ServiceNow Launches AI Passport and EmployeeWorks Platform, Stock Swings Sharply on Debut Day

ServiceNow on Thursday introduced the third generation of its employee-centric AI platform alongside major updates to ServiceNow EmployeeWorks, including ToolSmith, a tool that lets non-technical employees build custom AI agents tailored to their own workflows. The company also unveiled AI Passport, an Nvidia-backed governance solution that verifies the scope of first- and third-party AI agents in real time, paired with a Super Intelligence Control Tower that expands shadow AI detection and adds AI Cost Management capabilities. AI Passport is expected to become generally available in the fourth quarter of 2026.

The product announcements initially propelled ServiceNow shares up 5.33% on Friday, reflecting investor enthusiasm over what analysts at 24/7 Wall Street described as a milestone AI business few enterprise software companies reach quickly. Piper Sandler responded by raising its price target on the stock to $175 from $140, maintaining an Overweight rating, citing the AI growth opportunity.

The gains did not hold. A broader selloff in AI-linked enterprise software stocks erased the advance and left ServiceNow down roughly 5% on the day, in line with declines at Palantir and ahead of a 4% slide in Salesforce, as concerns over AI financing weighed on the sector. MarketWatch noted that ServiceNow underperformed its competitors by the close of trading Friday. The company is scheduled to report third-quarter 2026 financial results on October 28, which will be the next test of whether its AI product momentum is translating into accelerating revenue.