ServiceNow, Salesforce Surge on Government AI Deals
Enterprise software stocks ServiceNow and Salesforce are experiencing a surge in value as both companies secure major artificial intelligence contracts with US government agencies. According to reports, ServiceNow jumped roughly 6% while Salesforce climbed about 4%. The deals driving the rally include Salesforce's $5.6 billion, 10-year contract with the US Army for AI-driven military modernization and customer relationship management.
ServiceNow also announced its OneGov platform has secured an agreement with the General Services Administration that offers substantial discounts on AI workflow tools to government buyers. Additionally, ServiceNow bolstered its government AI capabilities through its acquisition of Moveworks, which adds conversational AI features purpose-built for public sector use cases.
The participation of Coinbase in the US Tech Force initiative alongside ServiceNow and Salesforce suggests that crypto firms are building institutional relationships with Washington that could eventually translate into their own government contracts. This trend is significant as it implies a potential multi-year spending cycle for companies with established government sales channels and proven AI deployment capabilities.
ServiceNow's FedRAMP High authorization gives it a competitive moat, making it more difficult for newer entrants to replicate its success in the market.