ServiceNow sees AI growth as annual contract value exceeds $1 billion

ServiceNow is experiencing significant growth driven by the adoption of its agentic artificial intelligence (AI) portfolio. The company reported that its AI annual contract value (ACV) surpassed $1 billion in the second quarter of 2026, and it remains on track to meet its $1.5 billion AI ACV target by the end of the year.

Chief Financial Officer Gina Mastantuono noted that AI is acting as an expansion opportunity rather than a source of budget pressure. She observed that customers are often reallocating labor pool budgets toward software investments to achieve productivity gains. ServiceNow expects to generate $500 million in AI-related efficiencies this year.

The company’s momentum is characterized by a ninefold increase in customers running Agentic AI in production over the last nine months. Additionally, deals involving five or more ServiceNow AI products have grown 5.5 times year over year. ServiceNow is also seeing a shift toward non-seat-based revenue, with 50% of net new business already falling into this category as autonomous agents become more prevalent.