Why ServiceNow Stock Topped the Market on Thursday
Key Points
This will focus on advancing AI projects for clients.
The financial details of this expanded relationship weren't divulged.
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Investors clearly felt some urgency to own ServiceNow (NYSE: NOW) now, and not later, on Thursday. They were reacting to the enterprise software developer's announcement that it had expanded its collaboration with an important overseas business partner. The company's stock closed 2% higher, easily beating the S&P 500 index's 0.1% bump.
Making AI deployment easier
That morning, ServiceNow announced it had broadened the scope of its partnership with India-based peer Tech Mahindra. This is in a hot area of tech, too, specifically artificial intelligence (AI). The two companies will offer services to move clients from experimental AI pilot projects to full-scale operational deployments within their businesses.
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ServiceNow and Tech Mahindra will work with those clients in a number of ways, the American company wrote in a press release, through all stages of this transformation.
In that release, ServiceNow quoted CEO Bill McDermott as saying that "AI only matters when it creates value for people. Tech Mahindra is already turning that vision into business results. With the ServiceNow AI Platform, they're driving significant cost benefits, elevating experiences for 150,000 employees, and optimizing first-level IT support by [roughly] 25%."
The appeal of new technology
Market players notice whenever a vendor leaning hard into AI expands its reach with services related to the technology, so this is a big check mark in ServiceNow's favor.
The company didn't provide any financial details of the expanded arrangement with Tech Mahindra. That's almost beside the point, as ServiceNow's deepening partnership with a major systems integrator in a huge market is sure to be beneficial.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ServiceNow. The Motley Fool has a disclosure policy.
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