted earnings came up short at $1.00 per share, against a forecast of $1.02.
- ServiceNow slightly lifted its full-year 2026 subscription revenue outlook to between $15.78 billion and $15.79 billion, and the stock fell anyway.
- ServiceNow net new AI average contract value jumped 65%.
- Tyler Radke of Citi said the lack of upside was uncharacteristic for ServiceNow standards and that investors spooked by the lack of immediate payoff from the company's newly formed forward-deployed engineering team will have to wait until next year to really see the inflection.
- "SaaSpocalypse" fears persisted: the results did little to overturn concerns that new AI capabilities will upend traditional software business models.
Why it matters: A two-cent-per-share earnings miss brought a record 27% selloff even as ServiceNow raised its 2026 subscription revenue outlook to $15.78 billion–$15.79 billion and net new AI contract value jumped 65%. The gap the market focused on was timing: Radke said investors wanted visible payoff from the forward-deployed AI team sooner and pointed to next year for the inflection.
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