ServiceNow NYSE:NOW rose 2.3% Monday after BTIG said channel checks point to a meaningful shift in the company's AI narrative ahead of fiscal Q2 results.
BTIG analyst Allan Verkhovski kept a Buy rating and $150 price target, saying ServiceNow is benefiting from early renewals and customers accepting double-digit price uplifts when moving to new tiers that bundle AI capabilities. He said the shift is not a forced migration, but checks suggest the transition is gaining traction.
The firm also said ServiceNow appears more focused on larger enterprise customers than the downmarket. BTIG expects the company to beat expectations across the board after Q1 was modestly hurt by Middle East on-premise deal disruption.
U.S. federal demand was described as strong, while Moveworks was cited several times as seeing very strong demand. BTIG said the second half will be important for measuring broader customer reaction to the new bundles.