As of 9:31 p.m. ET in New York on Friday, December 26, 2025, U.S. stock exchanges are closed for regular trading. ServiceNow, Inc. (NYSE: NOW) finished the day around $153.88 per share, up about 0.85% in a light, post-holiday session—leaving investors to digest a busy stretch of headlines that include a major cybersecurity acquisition, a recent 5-for-1 stock split, and fresh analyst debate about how AI could reshape the enterprise software landscape. [1]
ServiceNow is ending the week with the broader market still hovering near all-time highs, even after a quiet Friday pullback. The S&P 500 closed at 6,929.94, the Dow at 48,710.97, and the Nasdaq at 23,593.10 in subdued trading volume, as many institutions have effectively wrapped up year-end positioning. [2]
For ServiceNow stock, the immediate story is less about Friday’s tape and more about what comes next: investors are weighing whether the company’s aggressive push into AI-driven workflows and cybersecurity can offset concerns about deal risk, valuation, and potential AI-led disruption in software pricing and competitive moats.
Market backdrop: Santa rally vibes, but volume is thin
Friday’s session fit the seasonal pattern: a “post-Christmas” market with fewer catalysts and lower liquidity. Reuters noted stocks ended slightly lower, snapping a short winning streak, while remaining near records as the market moves through the traditional “Santa Claus rally” window at year-end. [3]
Looking into next week, Reuters also highlighted two macro drivers that can matter for high-multiple software names like ServiceNow:
- The Federal Reserve’s rate path (including the next batch of Fed meeting minutes due next week), and
- How investors position into year-end as the S&P 500 flirts with the 7,000 milestone. [4]
For NOW stock specifically, that macro context matters because valuations in enterprise software tend to be sensitive to yields and expectations for growth durability—especially when M&A enters the picture.
The biggest catalyst: ServiceNow’s $7.75 billion Armis acquisition
The most important current headline around ServiceNow is its agreement to buy Armis for approximately $7.75 billion in cash, in what the company describes as a move to expand security coverage across IT, operational technology (OT), medical devices, and broader cyber-physical environments. ServiceNow expects to fund the deal using a mix of cash on hand and debt, with closing anticipated in the second half of 2026, subject to regulatory approvals and other conditions. [5]
Why ServiceNow wants Armis
In its announcement, ServiceNow positioned the combination as a way to create an end-to-end security exposure and operations stack that can “see, decide, and act” across enterprise footprints—pairing Armis’ real-time discovery and exposure management with ServiceNow’s workflow automation and remediation. [6]
ServiceNow President/COO/CPO Amit Zavery framed the strategy bluntly: “ServiceNow is building the security platform of tomorrow.” [7]
Armis CEO Yevgeny Dibrov emphasized the expanding threat surface—particularly as AI and connectivity accelerate—and argued the combined platform can help customers act before incidents occur, not just respond afterward. [8]
Notably, the press release also included a comment from Larry Feinsmith, Head of Global Tech Strategy, Innovation & Partnerships at JPMorgan Chase, pointing to the operational complexity AI introduces: “The benefits and value will be enormous, but so is the complexity.” [9]
What Wall Street is worried about
Even when the strategic rationale makes sense, mega-deals tend to raise questions that can pressure software stocks in the short run:
- Price paid vs. organic growth (is M&A compensating for slowing demand?),
- Integration risk (product, go-to-market, talent retention), and
- Balance-sheet impact (debt-funded cash deals can change the risk profile).
ServiceNow itself flags those risks in its forward-looking statements, including the possibility of delays or difficulty integrating Armis, retaining employees post-close, and management distraction. [10]
Coverage across major outlets reflected that mixed reaction. MarketWatch reported investor concerns about the cost and reliance on inorganic growth, even as it noted Armis’ scale and growth profile and ServiceNow’s desire to expand cybersecurity capabilities in the AI era. [11]
Reuters also reported ServiceNow’s view that the Armis deal would triple the market opportunity for its security and risk business, and cited CFO Gina Mastantuono saying: “Our security stack, with the acquisition of Armis, is very well positioned, so we won’t need to do any more M&A in security space.” [12]
Stock split recap: what changed for NOW shareholders
A major technical event also just hit ServiceNow shares: a 5-for-1 stock split.
