CNBC’s Jim Cramer called KeyBanc’s call to sell ServiceNow stock a “radical move.” KeyBank analyst Jackson Ader downgraded ServiceNow from a hold-equivalent sector weight to an underweight sell. Ardar set a price target of $775, about the same level as the stock traded on Monday, when the stock fell more than 11%. “This is one of the most controversial calls I’ve ever seen,” Jim Cramer said on “Squawk on the Street,” adding that it was a challenge to ServiceNow CEO Bill McDermott. With all due respect to Adar’s quality work, “Bill McDermott could never be left out.” “ServiceNow’s own AI products have a hybrid monetization structure built in that should alleviate some of the headwinds from seat pressure, but other SaaS (software as a service) subsectors cannot survive once this story befalls them,” Adar wrote in a note to clients on Sunday. This “AI is eating software” narrative, first introduced by Melius Research in August, particularly challenges Investing Club, which owns Salesforce. The company has struggled to convince investors that its Agentic AI platform, Agentforce, won’t have a negative impact on Per Seat’s core business of customer relationship management software. Agent AI like Agentforce helps clients reduce headcount by automating problem-solving functions that previously could only be performed by humans. However, this dynamic is considered detrimental to the SaaS model because the fewer employees a customer company has, the fewer software licenses it needs. In a “Mad Money” interview earlier this month, Salesforce CEO Marc Benioff told Cramer that AI is a “commodity capability” that powers enterprise software. After making a bold move to AI-powered customer relationship management software to compete with Salesforce earlier this year, ServiceNow is now facing the same hurdles in its core business of helping IT departments manage devices and workflows. “There are signs in IT back-office employment data that make an ‘end of SaaS’ story more likely for ServiceNow in 2026,” Adar wrote. Although ServiceNow’s stock price has fallen about 27% since the beginning of the year, Jim reiterated that he still won’t bet on McDermott.
