ServiceNow shares fell 11.9% on Monday due to two significant news events. First, the company is reportedly in talks to acquire Armis, a private US-Israeli cybersecurity firm, potentially valued at $7 billion. This acquisition would be expensive for ServiceNow.
Additionally, Keybanc analyst Jackson Ader downgraded ServiceNow’s shares to “Underweight”, predicting that generative artificial intelligence will lead to “seat count pressure” and disrupt the software sector. He believes this could impact valuations of companies like ServiceNow. The analyst also lowered its price target to $775.
The acquisition news is just one of several recent developments in the tech industry, highlighting concerns about the disruption brought by AI technology. However, some software companies that can harness AI’s potential may benefit from it.
Source: https://www.fool.com/investing/2025/12/15/why-servicenow-plunged-today