All right! All I ask is, are we ready for GenAI to move to the application layer? Enough already with this infrastructure thing, right? Our next guest is somebody that's very special to me, Bill. You've heard this story many times. The bottom of the Nasdaq, I don't know, 2002, September, October, I forget. Nasdaq's thousand, stocks are trading at eight times multiples, not on revenue, on earnings. The world feels like it's coming to a crashing end and I'm depressed. Will I have a job? Will software be around? I meet this gentleman, Bill McDermott. Thirty-minute meeting, and I come out feeling great about feeling great about the company that you just joined, feeling great about the industry, feeling great about my job. I come back energized. I'm like, "Wow!" It's been, what, 22 years? That's right. You've had a profound influence on the industry. Thank you for everything that you've done for software- Thank you ... for SaaS, and the things that you're gonna be doing in the future, and thanks. You've been a big source of personal inspiration- Oh, thank you so much, guys. You've been a great partner. It's lovely, man. Thank you so much. Thank you. Thank you. Appreciate you, brother. Thank you. Thank you. Thank you. That's sweet. It's really sweet. Thank you so much. Gotta give credit. Now with that, with that softball, people ask me, "Why is Bill always bullish?" "Why are you always bullish? Optimism is the only free stimulus. Care to expand more? You know, I'm the guy that wrote the book, Winners Dream, and- Yes ... you know, and the opening quote is, by Robert Kennedy, and he said, "Some men see things as they are and say, 'Why?' I dream things that never were and say, 'Why not?'" And that's who I am. And when, you know, I think about my life's journey, I just keep getting lucky by working for great brands that have unlimited potential. And if you lead people with innovation, customer centricity, and absolute unbreakable will and the passion to win every single day, it's amazing what can be accomplished when enough people care, and that's pretty much the story. You taught me to dream big. That's right. I remember that, yes. And you asked me. I will not mention the name of the stock, but two thousand and seven, June twenty-ninth, you said, "What stock should I buy?" And like, I was blown away by the trust you had in me. I mentioned the name of a company that had a fruit thing, and they were releasing their first smartphone or something, and you said, "I bought it!" I said, "Oh, my God, he did it. He did it. Yeah. Now, I gotta take everything that I recommend seriously. So, tell us, where do you want ServiceNow to be in five years? What are your long-term aspirations for the company? I always focus, especially in technology, on the innovation of a company. Yesterday, as you know, we had an unbelievable Xanadu release. Mm-hmm. 350 net new innovations built into our GenAI release. Mm-hmm ... representing five million hours of engineering excellence into that one release. So innovation's at the center of everything. If there's no innovation, there is no hope in tech. Mm-hmm. We also focus on the culture. You know, I think that, it's easy to talk about culture when things are going great. When things aren't going great is when cultures are built. Mm-hmm. As you know, a few years ago, things were pretty questionable out there, and companies were laying people off like it was a sport. Mm-hmm. And we took a very distinct position on that and said, "We will not lay off anybody at ServiceNow. And while there might be some uncertainty in the horizon, once we get clear, we're gonna need all these great people 'cause we only hired tens and maybe nines, but definitely not eights and sevens, so we're gonna need them all. Mm-hmm. And I think really making ServiceNow the best-run company in the information technology industry, where we can say with pride, we take the innovation, we take the culture, and we take the way we lead the company, no matter what your position is, so seriously because we're all working for the customer and their customers, and they're gonna need us now more than ever. Every day, they need us now more than ever. And we just try to bring that sense of urgency, and we will what we want. Mm. We want to be the best, and we will it every day. Mm-hmm. That's what I want. I want ServiceNow to be the best-run business in the information technology industry. From a shareholder perspective- Mm-hmm I do have goals, and by 2030, for sure, I see ServiceNow, with the exception of the hyperscalers, as the most valuable enterprise software company in the world. That's a bold statement. That's what I believe is gonna happen, and I don't have a doubt in my mind about it. You're welcome back to the intervening years of this conference, and we're gonna see 2029 when you're back. We'll mark it. You guys remember this, okay? I'll remember this. Okay. Thank you. I'll be here. If you still have me. Yeah. Great. Bill, you talk to customers all the time. What you feel is the pulse of what they're thinking about? You know, it's already fall of this year. What are they thinking about calendar '25, budget expectations, priorities? Yeah. I think they always need to grow, and that somehow seems to get lost. Most people keep talking about expenses and productivity, but in the end, they both have to run a tight ship and keep it lean and productive, but they also have to grow. Mm-hmm. And I always try to think about what we are doing as creating that single platform, that single pane of glass that resides above fifty-five years of complexity and a total mess. When you think about the enterprise and the average person having to go in and