ServiceNow CEO says AI is reorienting the global economy

Core Insights - AI is fundamentally reshaping the global economy, impacting both consumers and companies, as stated by Bill McDermott, CEO of ServiceNow [1][2] - The current AI spending boom is significant, with trillions being invested in AI infrastructure, although many digital transformation projects are failing to deliver returns [10] Company Developments - ServiceNow is experiencing a surge in demand for its AI-powered offerings, leading to a strong third-quarter performance with subscription revenue of $3.3 billion, a 22% year-over-year increase [15] - The company has raised its full-year guidance for subscription revenue, operating margin, and free cash flow, reflecting confidence in its AI capabilities [15][16] - ServiceNow is actively hiring in areas such as sales, technology architecture, and engineering to support its AI initiatives and is also focusing on re-skilling existing employees [4][5] Market Trends - The rise of generative AI poses a potential threat to the software industry, with concerns that companies may develop their own software instead of purchasing from vendors like ServiceNow [11] - Despite these concerns, McDermott asserts that ServiceNow's long-established platform cannot be easily replicated by customers [12][14] Product Innovations - ServiceNow's AI products, including Now Assist and Workflow Data Fabric, have shown strong uptake among both new and existing customers, with 103 deals exceeding $1 million in net new annual contract value [16] - The company is also investing in AI innovations and partnerships, enhancing its integration of AI into enterprise workflows [17]