ServiceNow's AI Control Tower Drives Enterprise Adoption and Revenue Growth
ServiceNow is attributing strong Q3 2025 results to demand for its AI governance capabilities, particularly the AI Control Tower, which addresses enterprise concerns about managing AI risks and compliance.
Governance Tools Propel Business Performance
During its Q3 2025 earnings call on Wednesday, ServiceNow pointed to AI governance features as a key driver of customer adoption and financial results. The company surpassed its profitability guidance for the quarter ending September 30 and raised its full-year outlook. AI products are tracking toward more than half a billion dollars in annual contract value for the year, with deal volume for the AI Control Tower—introduced in May—more than quadrupling sequentially in the third quarter.
Amit Zavery, president, chief operating and product officer, explained the market appetite for governance solutions: "The AI Control Tower [has] been one of the biggest interests from any customer we speak to because every customer, when they're thinking of AI adoption and agentic, they're worried about control. They don't know how to manage the security. They don't know what to do with trust, safety, regulatory requirements. As soon as we start talking to customers, it resonates instantly."
Governance as Competitive Advantage
Enterprise organizations recognize the promise of AI for operational improvements but remain cautious about associated risks. Vendors that offer tools to mitigate those risks and provide visibility into AI systems are helping CIOs navigate deployment challenges. Companies are increasing their spending on risk management as they work to close the gap between AI investment and measurable returns. Ignoring potential pitfalls in favor of rapid rollout is not a realistic strategy—the vast majority of organizations have already experienced some financial consequences from AI-related risks.
ServiceNow positions its governance approach as a differentiator amid intense competition in the AI vendor market. Chairman and CEO Bill McDermott remarked during the call: "This AI sprawl that's gone on right now, whether it's built in-house proof of concepts or externally sourced dreams that haven't quite worked out, are really getting cleaned up by the AI Control Tower in this platform. Having a single governance framework is absolutely a breakthrough for enterprises."
Competitors have also expanded their governance offerings recently. IBM rolled out a tool in June designed to secure AI models, data and usage. Salesforce enhanced observability capabilities in its Agentforce platform during the same month.
Governance takes on heightened significance as enterprises expand their use of AI agents. ServiceNow reported that consumption of its Now Assist AI agent has grown more than 55 times since the end of May.
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