ServiceNow on Monday outlined its long-term financial goals and early signs of traction, making a stronger case to investors that it can grow in the age of AI.
Gina Mastantuono, ServiceNow’s president and chief financial officer, said in a meeting with analysts that the company is targeting more than $30 billion in subscription revenue by 2030, up from an expected $15.7 billion in 2026. The CFO added that there is potential for upside to more than $32 billion, implying a compound annual growth rate of about 20%.
ServiceNow also denied concerns that AI could hurt profit margins. The company said AI inference accounts for less than 10% of its service costs, helping it maintain gross margins of more than 80% even as AI usage increases.
Mastantuono also expects operating margins and free cash flow margins to expand by 100 basis points in 2027. By 2030, ServiceNow aims to reach the “60+ rule,” a high bar that combines revenue growth with a total free cash flow margin of 60%.
Shares of many software stocks have plummeted over the past year on concerns that generative AI tools could reduce demand for software and help customers create their own software to replace traditional products. ServiceNow’s new forecast is aimed at reassuring investors that AI is not a threat to the company’s business, but could instead become a key growth driver.
The update comes after ServiceNow had a strong first quarter, with subscription revenue up 22% year-over-year to $3.67 billion. Still, the stock price fell after the earnings report due to concerns about the impact of AI, margins, and trading delays due to the Middle East conflict.
Monetizing AI is central to ServiceNow’s new pitch. The CFO said on Monday that annual contract value (ACV) for the company’s flagship AI product, Now Assist, exceeded $600 million in 2025 and exceeded $750 million as of the first quarter of 2026. The company expects that amount to exceed $1.5 billion by the end of this year and account for more than 30% of total ACV by 2030.
Data suggests that AI is increasingly being incorporated into ServiceNow’s larger transactions. In 2025, 91% of net new ACV came from customers who purchased five or more products, and multi-product transactions, including Now Assist, skyrocketed.
ServiceNow also uses its own operations as a proof of concept. Internal AI implementation will generate $500 million in annual value by 2025, including $100 million in operating expense savings. These savings are expected to accelerate to more than $200 million in 2026.
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