Salesforce vs. ServiceNow: Which AI-Ready Software Stock Is the Better Buy in 2026
Why AI Is Shaking Up Software Stocks
The technology sector continues to attract investors in 2026, largely due to the surge in artificial intelligence (AI) applications. However, the rise of AI also threatens traditional software business models, creating uncertainty in the market. Many software stocks have seen their share prices drop, presenting potential buying opportunities for savvy investors.
Two companies standing out in this environment are Salesforce (NYSE: CRM) and ServiceNow (NYSE: NOW). Both have adapted to AI, but which one offers the better investment opportunity?
Salesforce Tackles the AI Challenge
Salesforce is the leader in customer relationship management (CRM) software, helping businesses manage sales processes and customer interactions.
The advent of AI could disrupt Salesforce’s core business because AI agents can independently handle tasks like responding to emails, potentially reducing the need for CRM software.
To address this, Salesforce launched Agentforce in 2024, a suite of AI agents designed to enhance its platform.
Salesforce Q3 Highlights
- Revenue: $10.3 billion, up 9% year over year
- Full-year sales forecast: Raised to $41.5 billion from $37.9 billion
- Agentforce ARR growth: 330% year over year (Q3 ARR totaled $500 million)
While Agentforce revenue is still small relative to total sales, it is growing rapidly and shows how Salesforce is positioning itself for the AI era.
How ServiceNow Is Performing
ServiceNow, like Salesforce, focuses on streamlining business workflows and integrating AI to expand its addressable market.
ServiceNow Q4 Highlights
- Revenue: $3.6 billion, up 21% year over year
- 2026 subscription sales forecast: At least $15.5 billion, up from $12.9 billion in 2025
- Subscriptions: Accounted for 97% of 2025’s $13.3 billion revenue
CEO Bill McDermott emphasized that ServiceNow’s AI integration is designed to work harmoniously with workflows, creating long-term advantages rather than replacing human-driven processes.
Comparing the Two Stocks
Despite fears that AI will hurt software companies, both Salesforce and ServiceNow are showing strong growth, and their AI offerings are being adopted by customers.
- Valuation: Salesforce trades at about 15 times forward earnings, making it a more attractive value than ServiceNow, whose forward PE ratio has dropped but remains higher.
- Market leadership: Salesforce leads the CRM space, giving it an edge over ServiceNow.
For investors looking for a single stock to buy, Salesforce currently looks like the stronger choice due to its combination of growth, AI adaptation, and valuation.
Should You Buy ServiceNow?
While ServiceNow is performing well, it was not included in the Stock Advisor’s top 10 list of recommended stocks, which historically have delivered extraordinary returns. Past examples include:
- Netflix: $1,000 invested in December 2004 would be worth $443,353*
- Nvidia: $1,000 invested in April 2005 would be worth $1,155,789*
The Stock Advisor community emphasizes high-quality, high-potential picks, suggesting Salesforce is better positioned to outperform ServiceNow in the current market.