ServiceNow said shareholders approved the split, with holders of record as of December 16, 2025 receiving four additional shares for each share held, distributed after market close around December 17, with split-adjusted trading beginning December 18, 2025. [13]
For investors, the key takeaway is straightforward:
- The split does not change ServiceNow’s underlying business value.
- It does change the per-share price and share count, which means older price targets (and historical quotes) may appear “off” unless adjusted.
At roughly $154 per share after the split, the stock’s pre-split equivalent would be about $770—useful context when comparing headlines written before and after the effective date. [14]
Analyst outlook and forecasts: upgrades, downgrades, and where targets cluster
Recent analyst actions show the market is actively repricing “quality software” in an AI-heavy world—especially when M&A is layered on top.
KeyBanc downgrade: “structural AI” concerns
In mid-December, KeyBanc downgraded ServiceNow to Underweight, highlighting AI-related disruption risks for parts of the enterprise software model. Multiple summaries of the downgrade pointed to the firm’s view that AI could pressure traditional SaaS dynamics and competitive positioning. [15]
Guggenheim upgrade: valuation reset
Shortly after, Guggenheim moved the stock from Sell to Neutral, with the reasoning largely tied to valuation after the drawdown—an acknowledgment that while challenges remain, the price may better reflect them. [16]
BTIG and other bullish voices: “buy the dip” camp
Other firms remain constructive. BTIG initiated/maintained a Buy view in December coverage, highlighting long-term opportunity (while targets may vary depending on split adjustments and provider data). [17]
Consensus price targets (split-adjusted)
Across widely followed consensus aggregators, price targets cluster in the low-to-mid $220s (split-adjusted), implying meaningful upside if execution remains strong:
- StockAnalysis lists an average target around $223 with a Strong Buy consensus (with targets spanning roughly $155 to $260). [18]
- MarketBeat shows a similar average near $224, with a broader published range depending on the analyst set. [19]
- Fintel’s compilation also centers around the $230 neighborhood (provider methodology varies). [20]
Fundamentals: what ServiceNow reported last quarter and guided for Q4
The last official earnings anchor remains ServiceNow’s Q3 2025 report (released October 29, 2025). In that release, ServiceNow reported:
- Subscription revenue:$3.299 billion (GAAP), up 21.5% year over year
- Total revenue:$3.407 billion, up 22% year over year
- cRPO:$11.35 billion, up 21% year over year
- RPO:$24.3 billion, up 24% year over year [21]
ServiceNow’s guidance in the same release pointed to continued growth and strong margins:
- Q4 2025 subscription revenue:$3.420–$3.430 billion (about 19.5% YoY growth)
- Full-year 2025 subscription revenue:$12.835–$12.845 billion (about 20.5% YoY growth)
- Operating margin (non-GAAP):30% for Q4 and 31% for full-year 2025
- Free cash flow margin (non-GAAP):34% for full-year 2025 [22]
One underappreciated risk note: ServiceNow warned that U.S. federal agencies are navigating budget shifts and mission demands, and that a recent government shutdown could impact deal timing—an important detail given the company’s public-sector exposure. [23]
AI strategy: why ServiceNow keeps pushing deeper into “agentic” workflows
ServiceNow is increasingly pitching itself as an “AI platform for business transformation,” not just IT service management. In recent product and partnership updates, the company has emphasized:
- Model flexibility (using platform-native LLMs and third-party models), and
- Workflow orchestration across tools employees already live in.
