AI Doesn't Replace Enterprise Software Giants: Salesforce and ServiceNow Blow Away Expectations
Investors had been betting that AI would replace enterprise software giants, but Salesforce and ServiceNow just reported blowout quarters that turned this fear on its head. Both companies' stocks surged after their earnings reports: CRM jumped 22.58% on earnings day, and NOW has climbed 25.14% over the last month.
Salesforce delivered $11.35 billion in revenue, up 10.8% year-over-year, with subscription and support revenue of $10.82 billion, up 12%. The company's AI stack is a key driver of growth, with Agentforce ARR crossing $1.5 billion, growing over 240% year-over-year.
ServiceNow's Q2 was even more impressive, with revenue of $3.987 billion growing 24.01% year-over-year. The company's AI ACV crossed $1.00 billion, and agentic deployments increased ninefold over nine months.
Both companies are expanding their platforms through AI, rather than being replaced by it. Salesforce is doubling down on being the trusted data spine for every agent, while ServiceNow is focusing on governance and cybersecurity.