ServiceNow's AI Momentum Still Too Small to Inflect Overall Growth, Truist Says

02:45 PM EDT, 10/29/2026 (MT Newswires) -- ServiceNow's (NOW) accelerating momentum in artificial intelligence is still too small to inflect the overall growth of the business, Truist Securities said in a Thursday note. The company reported Q3 non-GAAP earnings late Wednesday of $1.00 per diluted share on revenue of $4.11 billion. Analysts polled by FactSet expected EPS of $1.02 on revenue of $4.09 billion. Truist analysts said Q3 results were "solid," but the magnitude of the beat came in below investor expectations. The company's Q4 guidance for current remaining performance obligations of 18.5% in constant currency also came in weaker than investors expected, setting a lower starting point for 2027, the analysts said. AI net new annual contract value grew 65% from a year ago, and the company boosted its year-end target for AI annual contract value to $1.7 billion from $1.5 billion previously. Traction of its Action Fabric framework is "promising" but has yet to result in a visible inflection in overall growth in current remaining performance obligations and subscription, the analysts said. Truist maintained the company's stock rating at buy and lowered the price target to $150 from $180. Price: 109.80, Change: -40.33, Percent Change: -26.86