New York, January 30, 2026, 18:17 ET — After-hours
- Shares rose 0.1% in after-hours trading, following a nearly 10% slide the previous day after earnings.
- The company raised its 2026 subscription revenue forecast, surpassing estimates, and boosted its share buyback authorization.
- Traders weigh AI-driven competition alongside deal integration risks and the question of whether software sentiment will hold steady.
ServiceNow shares nudged higher by 0.1% in after-hours trading Friday, closing at $117.01. During the session, the stock fluctuated between $115.51 and $118.78.
Friday’s quiet close doesn’t undo Thursday’s shock. Investors see the selloff as a clear sign that even strong software results don’t guarantee a free pass these days, not for a bellwether stock.
ServiceNow dropped 9.6% Thursday amid a wider retreat in enterprise software stocks. SAP slid following a cautious cloud forecast, while Salesforce, Adobe, and Datadog also lost ground. Adam Turnquist of LPL Financial noted the market seems to be “pricing a worst case scenario” as AI shakes up the sector. Investing.com
Shares dropped even though ServiceNow outpaced Wall Street’s forecasts. The company projects fiscal 2026 subscription revenue between $15.53 billion and $15.57 billion, surpassing the average analyst estimate of $15.21 billion from LSEG. For the first quarter, it forecast subscription revenue of $3.65 billion to $3.66 billion. Partnerships with Anthropic and OpenAI were key to its AI strategy, while Rebecca Wettemann, CEO of Valoir, noted the firm is “growing both organically and by acquisition.” Reuters
In its quarterly report, the Santa Clara, California-based firm revealed fourth-quarter subscription revenue jumped 21% to $3.466 billion, with total revenue up 20.5% at $3.568 billion. Current remaining performance obligations (cRPO), which track contracted revenue expected within the next year, climbed 25% to $12.85 billion. CEO Bill McDermott said the company “significantly beat Q4 expectations,” while CFO Gina Mastantuono highlighted a “disciplined focus on margin expansion.” ServiceNow Newsroom
ServiceNow boosted its shareholder returns plan, with the board approving an extra $5 billion for share buybacks. The company also announced an accelerated $2 billion repurchase, a move usually executed via a bank to retire shares swiftly.
ServiceNow revealed that its stock’s cheaper price reflects a 5-for-1 split, which went into effect on Dec. 17, 2025.
Dealmaking continues to fuel discussions around the stock. ServiceNow is set to acquire Armis and has sealed a deal to buy Veza, all while integrating Moveworks to expand its AI and security capabilities.
The company also flagged that its first-quarter subscription revenue growth forecast factors in roughly a 150-basis-point drag due to a shift in the mix toward hosted offerings. For clarity, a basis point equals one-hundredth of a percentage point.
Thursday’s sharp decline highlights the risks tied to expectations. If enterprise budgets shrink or new AI tools undercut workflow spending before customers fully embrace ServiceNow’s add-ons, the stock could remain tightly constrained despite the ongoing buyback.
Traders will soon focus on the launch of the accelerated repurchase, along with any new comments from management. The company’s annual Knowledge conference runs May 5-7 in Las Vegas, where it typically outlines product strategies and customer rollouts.
