ServiceNow Beat Earnings, Crossed $1B in AI Contract Value — and Still Closed Down 4% Because of Presence

MarketWatch via Morningstar·high signal

ServiceNow posted Q2 subscription revenue of $3.88B (+25% YoY), current remaining performance obligations up 21% to $13.2B, and AI annual contract value past $1B — ahead of schedule against a $1.5B year-end target — yet shares reversed a 2% morning gain to close down nearly 4% on July 23, and are down 38% YTD. Bank of America's Tal Liani argued ServiceNow's status as the enterprise system of record is a 'key strategic advantage versus third-party AI tools' that must extract and reintegrate data; TD Cowen countered that Presence 'represents a new push to play in the AI agent building, orchestration and governance layers.' For builders the lesson is that AI revenue traction no longer buys narrative protection — being the system of record is now the only defense being underwritten.