out of seventeen different applications, it's no wonder they want to work from home. Who wants to go to that enterprise? So with ServiceNow, they go into one platform, and all that complexity disappears, and their work becomes enjoyable, becomes a pleasure. Their creative juices can flow. They can get stuff done. So I really, truly believe this is a moment in time where we have to help the companies we serve be more productive. Don't waste one-third of the worker's time doing silly season stuff. Get that productivity, get that revenue per employee metric going north, and make sure that you're not only making the worker's day more pleasurable, but you're getting much more output per worker, and you can prove it. Now, once you free that up and GenAI, and the number one use case for GenAI is process automation, then you also free yourself up to start thinking big and setting audacious goals on how you're going to grow your company, how you're going to unleash your company in new channels, in new ways, how you're going to apply the logic of process automation and data, and really giving every employee and every customer an unbelievable experience on an end-to-end basis. So we came to the market with a clear vision to be the AI platform for business transformation, and that's not a department thing. That's an enterprise thing. That's in every industry, that serves every persona, and that crosses every geography in the global economy. That's what we're doing, and you can grow, and you can be efficient, and you can drive absolutely great results for your shareholders. That's what we owe every customer. That's great. When you look at what's been going on with generative AI, it's largely... Jensen Huang was earlier today- Yeah Up on stage here. He did mention your company. I don't think he mentioned any other stuff. He talked about employee workflows, customer workflows being built on ServiceNow. So that's infrastructure. A lot of money has gone into infrastructure. When do you think GenAI moves to the application layer? First, I want to acknowledge a great leader and visionary like Jensen. You know, when I first came into ServiceNow, believe it or not, it's over five years now, the first thing we did, which wasn't even picked up by anybody because we've done this organically, we're the only enterprise software company in the world that crossed ten billion in ACV, and we didn't have to buy a dime of revenue to do it. Didn't lay anybody off and built our own pathway to the top by innovating great product after product after product. Now, when I first came in, we picked up a company called Element AI in Montreal, Canada, because we had an immediate vision for AI, and the Turing Award-winning founder had great researchers and great engineers, but no go-to-market. A lot of people forget the go-to-market. It's not a good idea to forget that, and by putting it together with ServiceNow, we were able to recode Element AI into the ServiceNow platform, and we've actually been building large language models with Jensen- Mm-hmm ... and his great NVIDIA company for that entire time. So our paint isn't wet. We're not a pretender. We actually have real product, and that's what Jensen reacts to and why he might have mentioned us on stage. He calls us the AI operating system for the enterprise, and he, along with me, believes that this platform that ServiceNow has can manifest itself in helping companies manage their processes at a record clip in terms of speed. We just announced RaptorDB. We're in the database business, by the way. We now have a data workflow platform that we think is not only state-of-the-art, but we already know it's the fastest database in the world, and it can do analytic queries faster and better than any database in the world. And we know that as the workflow automates the process, we now have the ability to look at the data from any data source, whether it's a system of record or it's a hyperscaler or it's a lake. We can grab the data as part of the transaction in the workflow, and you can have a complete knowledge graph now of your enterprise, whether it's people, process, data, or device on one platform with one clear pane of glass. And you can go into an Integration Hub, and you can see all the systems that you have in the enterprise, all the devices you have in the enterprise. In fact, yesterday, we ran one little query with one point three billion- Mm ... different devices in one of the largest companies in the world at sub-second speed. And we studied that, made some assessment on that, and can help customers navigate that kind of a complex query instantaneously... and every persona now can simply have a graph and a dashboard activated in real time on their device or on their desktop. No problem, we do it, and only ServiceNow does it. So this differentiation of innovation is what it's all about. Now, as it relates to NVIDIA and Hugging Face and building things that have never been built before, we decided to go for domain-specific LLMs, and this is also multimodal, as you know. But the idea there was to build our own, to literally automate the way IT and the whole estate around IT is run, to completely reinvent the employee experience. Who cares about payroll? It's done, okay. But how do I recruit, hire, onboard, train, certify, give you your learning journey so you're the best in the world at what you do, give you all the services so you can see whatever you need to see, your comp plan, what's happening with my long-term retirement procedures? "Hey, how am I doing on the healthcare? I have to take a leave. I have a maternity issue." Whatever it is, we do it for you, and you have a great experience. It's