ServiceNow NYSE: NOW Chief Financial Officer Gina Mastantuono said the company sees artificial intelligence as an expansion opportunity rather than a source of budget pressure, citing customer demand for AI-enabled workflow automation and the company’s own reported efficiency gains.
Speaking with Deutsche Bank Software Equity Research’s Brad Zelnick, Mastantuono said ServiceNow’s platform architecture—built around a single data model, architecture and platform—positions the company to help enterprises apply AI across functions including IT, human resources, finance, legal and customer service.
“In an AI world, autonomous work is more important than ever,” Mastantuono said. She pointed to billions of workflows and trillions of annual transactions on the platform, arguing that ServiceNow has the context, data and governance controls needed to help customers automate more work.
AI Spending and Internal Efficiency
Mastantuono acknowledged that businesses are increasing spending on AI tokens and that some companies may be reducing spending in other areas to accommodate those costs. However, she said ServiceNow is not seeing its business crowded out when its products demonstrate rapid value creation.
She said ServiceNow grew top-line revenue 23% in the second quarter while keeping headcount flat for the year, including the effects of acquisitions. The company expects to generate $500 million of AI-related efficiencies this year, according to Mastantuono.
“We’re seeing a lot of customers lean into a labor pool dollar budget for spend,” she said, describing productivity gains as a source of funding for software investments.
Mastantuono also said ServiceNow’s AI business crossed $1 billion in the second quarter and remained on track for the company’s previously stated $1.5 billion full-year target.
Growth Priorities and Capital Allocation
The CFO reiterated that organic innovation remains ServiceNow’s first capital-allocation priority, followed by tuck-in acquisitions and talent acquisitions. She also highlighted the company’s focus on shareholder returns, noting that ServiceNow completed a $2 billion share repurchase in the first quarter and had more than $4 billion remaining under its authorization.
ServiceNow’s long-term growth plan includes AI, security and risk, data and analytics, and customer relationship management. Mastantuono said the company expects its security and risk, data and analytics, and CRM portfolios to each grow more than 25% over a three-year period. The company has also said it expects AI to account for 30% of revenue by 2030.
She said the company’s AI-native bundles offer customers multiple entry points, from basic AI capabilities to its higher-end Prime package. ServiceNow has continued to see price increases of more than 30% for Prime, while other packages have generated uplifts between 20% and 30%, depending on bundling, she said.
Control Tower, Security and Data
Mastantuono described ServiceNow’s AI Control Tower as a vendor-agnostic governance layer that can connect to multiple models, hyperscalers, software providers and data sources. She said customers want flexibility rather than dependence on a single AI vendor, while CFOs are seeking tools to manage AI spending and measure return on investment.
Control Tower can help companies monitor spending, governance and controls, including a “kill switch” for AI systems that behave improperly, she said.
In cybersecurity, Mastantuono said ServiceNow’s security and risk business surpassed $1 billion in annual contract value during the third quarter of the prior year. Following the acquisitions of Armis and Veza, she said ServiceNow is now a top-eight security provider globally and can offer customers capabilities spanning detection, alerting, decision-making and remediation.
She added that the acquired businesses exceeded their plans in their first quarter under ServiceNow and helped drive demand for the company’s core security and risk, configuration management database and IT operations management offerings.
Data and analytics is another strategic focus, according to Mastantuono. She said ServiceNow’s Workflow Data Fabric and connectors are intended to let customers use data from across their organizations regardless of where it resides, combining that information with AI, workflow and security tools.
CRM, Customer Use Cases and Public Sector
Mastantuono said ServiceNow’s CRM business has surpassed $2 billion and that its acquisition of Logik.ai has expanded its configure-price-quote capabilities. She said the company can offer quote, fulfillment and service functions on one platform.
She highlighted early AI customer deployments, including the City of Raleigh’s use of ServiceNow’s Level 1 specialist. According to Mastantuono, Raleigh achieved 98% accuracy and automated 65% of requests without human intervention within 10 to 15 weeks. In another 12-week pilot, a customer generated more than $5 million in efficiency benefits from one Level 1 specialist use case, she said.
Mastantuono also said ServiceNow sees a growing opportunity in U.S. federal agencies and the broader public sector as organizations modernize systems and pursue AI-driven productivity. The company overachieved its federal plan in the second quarter and entered the second half with a strong pipeline, she said.
Looking ahead, Mastantuono said ServiceNow plans to address a wider range of small and medium-sized businesses with a forthcoming product designed for that market. She also said the company has built six businesses with more than $1 billion in revenue internally, underscoring its continued emphasis on organic innovation.
About ServiceNow (NYSE:NOW)
ServiceNow NYSE: NOW is a cloud computing company that builds enterprise software to manage digital workflows and automate business processes. Its offerings are designed to replace manual work and legacy systems with cloud-based, service-oriented applications that support IT operations, customer service, human resources, security response and other enterprise functions.
The company's flagship product family is the Now Platform, a suite of subscription software and platform services that includes IT Service Management (ITSM), IT Operations Management (ITOM), IT Business Management (ITBM), Customer Service Management (CSM), HR Service Delivery, Security Operations and Asset Management.
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