ServiceNow Down 51% as Wall Street Bets AI Will Gut Its Business; July 22 Earnings to Test Thesis
ServiceNow (NYSE: NOW) shares have fallen 51% from their 52-week high to around $103, driven by Wall Street fears that generative AI will erode demand for enterprise software. The company reports Q2 earnings on July 22, 2026, which will serve as a key test of the AI-disruption thesis. Despite the sell-off, ServiceNow's Q1 results showed strong growth: subscription revenue rose 22% year over year to $3.67 billion, current remaining performance obligations (cRPO) grew 22.5% to $12.64 billion, and large deals over $5 million in net new annual contract value surged nearly 80%. The company's AI offering, Now Assist, saw customers with over $1 million in annual contract value grow more than 130%. Management guides for Q2 subscription revenue of $3.815 billion to $3.82 billion, representing about 22.5% growth. The article highlights cRPO as a key metric for bears to watch, as it could signal demand erosion before it hits reported revenue.
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