Two companies are uniquely positioned to capitalize on this opportunity. UiPath(NYSE: PATH) and ServiceNow(NYSE: NOW) both have tools that let companies create and manage AI agents, and both have solid foundations of growing annual recurring revenues.<\/p>\n
Missed Nvidia in 2009? This Rare Signal Is Flashing Again.In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1\/100th the size of Nvidia. Continue \u00bb<\/a><\/p>\n While both companies have similar opportunities in front of them, if you want to choose just one of them to invest in, here are a few details to consider.<\/p>\n Image source: Getty Images.<\/p>\n ServiceNow has higher annual recurring revenue growth rates<\/p>\n Annual recurring revenue<\/a> is a critical metric for both companies. It indicates baseline growth and suggests how growth may change in the future.<\/p>\n ServiceNow is the larger company and is also growing faster. The company has $12.64 billion in current remaining performance obligations<\/a> compared to UiPath’s $1.9 billion in annual recurring revenue at the end of its fiscal 2027 first quarter.<\/p>\n ServiceNow is also growing its recurring revenue stream faster. It achieved a 22% year-over-year growth rate for subscription revenue in the first quarter. UiPath only managed a 12% year-over-year growth rate for its subscriptions, but its overall revenue was up by 17%.<\/p>\n Almost 9,000 global customers trust ServiceNow, and that includes 85% of the Fortune 500. Those businesses have more financial flexibility to pay more for ServiceNow plans in the future. UiPath has over 10,000 customers, but ServiceNow can charge a premium for its platform.<\/p>\n For instance, ServiceNow has 630 customers that are spending more than $5 million per year with it, while UiPath only has 374 customers paying more than $1 million per year for its platform.<\/p>\n UiPath has a better shot at boosting margins and improving its valuation<\/p>\n Although ServiceNow has a higher revenue growth rate, UiPath is well positioned to boost its margins. When discussing UiPath’s fiscal 2027 first-quarter results, CFO Ashim Gupta noted that it was the first time the company had achieved GAAP profitability<\/a> in a Q1.<\/p>\n UiPath is now in a position to continue scaling without soaring operating expenses. While costs should continue to rise over time, the company’s revenue growth could outpace spending growth in future quarters.<\/p>\n ServiceNow has been profitable for much longer and commands double-digit net profit margins. In its latest quarter, UiPath had a net profit margin just above 5%.<\/p>\n UiPath would have to more than double its profit margin to reach ServiceNow’s level. Since these agentic AI platforms have similar client lists and serve similar markets, it is feasible for UiPath to achieve that net profit margin in the future.<\/p>\n ServiceNow has still been growing its top line, but its net income growth has been a bit disappointing in recent quarters. Lower net income growth limits how much more attractive ServiceNow’s price-to-earnings (P\/E) ratio<\/a> can become, while UiPath is better positioned to improve its valuation.<\/p>\n The final verdict<\/p>\n ServiceNow is growing revenues faster and has customers who are willing to pay more for its offerings. However, UiPath recently hit a profitability milestone and is in a good position to expand its margins<\/a>. Both companies trade at similar P\/E ratios, but UiPath has a better shot at making its valuation more attractive for long-term investors.<\/p>\n If ServiceNow can raise prices higher and get some of its costs under control, it can return to delivering double-digit, year-over-year net income growth. If that happens, the thesis will change significantly and favor ServiceNow.<\/p>\n Investors who are more focused on value may want to take a closer look at UiPath, but both companies are well positioned for the upcoming agentic AI boom.<\/p>\n Should you buy stock in ServiceNow right now?<\/p>\n Before you buy stock in ServiceNow, consider this:<\/p>\n The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks<\/a> for investors to buy now\u2026 and ServiceNow wasn\u2019t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.<\/p>\n Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you\u2019d have $400,964!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you\u2019d have $1,272,955!*<\/p>\n Now, it\u2019s worth noting Stock Advisor\u2019s total average return is 930% \u2014 a market-crushing outperformance compared to 210% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.<\/p>\n See the 10 stocks \u00bb<\/a><\/p>\n *Stock Advisor returns as of July 17, 2026. <\/p>\n Marc Guberti<\/a> has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ServiceNow and UiPath. The Motley Fool has a disclosure policy<\/a>.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":"Key Points ServiceNow has higher revenue growth rates and can secure more lucrative deals than UiPath. UiPath recently…\n","protected":false},"author":2,"featured_media":110086,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[179,7493,1320,1317,1316,1319,1318,1321,15039,1105,1310],"class_list":["post-110085","post","type-post","status-publish","format-standard","has-post-thumbnail","category-agentic-ai","tag-agentic-ai","tag-agentic-artificial-intelligence","tag-futures","tag-index-market-quote","tag-index-market-quotes","tag-index-market-symbol","tag-index-market-symbols","tag-indices","tag-now","tag-servicenow-inc","tag-the-globe-and-mail"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/110085","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/comments?post=110085"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/110085\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media\/110086"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media?parent=110085"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/categories?post=110085"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/tags?post=110085"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"A](\"https:\/\/barchart-news-media-prod.aws.barchart.com\/FC\/d037925b26a404c6e19ea60550b995f9\/%3Furl%3Dhttps%253a%252f%252fg.foolcdn.com%252feditorial%252fimages%252f879230%252fgettyimages-2226339419-1201x743-b29a47e.jpg%26amp%3Bw%3D700\"\/)
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