ServiceNow (NOW) Stock Rockets 14% on AI Innovations and Software Sector Rally

Key Takeaways

• ServiceNow (NOW) climbed approximately 14% Friday, spearheading a significant software sector upswing
• Investor excitement built around new AI capabilities announced at Knowledge 2026, featuring the Otto assistant
• Bank of America resumed coverage with an optimistic perspective, positioning NOW as an agentic AI frontrunner
• The company’s board authorized a $4.2 billion stock repurchase program, boosting investor confidence
• The positive momentum rippled through software equities, lifting Snowflake, Oracle, Atlassian, and cybersecurity stocks

Shares of ServiceNow (NOW) skyrocketed approximately 14% during Friday’s trading session, delivering one of the year’s most impressive single-day performances in the software industry. By midday, the stock maintained its gains while the iShares Expanded Tech-Software Sector ETF (IGV) climbed 5% in parallel.

ServiceNow, Inc., NOW

This surge follows several weeks of downward pressure on software equities. Prior to Friday’s rally, NOW shares had declined nearly 29% year-to-date, reflecting market concerns about artificial intelligence potentially cannibalizing traditional enterprise software revenues.

The market sentiment appears to be reversing course.

During the Knowledge 2026 event, ServiceNow introduced cutting-edge generative AI capabilities, highlighted by the Otto assistant, while announcing strategic collaborations with Experian and Boomi. These revelations demonstrated how the company is integrating AI directly into its platform architecture instead of positioning it as a standalone offering.

At the Jefferies Software, Internet and AI conference this week, ServiceNow’s COO and Chief Product Officer Amit Zavery tackled the AI disruption narrative head-on.

Zavery further articulated why enterprise system-of-record platforms like ServiceNow maintain critical importance in an AI-dominated landscape.

Board Approves $4.2 Billion Repurchase; BofA Returns with Positive View

The stock benefited from two supplementary drivers. ServiceNow’s board greenlit a $4.2 billion share repurchase initiative, demonstrating management’s conviction in the company’s current price levels.

Separately, Bank of America resumed its ServiceNow coverage with an upbeat assessment, characterizing the firm as a pioneer in the developing agentic AI landscape. Such institutional endorsement typically influences hesitant investors to reconsider their positions.

Combined, these developments amplified what was already shaping up to be an exceptional trading day for the equity.

Broader Software Sector Experiences Widespread Gains

ServiceNow’s performance didn’t occur in isolation. Snowflake (SNOW), fresh off Thursday’s 36% surge to record highs following quarterly results, tacked on another 4.5% Friday.

Oracle (ORCL) vaulted 8% higher, Atlassian (TEAM) rocketed 11%, GitLab (GTLB) advanced 7.5%, and monday.com (MNDY) rose 6%. Microsoft (MSFT) inched up 3.7% in anticipation of next week’s Build 2026 conference, where fresh AI model announcements are anticipated.

Cybersecurity equities participated in the rally as well. Rubrik (RBRK) surged nearly 9%, CrowdStrike (CRWD) climbed 7.5%, Palo Alto Networks (PANW) appreciated 6.3%, and Fortinet (FTNT) gained 4%.

Company leadership also established a long-range revenue objective of $30 billion by 2030, providing investors with enhanced visibility into the company’s AI-driven growth trajectory.

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