ServiceNow, Inc. (NYSE: NOW) ended Tuesday’s session lower and drifted slightly further in after-hours trading as investors digested two market-moving developments: the company’s announced $7.75 billion acquisition of cybersecurity firm Armis and a late-day SEC filing that extends CEO Bill McDermott’s leadership runway and updates severance terms.
As of early evening in New York, ServiceNow closed at $154.36 and traded around $154.10 after hours (down about $0.26, or 0.17%). [1]
Below is what happened, why it matters, and the key items to watch before the opening bell on Wednesday, Dec. 24, 2025—a holiday-shortened U.S. session.
What moved ServiceNow stock today: the $7.75B Armis acquisition
The dominant catalyst for NOW stock on Dec. 23 was ServiceNow’s confirmation that it has agreed to acquire Armis for approximately $7.75 billion in cash—the company’s largest acquisition to date. [2]
ServiceNow is pitching the deal as a fast-track expansion of its security ambitions in an era where AI is both increasing productivity and amplifying attack surfaces. The company says Armis will help extend security coverage across IT, operational technology (OT), and medical/connected devices, and management framed the combination as building a unified security exposure and operations “stack” that can “see, decide, and act” across the tech footprint. [3]
Key deal terms investors are focusing on tonight
From ServiceNow’s announcement:
- Purchase price: about $7.75 billion, all-cash (subject to customary adjustments). [4]
- Funding: ServiceNow expects to fund the transaction using a combination of cash on hand and debt. [5]
- Timing: expected to close in the second half of 2026, subject to regulatory approvals and other closing conditions. [6]
- Armis scale (as disclosed by ServiceNow): Armis has surpassed $340 million in annual recurring revenue (ARR) with year-over-year ARR growth exceeding 50%. [7]
- Headcount / footprint: Armis has a team of approximately 950 and is used by large enterprises (ServiceNow cites Global 2000 adoption, including 35% of the Fortune 100). [8]
One detail that also stands out for context: TechCrunch reported Armis raised a $435 million pre-IPO funding round last month valuing it at $6.1 billion, underscoring how quickly the deal price escalated from the most recent private-market mark. [9]
Market reaction: a muted after-hours tape, but skepticism under the surface
ServiceNow’s shares were already under pressure going into today’s confirmation, after mid-December reports that a large Armis deal was nearing.
- On Dec. 15, NOW had a sharp selloff (a double-digit drop) when acquisition chatter hit. [10]
- On Dec. 23, the stock finished lower again and remained slightly down after hours. [11]
Reuters summarized the immediate investor posture well: the Armis deal is intended to boost ServiceNow’s cybersecurity offerings, but shares fell about 3% around the announcement as investors weighed price and execution risk. [12]
Why some investors see the deal as strategically logical
ServiceNow has been steadily reframing itself as an AI-era enterprise “control tower,” and Armis brings something ServiceNow doesn’t natively own at the same depth: agentless visibility into connected assets (including OT and medical devices), plus risk context that can be routed into enterprise workflows for remediation. [13]
Cybersecurity trade outlet Dark Reading highlighted how ServiceNow expects Armis data to extend its CMDB (configuration management database) and power more proactive, automated security workflows—potentially making ServiceNow more “sticky” in regulated industries and critical infrastructure. [14]
Why others are cautious (and why the stock hasn’t bounced)
The skepticism isn’t about whether cybersecurity matters—it’s about price, integration, and narrative:
- Valuation: Commentators today repeatedly pointed to a low-20s multiple of ARR implied by the deal size versus Armis’ disclosed ARR—rich even in security software when growth inevitably moderates. [15]
- Inorganic-growth optics: A major question for 2026 becomes whether ServiceNow is leaning on acquisitions to maintain momentum as core growth naturally decelerates at scale. [16]
- Financing: Funding with a mix of cash and debt can be sensible, but it also invites concerns about leverage, interest expense, and flexibility—especially if more deals follow. [17]
After the bell: a new SEC filing extends McDermott’s runway through at least 2030
A second, easy-to-miss development landed after market close: ServiceNow filed an 8‑K detailing amendments to CEO Bill McDermott’s employment agreement and changes to the CEO severance policy.
The filing says McDermott will remain in service to the company through at least Dec. 31, 2030, with flexibility to serve as CEO/co‑CEO or transition to (non‑)executive chair roles by mutual agreement. The company also updated severance and equity-vesting provisions for various termination scenarios, including change-in-control outcomes. [18]
For investors, this tends to cut two ways:
- Positive read: leadership continuity and clearer succession “runway,” which can matter during a large acquisition integration cycle.
- More cautious read: investors sometimes scrutinize change-in-control economics and governance terms, especially in active M&A periods.
Either way, it’s a material governance update that could shape how some institutions frame ServiceNow’s longer-term strategy and accountability.
Analyst and forecast roundup from today: bullish targets persist, but deal risk is now the debate
Despite today’s pullback, broad Wall Street positioning still leans positive on a 12‑month view—at least based on aggregated targets.
- MarketBeat lists a consensus price target of $225.09 (with a high target of $263 and low of $144.80). [19]
- TipRanks shows an average price target around $227.85 (high $263, low $155) and a consensus skewed toward Buy/Strong Buy. [20]
A notable single-note item today: TipRanks/TheFly reported Wells Fargo reiterated Overweight and kept a $255 price target, calling the Armis acquisition strategically aligned—but also warning the market could see “narrative noise” if investors conclude ServiceNow is leaning too heavily on inorganic growth as software growth slows. [21]
Important price-target housekeeping: the recent 5-for-1 stock split
If you’re comparing targets, headlines, or older notes, be careful: ServiceNow recently completed a 5-for-1 stock split.
