# ServiceNow earnings miss forecasts, AI fears drive 24% stock drop

Digest AI · Business & Funding · published 2026-10-29T14:58:03Z

Canonical: https://digestai.news/story/servicenow-earnings-miss-forecasts-ai-fears-drive-24-stock-drop

## Summary

ServiceNow’s stock fell 24% on Thursday after its third-quarter results disappointed investors, reigniting concerns about AI disrupting traditional enterprise software. Revenue grew over 20% to **$4.11 billion**, matching analyst estimates of **$4.10 billion**, but adjusted earnings came in at **$1.00 per share**, below the forecast of **$1.02**.

Analyst Tyler Radke of Citi noted the lack of immediate returns from ServiceNow’s new forward-deployed engineering team, which builds AI solutions for enterprises. Radke suggested the market wanted faster results, calling it a ‘waiting game’ that may only show progress in 2027. The stock decline follows broader ‘SaaSpocalypse’ fears about AI eroding legacy software revenue models.

## Key points

- ServiceNow’s stock dropped 24% after Q3 earnings missed analyst expectations for adjusted earnings per share
- Revenue grew 20% to **$4.11 billion**, matching estimates, but earnings fell short of the **$1.02** forecast
- Investors question AI investments’ payoff, with Radke of Citi calling for delayed results until 2027

## Why it matters

Weaker-than-expected earnings from a major enterprise software player signals growing investor caution about AI’s impact on legacy SaaS revenue streams.

## Sources

1. [ServiceNow shares plunge 24% after earnings revive AI disruption fears](https://cnbc.com/2026/10/29/servicenow-now-earnings-q3-2026.html) (CNBC Technology, 2026-10-29)

## Cite

Digest AI, "ServiceNow earnings miss forecasts, AI fears drive 24% stock drop", 29 October 2026, https://digestai.news/story/servicenow-earnings-miss-forecasts-ai-fears-drive-24-stock-drop

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