CRM vs. NOW: Which Workflow Automation Stock Has More Upside?
The Case for ServiceNow
ServiceNow has been benefiting from the rising adoption of its workflows as enterprises scale digital operations. The platform supports automation across IT, HR, finance, procurement, legal and support, helping customers drive efficiency and reduce time to value.Momentum in large deals continues to remain strong. ServiceNow closed 89 transactions with more than $1 million in net new annual contract value (ACV), including 11 deals over $5 million. The number of customers contributing over $5 million in ACV rose to 528, up from 508 in the previous quarter. Clients spending over $20 million grew 30% year over year, signaling deeper enterprise commitment.NOW's expanding portfolio has been a key catalyst. The Core Business Suite, launched in May 2025, brings AI-native capabilities to core business functions. It connects workflows across departments and helps improve execution in areas like procurement and legal. Advancements in AI continue to expand the platform's value. In July, ServiceNow introduced Agentic Workforce Management, designed to support supervised task execution by AI agents across IT and operations. AI agents were also added to Security and Risk offerings through partnerships with Microsoft and Cisco to help accelerate threat detection and automate incident response.For the third quarter of 2025, subscription revenues are projected between $3.26 billion and $3.265 billion, suggesting year-over-year growth in the range of 20%-20.5% on a GAAP basis. At cc, subscription revenues remain flat at 19.5%. The Zacks Consensus Estimate for third-quarter subscription revenues is pegged at $3.26 billion, up 20.2% year over year, implying sustained enterprise demand.
The Case for Salesforce
Salesforce continues to see broad adoption of its platform as enterprises connect sales, service, marketing and analytics workflows under one system. CRM's Customer 360 architecture integrates core applications with real-time data and AI, helping enterprises unify engagement and scale digital operations. Acquisitions such as Informatica, Zoomin and Own Company add capabilities in data integration, content automation, and documentation intelligence.Adoption remains strong across large enterprise accounts. In the first quarter, more than half of Salesforce's top 100 deals included six or more clouds. Nearly 60% of those deals featured both Data Cloud and AI, underscoring growing demand for integrated applications with embedded intelligence. Current remaining performance obligations stood at $29.6 billion, up 12% year over year, reflecting continued investment in multi-cloud deployments.CRM's product portfolio remains a key driver. Agent force allows enterprises to deploy AI agents for task execution across sales, service, and marketing. These agents are powered by Data Cloud, which enables real-time data activation across systems. Salesforce has extended its ecosystem through integrations with Snowflake, Databricks, Google BigQuery, and Amazon Redshift to support zero-copy data access and streamline AI workflows.Salesforce expects second-quarter sales between $10.11 and $10.16 billion. It now anticipates Subscription and Support revenues to increase approximately 9.5%, up from the previously announced growth rate of 8.5% on a year-over-year basis. The Zacks Consensus Estimate for second-quarter Subscription and support revenue is pegged at $9.6 billion, up 9.6% year over year. The consensus mark for the second-quarter RPO's is pegged at $59.84 billion, up 11.8% year over year. Salesforce remains positioned to benefit from rising enterprise demand for unified AI platforms that bring together applications, automation and data on a single foundation.
Price Performance and Valuation of NOW and CRM
In the year-to-date period, NOW shares have lost 12.5% and CRM shares have declined 24.2%.
NOW and CRM Stock Performance
Image Source: Zacks Investment Research
Valuation-wise, NOW and CRM shares are currently overvalued as suggested by a Value Score of F and D, respectively.In terms of the forward 12-month Price/Sales, NOW shares are trading at 13.46X, which is higher than CRM's 5.74X.
NOW and CRM Valuation
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for NOW & CRM?
The Zacks Consensus Estimate for NOW's 2025 earnings is pegged at $16.79 per share, which has increased 1.51% over the past 30 days, indicating an a 20.62% rise year over year.
ServiceNow, Inc. Price and Consensus
ServiceNow, Inc. price-consensus-chart | ServiceNow, Inc. Quote
The Zacks Consensus Estimate for CRM's fiscal 2026 earnings is pegged at $11.30 per share, which has remained unchanged over the past 30 days, indicating an a 10.78% increase year over year.
Salesforce Inc. Price and Consensus
Salesforce Inc. price-consensus-chart | Salesforce Inc. Quote
Conclusion
Both ServiceNow and Salesforce are positioned to benefit from rising enterprise investment in AI-driven workflow automation, amid challenging macroeconomic conditions and lingering concerns related to tariffs. NOW's strong portfolio, acquisitions, and rich partner base are noteworthy compared to Salesforce, which is suffering from stiff competition and challenging macroeconomic conditions.ServiceNow, with a Zacks Rank #3 (Hold), currently has an edge over Salesforce, which has a Zacks Rank #4 (Sell).You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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