- Shareholders approved the split, with trading on a split-adjusted basis expected to begin Dec. 18, 2025. [22]
- Some firms mechanically adjusted targets (for example, Oppenheimer cut its target to $230 from $1,150 after the split while maintaining its rating). [23]
Practical takeaway: when you see a $1,100–$1,300 target in older commentary, it may be pre-split, while the $220–$260 range is generally post-split—but not every source updates at the same speed.
What to know before the stock market opens tomorrow (Wednesday, Dec. 24, 2025)
Tomorrow’s session is not a normal “next day” setup. It’s Christmas Eve—and U.S. markets are open but close early, which affects liquidity, spreads, and headline sensitivity.
1) It’s a holiday-shortened session (and that can exaggerate moves)
Both NYSE and Nasdaq list Dec. 24, 2025 as an early close at 1:00 p.m. ET. NYSE also notes eligible options close at 1:15 p.m. ET, and some late trading sessions are scheduled to end at 5:00 p.m. ET. [24]
Meanwhile, SIFMA’s recommendations show the U.S. bond markets observe an early close (2:00 p.m. ET) on Dec. 24. [25]
What that means for NOW traders: thin volume can make the tape jumpy. A single analyst note or headline can move price more than it would on a normal Wednesday.
2) Watch for follow-on details that the first headline doesn’t answer
The press release gives the strategic “why,” but the market will quickly pivot to more granular questions. Items that could drive premarket chatter or intraday action tomorrow include:
- Integration plan: how Armis capabilities will be packaged and sold inside ServiceNow’s platform (especially into regulated industries and OT-heavy customers). [26]
- Financial impact framing: whether ServiceNow provides any view (even qualitative) on margin impact, cross-sell timing, or how quickly Armis could be accretive after closing (remember, closing is targeted for H2 2026). [27]
- Debt and capital allocation: any indication of intended leverage bands or whether the deal changes buyback posture.
3) The bull vs. bear split is now clear—and tomorrow may amplify it
Going into the next open, the market is effectively choosing between two narratives:
Bull case (strategic platform expansion):
- Armis strengthens ServiceNow’s “AI control tower” pitch by adding broad asset visibility and cyber exposure management that can feed automated workflows. [28]
Bear case (expensive M&A and uncertain synergies):
- The deal price implies a steep valuation multiple, and critics argue cybersecurity exposure management may not translate cleanly into ServiceNow’s core workflow DNA without heavy execution risk. [29]
Because tomorrow’s session is short, you may see sharper-than-usual swings between those two interpretations—especially if additional sell-side notes hit the tape.
4) Don’t ignore the governance headline that hit after close
The CEO agreement/severance 8‑K is not the primary driver today, but it’s the kind of filing that:
- gets picked up by governance-focused desks,
- influences how investors think about succession planning during major integration work,
- and can become a background factor in valuation discussions.
If you see tomorrow morning commentary referencing “leadership runway through 2030,” this is what they’re talking about. [30]
A quick premarket checklist for NOW stock (Dec. 24 open)
Before 9:30 a.m. ET tomorrow, here’s what’s worth scanning:
- Premarket price + spreads: expect thinner liquidity due to the holiday early close. [31]
- Any new analyst notes: especially around valuation, integration timing, and capital structure (Wells Fargo’s “strategic fit, but narrative noise” framing is likely to be echoed). [32]
- Deal detail follow-ups: anything more specific on packaging, go-to-market, and whether ServiceNow will provide incremental financial disclosures ahead of close. [33]
- Governance headlines: CEO agreement and severance-policy commentary that could influence longer-term holders. [34]
- Session timing: plan around the 1:00 p.m. ET close for equities. [35]
Bottom line
ServiceNow stock is ending Dec. 23 with a familiar market posture: investors broadly agree cybersecurity is a high-priority spend area in the AI era, but they are still debating whether ServiceNow’s big, all-cash move for Armis is a value-creating platform expansion—or an expensive bet that adds leverage and integration complexity.
With a holiday-shortened session ahead, the “what to know before the open” message is straightforward: liquidity will be thinner, headlines may move the stock more than usual, and the next wave of analyst reaction could matter as much as the original deal announcement. [36]
This article is for informational purposes only and does not constitute investment advice.
References
1. stockanalysis.com, 2. newsroom.servicenow.com, 3. newsroom.servicenow.com, 4. newsroom.servicenow.com, 5. newsroom.servicenow.com, 6. newsroom.servicenow.com, 7. newsroom.servicenow.com, 8. newsroom.servicenow.com, 9. techcrunch.com, 10. stockanalysis.com, 11. stockanalysis.com, 12. www.reuters.com, 13. www.darkreading.com, 14. www.darkreading.com, 15. markets.financialcontent.com, 16. www.tipranks.com, 17. newsroom.servicenow.com, 18. www.stocktitan.net, 19. www.marketbeat.com, 20. www.tipranks.com, 21. www.tipranks.com, 22. newsroom.servicenow.com, 23. www.tipranks.com, 24. www.nyse.com, 25. www.sifma.org, 26. www.darkreading.com, 27. newsroom.servicenow.com, 28. www.marketwatch.com, 29. markets.financialcontent.com, 30. www.stocktitan.net, 31. www.nyse.com, 32. www.tipranks.com, 33. newsroom.servicenow.com, 34. www.stocktitan.net, 35. www.nyse.com, 36. www.nyse.com
