ServiceNow shares dropped 2.66% on July 9 as Starbucks revealed plans to develop proprietary AI tools to replace vendor software, dampening SaaS valuations. The stock has tumbled 36% in H1 despite continued double-digit revenue growth and management’s projections for sustained high expansion through year-end.
On July 9, ServiceNow shares fell 2.66% after Starbucks announced it will build in-house AI tools to supplant existing vendor software, triggering a sell-off across enterprise software names. The move highlighted customer willingness to internalize AI development and challenged reliance on third-party SaaS platforms.
ServiceNow’s stock has declined 36% since January, marking one of the steepest H1 drops among large-cap SaaS providers this year. Market rotation away from high-multiple software names and concerns over AI competition have weighed heavily on its valuation.
Despite the share slump, ServiceNow reported double-digit year-over-year revenue growth in its latest quarter and management reiterated guidance for sustained high growth through year-end. Executives pointed to expanding AI-driven workflow offerings and new enterprise deals as key drivers of future performance.
