ServiceNow lays off more employees as its shares fall 35% in under two weeks
Staff in the UK, US and India are affected as the company says it is "making necessary changes."
ServiceNow is conducting a new round of global layoffs. It is understood that employees in the UK, the US and India have been affected. The company did not say how many jobs are being cut.
"We are making necessary changes to how we are structured," ServiceNow said. "We are driving efficiencies across the business, actively investing in and hiring for AI-focused skills, and managing headcount with discipline to end 2026 where we started, as we shared earlier this year. That's how we grow sustainably and win."
The cuts come as the stock has slumped. ServiceNow shares are down more than 30% this year and have fallen 35% between Oct. 23 and Nov. 5. They dropped about 27% the day after its third-quarter report, when it guided fourth-quarter constant-currency cRPO growth of 18.5%, below the 19.8% analysts expected.
ServiceNow's latest quarterly filing shows how large the effort already is. The company recorded $87 million in employee severance and related costs in the third quarter and $167 million in the first nine months of 2026, against $24 million and $53 million a year earlier. It paid $153 million in cash in the nine months, and its severance reserve stood at $34 million on Sept. 30.
The filing describes a strategy "to optimize our workforce through AI-driven efficiencies and investment in talent in key strategic areas", with the program "expected to be substantially completed in 2026." The company recognizes termination costs "when employee notification occurs," so notifications in a new round would normally show up in fourth-quarter results.
Executives have been open about the direction. On the earnings call, CEO Bill McDermott called a smaller workforce a "gorgeous situation," saying headcount had "slightly declined." CFO Gina Mastantuono said sales operations headcount is "down significantly" while the number of quota-carrying salespeople grew by double digits, and tied the slowdown in hiring to AI efficiency gains that the company says exceed $1 billion annualized.
ServiceNow has been trimming staff since at least July, when layoffs affected "hundreds" of employees, including in Israel. The company said then that it aimed to "end 2026 where we started."
