May AI Kill SaaS--But It Will Supercharge ServiceNow's Growth

Summary

• ServiceNow (NOW) remains a BUY as AI adoption accelerates, driving both revenue growth and profitability beyond seat-based models.
• NOW's hybrid pricing—combining seat- and usage-based models—enables upselling and breaks the traditional revenue floor, with 50% of new deals now non-seat-based.
• AI business momentum is strong: Now Assist spending over $1M grew 130% YoY, and full-year 2026 revenue guidance was raised to $15.7B (+21% YoY).
• Despite valuation premiums over Salesforce (CRM), NOW's sticky products, high renewal rates, and robust AI-driven growth position it as a SaaS winner.