ServiceNow Beats SaaSpocalypse: 50% of New Contracts Now Usage-Based, Stock at Cheapest Valuation in Years

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Published today, ServiceNow's AI Control Tower — launched May 2025 to orchestrate, govern, and direct AI agents across enterprises — is driving a fundamental pricing pivot: roughly 50% of new contracts are now usage-based rather than seat-based subscriptions. Revenue grew 22% with remaining contract obligations up 25%, yet the stock trades at just 21x forward earnings (down 52% YoY, 62.4% from all-time highs). CEO McDermott argued on 'No Priors' that recreating enterprise platforms with LLMs alone would be prohibitively expensive due to infrastructure and token costs.