all on the mobile. And, by the way, there's no calling the eight hundred number. You have it all. And then, you know, when you off-board, we handle that, too. A lot of people have employees that have left their company years ago still on their data. That's a beauty. And then there's the customer and how you service the customer. A lot of people don't know this, but when you think about Customer Service Management, we blew past $1 billion. When you think about field service, customer service, you think about the integration of ServiceNow Now Assist with Copilot from Microsoft. Just picture yourself. You're in Teams, and you want to activate an action in ServiceNow. It's seamless. You don't have to jump in and out of some app or UI. It's already done at a deep engineering level. You say, "Well, how is that an advantage in Customer Service Management?" If I happen to be in ServiceNow Customer Service Management, and I want to completely compose a presentation, and perhaps it's a PowerPoint on the fly to make a sale to Goldman Sachs, I can do that instantaneously. I don't have to go into a separate app. It's all engineered together. So- Bill, you want to make a sale to Goldman Sachs? Our CEO is actually here. I would very much like that. Thank you, Goldman Sachs. You're actually an excellent customer, as is 24 out of the top 24 banks in the world. We were 23 out of 24 coming into this year. We handled that situation in the first quarter. We're now 24 out of 24. We love financial services. In fact, our new GenAI release yesterday, financial services, retail, telco, media, technology, public sector, all of these industries now are getting GenAI use cases out of the box with the best platform in the world, and it's real product, and the other thing we should talk about is Creator. Mm-hmm. A lot of people don't know this, but Creator now blew past $1 billion last year. And so you say, "Wow, you know, you mean you actually have developers now creating innovation and applications on the fly?" Yeah, but the best part is, with complex workflows and governance procedures and the development of new applications, you're doing it on that same platform. Mm. So now your CEO knows when you're an engineer, that anything you're building is in concert with the business processes and the way the workflow should be automated, and it's not a sidecar project. Like the thousands and thousands points of dim light, point solutions that are killing companies today, costing them all kinds of money, but dragging their productivity through the ground, all that goes away with ServiceNow. So the word is getting out there, and as the word gets out there, the company just continues to prosper, and that's the most important thing, getting the word out there. Mm-hmm. Bill, what's your vision for Now Assist in terms of net new ACV? It was a big increase in second quarter. Where do you see this going? Quarter over quarter, sequentially, we look at this doubling, and it has been doubling, and it's gonna continue to double because we have real product. I think the idea of Now Assist and the GenAI revolution, you know, just think about it. 3 trillion will be spent on AI by enterprises through 2027. 36% of that will be GenAI in the space that we're participating in. So we're fighting for a $1+ trillion prize. To your point, when do we move past hardware and GPU stacks and get into the app layer or the platform layer? It's now. It has started with ServiceNow, and I think ServiceNow, from what I can tell, you know, you have great companies like Microsoft- Yeah ... and NVIDIA that have prospered mightily because of- The CTO of Microsoft was sitting here yesterday. Yeah. Yes. And then... And look, I think that, you know, we have built a framework partnership with Microsoft that's unbreakable. We have great partnerships with all the hyperscalers, though. It should be mentioned. Mm-hmm. I do need to do that, because we work with AWS. We also have a partnership now with Google Cloud, and you know, it's important to give the customer choice. And so as you're talking about GenAI, just remember, our domain-specific models, they're not only products, but they run very inexpensively. Customers love that. So just think about 175 GPU versus 1 GPU in terms of the cost to run a domain-specific LLM versus a big model. Think about 0 latency, rocket fast, it's your data, and think about total security. Because, again, you're not going on any wild adventures. We're working within the framework of your corporation. Customers love that. So that's where it's at now, but there's lots of different innovation. Meta's doing a great job, Microsoft's doing a great job, Google's doing a great job, and we integrate seamlessly with all those models. In fact, lots of innovation's gonna take place where companies will build their own, and they can bring their own LLM and integrate that into ServiceNow. So this is infinite choice, no limitations, complete open architecture, and yet at the same time, very disciplined workflow automation and security across the whole enterprise. Even on security, security companies out there are very good, but some might be good in the cloud, some might be good at a firewall, others might be good at endpoint. We integrate with all of them, and then you can have a complete visibility on how they're all doing at different pieces and parts of the company in real time. So I think this idea of a control tower for digital transformation within every company is our calling card, and it's a good one, because I don't compete with anybody. I just do something that none of them do. Like Stephen Curry. That's it! I get pushback from investors, and, "Hey, this GenAI