TLDR
- ServiceNow and OpenAI entered a three-year partnership to integrate AI models into ServiceNow’s enterprise software platform.
- The deal includes revenue commitments based on customer usage, with payments tied to how often clients use OpenAI’s technology.
- AI agents will handle real tasks like restarting systems and managing IT issues, going beyond simple chatbot functionality.
- NOW shares fell 2.94% Friday but rebounded over 2% in premarket trading after news of the partnership broke.
- ServiceNow will report full-year earnings on January 28, with analysts maintaining a Strong Buy rating.
ServiceNow has signed a three-year deal with OpenAI to embed artificial intelligence models directly into its business software. The partnership allows ServiceNow customers to deploy AI agents that perform tasks autonomously rather than just provide recommendations.
The agreement covers IT support, customer service, and operational workflows. Companies using ServiceNow will access OpenAI’s technology through their existing systems.
Brad Lightcap, OpenAI’s chief operating officer, said enterprises want OpenAI intelligence applied directly into ServiceNow workflows. He noted customers are seeking AI that functions like a true teammate inside the platform.
The deal involves a revenue commitment from ServiceNow to OpenAI. Neither company disclosed financial details. Payment amounts depend on actual customer usage of OpenAI models within ServiceNow products.
How the Technology Works
The AI agents differ from traditional chatbots by taking direct action. ServiceNow will build AI voice agents for customer support using OpenAI’s speech-focused models.
The company will integrate OpenAI’s computer-use model as well. This technology allows AI agents to operate systems independently.
Tasks include restarting computers and resolving basic IT problems. Amit Zavery, ServiceNow’s president and chief product officer, said the models help companies interact with legacy systems like mainframes.
The AI learns system operations and integrates results into ServiceNow workflows. This approach eliminates the need for ServiceNow to develop large language models internally.
Stock Performance and Market Context
NOW shares closed at $127.31 on Friday, down 2.94%. The stock climbed over 2% in premarket trading Tuesday following the Wall Street Journal’s report on the partnership.
Enterprise AI competition is intensifying. Salesforce has integrated AI agents into sales and marketing platforms.
SAP and Workday are deploying similar technology in finance and HR software. OpenAI faces competition from Anthropic, Alphabet, and Microsoft in the enterprise market.
Microsoft offers AI tools throughout its business software suite. Alphabet continues expanding AI capabilities in cloud services.
ServiceNow posted 22% revenue growth in Q3. The increase came from higher AI adoption, particularly in customer service applications.
Looking Ahead
The company schedules its full-year earnings report for January 28. Thirty-two analysts give ServiceNow a Strong Buy consensus rating.
The average price target sits at $221.14. This represents a 75.06% upside from current levels.
The OpenAI partnership positions ServiceNow to compete in the growing enterprise AI market. Companies want AI that performs work autonomously rather than requiring constant human oversight.
ServiceNow customers will access these capabilities through familiar workflows. The integration aims to make AI adoption seamless for existing users.
