Why ServiceNow Stock Plunged 36% in the First Half of the Year

ServiceNow stock dropped 36% in the first half of 2026 due to market concerns about agentic AI's impact on SaaS companies. However, ServiceNow has launched its Control Tower product to manage AI agents and continues reporting strong 22% year-over-year subscription revenue growth. While the stock trades at a 64 P/E ratio—lower than historical levels—it remains expensive but could serve as a defensive play in the evolving AI landscape.