thing, you know, is it really a business use case? How are customers getting value out of it?" I know you've deployed it internally. Can you drill into one or two customers that have deployed GenAI? Sure ... with ServiceNow- Sure ... and have gotten meaningful savings that are impacting their bottom line? There's so many. Teleperformance would be an example, a USI would be an example, and it's instantaneous ROI, by the way. So this isn't like a hard business case, "Let's get the consulting team over there for a month and prove it." This is like, it's a no-brainer. You're deflecting 90% of the cases that normally had to be managed by agents. So, okay, now it's self-service. Just think about that savings. When a case does need to be managed, just think about resolving it in seconds instead of 45 minutes, and then times that by the number of cases. Think about a BT. Think about a London Stock Exchange. Think about creating experiences for the customer that are so uncommonly good that they're undeniable. So I believe that the biggest cases right now would be in managing a case, deflecting a case, closing out a case, and making sure that whether it's an employee experience or a customer experience, the time to resolution is so undeniably good that you don't need a computer to understand the business case. You could do it on the back of a napkin. Mm-hmm. That's the kind of cases we're going into the market with, and that's why customers absolutely love it. Again, you're not doubling sequentially because you don't have product. That's the, that's the key. You gotta have the product. Some would say it's Bill's salesmanship, but there's gotta be excellent product. There's gotta be, there's gotta be, you know, more than just Bill. I mean, because it's a big global economy out there, and, you know, if you're Australian government or you're the Italian government or you're the Saudi Arabian government and the Kingdom, and you're buying into ServiceNow, I can't be in all those three places at the same time. And, you know, if you're looking at the top 2,000 companies in the world, we're getting close to having 90% of them doing something with ServiceNow. And, you know, what we think, what we think has really, really added a lot of value is now we're the CEO's platform. And I think we earned our stripes with the CIO because of the outstanding platform and the notoriety it had in IT, which then evolved into the employee experience, obviously into the customer experience and to the developer community. But think about the CEOs out there. If you believe, and you should ask them, the CEOs out there have had it with company spending all kinds of money on IT, all kinds of money on applications, and in the end, they look around the boardroom and they say: "Why is it that this department can't talk to this department? Why is it that I can't have a single-threaded, end-to-end process in this company that takes my innovation from the factory and move it to the foxhole in instantaneous time? Why, why can't we do that?" Well, this system doesn't talk to that system. That data is caught in that vault, and we can't get to it. And it goes on and on and on, and that's not only in the private sector. Obviously that's in the public sector, which explains why our federal, state, and local business, particularly in the United States, blew way past $1 billion. Because they love us, and it works, and the projects are quick to implement, fast to return value on invested capital, and everybody that does business with us is referenceable and successful. And especially in public sector, they don't want to take chances with these huge programs that used to cost billions and billions, and now instead, they can do it for millions and install it, get it referenceable, and make it a showcase... in weeks, sometimes months, but not years. Bill, you talked about the savings from call deflection and whatnot. As you talk to your customers getting these savings from generative AI, are they saying, "Okay, I don't need to hire as many people, because this thing is saving me money"? Are they saying, "I don't wanna plant the other thing..." But how are they looking at it? Are they looking to cut costs, cut down employment? Yeah. Your broader thoughts, therefore, what does this mean for the employment market in customer support? Yeah ... sales, marketing? Is AI gonna take away our jobs? I'm gonna give you two ways of looking at it. Yeah. So first, let's talk about a CEO. There's this CEO. Really great conversation. He has done roll-ups and dominated in the insurance industry. I asked him the same question. Dominated! Incredible. And he told me that he doesn't just want his people to have a great experience, but he wants to do so much more with less, meaning in the event the revenue doesn't go into a hockey stick, he's got to get the productivity out of the headcount that he already has, and he needs technology to wring that value out of each and every employee that he has in the company. So there's definitely a focus on the productivity. On the other hand, he's going to the M&A card and growing very fast because of the M&A, and he's acutely aware of the fact that the value of his company is based on how fast it grows. So he wants to use technology to move the top line. It's not about reducing headcount, it's about leveraging the headcount you already have. You know, in tech, there's many more jobs available than people to fill them. Nobody ever talks about that. Mm. Millions of jobs available. Really? ... that aren't getting filled. Yes! Mm. And so it's a renaissance of technology that's going on in the world, because every company needs to be a tech company. In