ServiceNow Is Down 51% as Wall Street Bets AI Will Gut Its Business. July 22 Will Show Who's Right.

ServiceNow (NOW) has dropped 51% from its 52-week high as Wall Street prices in the risk that artificial intelligence could dismantle its enterprise software model. The sell-off reflects growing skepticism that traditional workflow automation platforms can withstand AI-native competition.

The market's bearish thesis faces a critical test on July 22, when ServiceNow reports second-quarter earnings. First-quarter results showed subscription revenue climbing 22% year-over-year, alongside what the company characterized as robust contract metrics—signs that enterprise customers remain committed to the platform despite AI disruption concerns.

The divergence between stock performance and underlying revenue growth suggests investors are either anticipating a sharp slowdown or preemptively discounting a lower-growth future. ServiceNow's ability to integrate AI capabilities into its own platform—rather than being displaced by them—will likely determine whether the 51% drawdown represents capitulation or foresight.