ServiceNow shares fall 24% after quarterly report — CNBC

Shares of enterprise software developer ServiceNow fell 24% on Thursday after the company released its third-quarter results. This brought the company’s stock closer to its worst day in history, CNBC reports.

Revenue met expectations

ServiceNow’s quarterly revenue rose by more than 20% to $4.11 billion. This was roughly in line with the forecast of analysts surveyed by LSEG, who expected $4.10 billion.

At the same time, the company’s adjusted earnings were $1 per share, while analysts had forecast $1.02. Citi analyst Tyler Radke told CNBC that such a lack of an earnings beat was unusual for ServiceNow.

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Concerns over the impact of AI

The results failed to ease investor concerns that new artificial intelligence capabilities could change the traditional business models of companies operating under the software-as-a-service model.

Despite the share decline, ServiceNow slightly raised its 2026 annual subscription revenue forecast to $15.78–$15.79 billion. The net new AI contract value metric increased by 65%.

According to Radke, investors are also concerned about the lack of a quick return on investments in a new team of engineers who work directly at client companies to develop AI solutions. He believes a noticeable turning point should not be expected before next year.