fact, I think every company needs to be a software company, which is why I think the ServiceNow platform needs to be a standard in every company in the world. The other thing about what people don't know, they're genuinely afraid of. So if you think about Time Magazine in 1966, they ran a big story that computers were going to take away 90% of the jobs in the global economy, that the only people that would actually be employed were high-level managers, and the governments would have to subsidize the other 90%. Their jobs would be gone, and society would have to carry them 'cause computers were gonna do everything. Now, I think there's, like, hundreds of millions of jobs that have been created on tech since then, and obviously, that never came to fruition. I believe, and I sincerely believe this, that AI is the wellspring of opportunity in the global economy. There are researchers that independently have said it'll have an $11 trillion impact on the economy in the next handful of years. I believe that is maybe true. Maybe it's ten, maybe it's nine, maybe it's eight, but it's gonna be big, and the reason for that is there is so much inefficiency, there is so much waste, there is so much human potential that can be activated- Mm ... by taking the soul-crushing work- Mm ... away from people and unleashing them to do things that really matter, that can help companies grow and prosper, and that has never been factored into the equation as people think about technology on a day-to-day basis. That's why we're working so hard at telling the story. That's great. Powerful. Tell us about your partnership with Microsoft, the Now Assist working with Microsoft Copilot, and also, if you can, how is the Microsoft Copilot thing going for ServiceNow internally? Yeah. We have a great partnership with Microsoft, you know, as I mentioned earlier. If you think about what I said, you know, Copilot and Now Assist are two excellent, excellent GenAI use cases for customers to consider, but they do very different things. And if you think about knowledge work and Office 365 and Teams and Dynamics. By the way, we use Dynamics at ServiceNow. These are all very important things, but they don't do what we do. So let me just give you an example. If you're in Teams, and you're doing your day-to-day job, and let's just say, for example, you happen to be in the HR or the technology department, and you need to order some new gear for a home office or get a computer delivered to your office 'cause the one that you're using is broken, Microsoft can do a lot of things, but they can't do that. So Now Assist will be assisting you in getting you the form factor configuration that management signed off on at the price that you agreed to in your procurement schedule, and it'll go grab what you need in the form that you need it, at the price you bargained for, and deliver it to the address you wanted, and it'll be done automatically, instantaneously, and the thing that's gonna really be interesting... So you see, you could see how that's gonna work for you, but the thing that's gonna be really interesting are these AI agents. Hang with me on this. We see an enormous world of AI agents. Now, the thing that's gonna happen in the enterprise with AI agents is they are going to work 24 hours a day... seven days a week, three hundred and sixty-five days a year. We don't have to get them on any kind of healthcare plan. We don't really worry about them. We're just gonna grind and grind and grind, and they're gonna do a lot of the hard stuff. But they're gonna be working with people, not just for people, and they're gonna be able to think, not just act. They're gonna be pretty smart, maybe even as smart, if not smarter than humans. Certainly, in certain ways, they will. This is happening now. You saw the Xanadu release. If you haven't, we got AI agents. Now, this is our competitive advantage. Others will have them, too, but they will have them in their domain. They'll be very specialized, and they'll do specialized things, which is fine. Let it happen. But what platform on an end-to-end basis is gonna corral all these agents that are running around, where you have some real symmetry with your strategy on an end-to-end basis, where the finance agents work well with the sales agents who understand the engineering agents, and now you've got an organization that's under control, and you have processes that are integrated, and the agents are a plus-up, and they're secure? What happens if the agents aren't governed and there isn't a platform structure around them? You might optimize for one department, but you're not gonna optimize for the entity, the corporation, and that's what's happened for the last fifty-five years. Everybody gets to do their own thing. They self-optimize for their department, and the CEO sits back and wonders why I can't execute a clear vision across the enterprise on an end-to-end basis with immediacy, well, everything is trapped in a silo. We took down the walls, and now you can have your agents. We're not competing with other people's agents, that's good, but we'll integrate those agents into workflow automation across the enterprise in a coherent way, so you run a great company. That's gonna be the big, big frontier. Next year, when you come back, everybody will have an agent. Yes. So you can actually ask the agent to take notes, and you can actually listen and enjoy the conference. So on that note, Bill, it's great to have you with us. Thank you. We hope you come back again next year. I would love to, Kash. And the year after, and the year after. Thank you. Thank Thank you all very much. Let's give a round of applause. Thank you, Kash. Thank you!