ServiceNow initiated with a Buy at Needham on Generative AI opportunity

Needham analyst Mike Cikos initiated coverage of ServiceNow with a Buy rating and $660 price target. The company’s extensible platform drives a high rate of innovation in solving new use-cases for customers, which is evident in the projected 2025 total addressable market of $220B, the analyst tells investors in a research note. The firm adds that Generative AI accelerates both the need and use-cases for ServiceNow, and the company’s strong positioning with CIOs and its portfolio suite can sustain Subscription Revenue growth in excess of 20% with free cash flow margin moving higher from 30% today.