ServiceNow was once the hot new rising star of the tech world, with a rockstar CEO, double-digit growth, and confidence enough to take on other SaaS giants at their own game.
In the peak days of late 2024 and early 2025, NOW stock was trading at more than $220. Today, it’s less than $100. Far from the new kid on the block, ServiceNow might now be lumped in with Salesforce, DocuSign, and Adobe – legacy tech companies facing a ‘SaaSpocalypse’. Over a period of just a year-and-a-half, how and why has ServiceNow lost nearly 60% of its value?
Why Is NOW Stock Down So Much?
At the time of writing (2 PM BST, June 18), ServiceNow stock has dropped 51% over a year. The stock had earlier this month seen a brief revival, being boosted by around 36% over a five-day period, but it appears to have been something of a minor blip.
ServiceNow is not alone in this situation. Over a one-year period, Salesforce stock is down 41%, HubSpot is down 67%, and DocuSign is down 43%.
Software-as-a-service (SaaS) providers have been battling a narrative of the ‘SaaSpocalypse’, an apparently ongoing situation where AI might replace a good amount of the work traditional software vendors (like ServiceNow) have provided.
The bear case is that AI agents, coding tools, and automation platforms could let SaaS customers build lighter workflow apps in-house, reduce service-desk headcount, or put pressure on traditional seat-based SaaS pricing.
So does the future hang in the balance for the likes of ServiceNow, Salesforce, and other SaaS providers? Or is it just growing pains from new demands brought about by AI?
Strong Signs of Life
Despite the apparent SaaSpocalypse, there are reasons to be hopeful for ServiceNow.
Its Q1 2026 results, released in April, were strong, with subscription revenues at $3.67B, representing 22% year-over-year (YoY) growth, or 19% in constant currency (CC). This was actually higher than guidance from the previous quarter, which projected $3.65B.
Total revenue was also $3.77B over the same period – representing 22% YoY growth (19% in CC).
ServiceNow CEO Bill McDermott said at the time: “ServiceNow’s first quarter performance beat the high end of our guidance, once again.”
Despite this, the company has seemingly not been able to shake investors’ fears of a SaaSpocalypse. Even following the impressive Q1 earnings, NOW stock still dropped.
But ServiceNow is still a strong business. The market simply appears to have stopped viewing it as an untouchable compounder. Investors seem to want proof that ServiceNow’s own AI offerings will offset the disruption done by AI to its traditional software model.
NowBen Founder Ben McCarthy said that we’re “still very much in the SaaSpocalypse”, but added: “ServiceNow is very profitable, they’ve got their niche, and they’ve got AI. People are just not sure how this is going to play out.”
A wave of several high-profile tech sector IPOs from OpenAI, SpaceX, and Anthropic might also be worth considering as a factor.
There’s only so much money in the world, and if ServiceNow and other legacy SaaS companies are no longer seen as high-growth stock, capital will move away into other tech companies that investors see more of a future in.
Final Thoughts
Signs of life are popping up here and there for major software companies, but looking at their performance over the longer-term, SaaSpocalypse fears seem valid – or at least, worth considering.
But major SaaS companies are still pivoting hard into AI. Maybe this is where salvation, and a return to previous stock highs, can be found.