Why ServiceNow Stock Dropped 20% in June

(NYSE: NOW) stock fell 20% in June, according to data provided by S&P Global Market Intelligence. It's been fairly volatile as the market weighs the impact of artificial intelligence (AI) on its business and how it should be valued today, and the drop was on the heels of a 41% rebound in May.

As a category, software-as-a-service (SaaS) stocks have been falling as the market recognizes that agentic AI can be used to accomplish many of the tasks they're used for for free or more inexpensively. The idea behind SaaS is that clients pay a monthly fee for services that include upgrades and customer support, but if developers can create AI agents that take care of the same work, the SaaS products can become obsolete.

Source Fool.com