For example, ServiceNow announced an “AI Experience” layer and highlighted model-provider flexibility that includes options such as Azure OpenAI, Anthropic on AWS, and Google Gemini models—positioning itself as the orchestration and governance layer above models. [24]
ServiceNow also announced integrations with Microsoft aimed at connecting Now Assist to Microsoft 365 context (Word, Outlook, Teams) in ways that can trigger enterprise workflows with governance. [25]
Moveworks acquisition completed
ServiceNow also closed another major AI bet: the completion of its Moveworks acquisition. In the closing announcement, ServiceNow said the combination is designed to create an “AI-native front door” for employee engagement, blending workflow automation with an AI assistant and enterprise search. [26]
Amit Zavery described the strategic intent this way: “Moveworks accelerates ServiceNow’s vision to put AI to work for people across every corner of every business.” [27]
This matters for NOW stock because investors are trying to judge whether ServiceNow’s AI positioning becomes a durable moat—or whether AI commoditizes parts of the SaaS stack and shifts pricing power toward model providers and new workflow entrants.
What investors should know before the next market session
Because it’s after the close in New York, the next actionable window is the next regular session on Monday, December 29, 2025. Here are the practical items investors commonly watch for NOW stock into that open:
- Low-liquidity risk remains real. Post-holiday trading has been light, and Reuters noted thin conditions in the “Santa rally” period. That can exaggerate moves—up or down—especially in large-cap tech. [28]
- Watch macro headlines that move growth multiples. Next week’s Fed-related releases (including minutes) and shifting rate expectations can quickly rerate enterprise software valuations. [29]
- Track any follow-on details on Armis financing and regulatory timing. The deal is planned as an all-cash acquisition funded by cash plus debt, with a long runway to a second-half 2026 close—meaning investor focus may shift to balance-sheet strategy and integration planning commentary. [30]
- Expect continued analyst “push-pull.” The stock has recently drawn both downgrades (AI disruption concerns) and upgrades (valuation reset). If additional notes hit Monday morning, they can drive early volatility. [31]
- Know the recent trading range and reference points. Data providers show NOW recently closed around $153.88 on December 26, and it has been well below its split-adjusted 52-week high near $239.62 from late January—levels traders often use for context on trend and mean reversion. [32]
- Mark the next earnings window. Earnings calendars broadly point to late January 2026 for the next report (exact dates can vary by provider until confirmed by the company), which will be a key catalyst for guidance, AI monetization commentary, and any updated deal color. [33]
Bottom line for ServiceNow stock
ServiceNow stock is entering the final stretch of 2025 with a market backdrop that remains supportive—indexes near records—but with company-specific debates intensifying. Bulls see a platform leader expanding into cybersecurity and building an AI “control tower” for enterprise workflows. Bears worry that big-ticket M&A and fast-moving AI shifts could pressure the classic SaaS playbook.
Monday’s open is less about “what happened today” and more about whether the market starts to price the Armis deal as strategic acceleration—or as execution risk—at a time when investors are increasingly unforgiving about growth quality, margin durability, and capital allocation. [34]
References
1. www.investing.com, 2. apnews.com, 3. www.reuters.com, 4. www.reuters.com, 5. newsroom.servicenow.com, 6. newsroom.servicenow.com, 7. newsroom.servicenow.com, 8. newsroom.servicenow.com, 9. newsroom.servicenow.com, 10. newsroom.servicenow.com, 11. www.marketwatch.com, 12. www.reuters.com, 13. newsroom.servicenow.com, 14. www.investing.com, 15. finance.yahoo.com, 16. www.tipranks.com, 17. finance.yahoo.com, 18. stockanalysis.com, 19. www.marketbeat.com, 20. fintel.io, 21. www.servicenow.com, 22. www.servicenow.com, 23. www.servicenow.com, 24. newsroom.servicenow.com, 25. newsroom.servicenow.com, 26. www.moveworks.com, 27. www.moveworks.com, 28. www.reuters.com, 29. www.reuters.com, 30. newsroom.servicenow.com, 31. finance.yahoo.com, 32. www.investing.com, 33. www.tipranks.com, 34. newsroom.servicenow.com
