Salesforce drops after ServiceNow earnings hit sector

Salesforce Inc shares fell 4.0% in morning trading on Thursday after enterprise software company ServiceNow reported quarterly results that raised concerns about software spending across the sector.

The stock reached a session low of $225.04 before recovering partially to $232.34.

ServiceNow exceeded revenue expectations for the third quarter of 2026 but missed on adjusted earnings per share. The company also projected a slowdown in its current remaining performance obligations, which represents contracted revenue expected to be recognized over the next 12 months. ServiceNow guided for 18.5% growth in the fourth quarter, down from 21% in the third quarter.

Investors interpreted the guidance as a warning signal about enterprise AI adoption and software spending trends, which affected other companies in the sector including Salesforce.

The selloff extended to Salesforce as investors drew comparisons between the two companies. Concerns emerged about Salesforce's ability to accelerate growth through its Agentforce AI platform and its pending $5.66 billion acquisition of Braze.

An analyst note published on Thursday also pointed to Salesforce's average billings growth of 11.2% over the past year and anticipated sales growth of around 10.4% for the next year.

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