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This AI Control Tower Shopping Spree Is Either Brilliant or a Red Flag
Big-ticket acquisitions can widen the moat fast. They can also turn a clean SaaS story into an integration slog.
Noah Zelvis
December 31, 2025
This is a classic crossroads for a platform stock: keep compounding the core, or buy your way into the next arena before competitors lock it up.
The market usually likes the ambition, right up until it has to price the execution risk.
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What Just Happened
ServiceNow Inc (NYSE: NOW) has been on a 2025 deal blitz, capped by a headline-grabbing agreement to buy Armis for $7.75 billion in cash (expected to close in the second half of 2026).
The pitch is straightforward: add cyber exposure management to the workflow engine and become an “AI control tower” for the modern enterprise stack.
This isn’t an isolated swing. Earlier in the year it signed a deal to buy Moveworks (an employee-facing AI assistant and enterprise search product) to strengthen the front-end agent layer.
And in December, it announced an acquisition of Veza, pushing deeper into identity security.
The stock’s reaction has been mixed, which makes sense. Investors like platform expansion. They also get nervous when a “rule-of-40-ish” story starts to look like a roll-up.
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The Business
At its core, this is a workflow operating system for large organizations. It sells a subscription platform that helps companies route work across IT, employee service, customer service, operations, and more.
The magic is not that it does one thing better than everyone else. It’s that it becomes the system that connects a lot of messy enterprise processes into something automated, auditable, and increasingly AI-assisted.
That model is why the company earns a premium multiple when confidence is high: recurring revenue, high retention, expansion inside accounts, and a long runway of more modules, more seats, more use cases.
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Why The Deal Spree Makes Strategic Sense
The bullish version is simple: in an agentic AI world, workflows do not just route tickets. They trigger actions across systems.
The more surface area the platform controls, the more it can orchestrate.
1) Security becomes a workflow problem
If enterprises are running fleets of devices, apps, and AI agents, security stops being a point solution and starts being continuous exposure management plus fast remediation.
Armis brings visibility into connected assets and risk signals that can be turned into do this now actions.
2) AI needs a front door
Moveworks strengthens the employee-facing layer: ask a question, file a request, solve a problem, and let the system route work across tools behind the scenes.
That can boost adoption because users do not want another dashboard. They want outcomes.
3) Identity is the choke point
As more work becomes automated, who can access what becomes the control plane.
Veza pushes the platform deeper into identity security, which is a natural adjacency if you’re trying to own governance across the enterprise.
Put together, the company is trying to own: request → decision → action → audit, with security woven through the whole loop.
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The Setup In The Stock
The stock is down meaningfully from its highs, and it still trades like a premium software name. That creates a very specific setup:
If execution is clean, the multiple can expand again because the platform story gets bigger.
If integration drags, the market can keep the multiple tight even if revenue growth holds up.
This is why investors obsess over margin trajectory, net retention, and any hint that organic demand is slowing while the company leans harder on acquisitions.
The Good Stuff You Can Actually Point To
A coherent platform thesis
These deals are not random. They map to a clear end-state: a system that runs enterprise work and secures it as AI increases automation.
TAM expansion that isn’t hand-wavy
Security and identity are massive markets. If the company can sell those products through its installed base, it can grow faster without needing a totally new distribution engine.
Timing that fits the enterprise mood
AI adoption is real, but enterprises are also paranoid about risk, compliance, and shadow AI. A platform that promises governance plus automation will get meetings.
The Rub You Should Respect
Integration risk is not a spreadsheet line item
Big acquisitions come with culture clashes, product overlap, and customer confusion. If bundling gets sloppy, churn risk rises and sales cycles get harder.
Debt and deal optics matter at this scale
A large cash deal implies balance sheet decisions and usually some mix of debt financing. Even if the math works, the market often demands proof before rewarding it.
Security buyers can be skeptical
Security teams do not always want platform consolidation if it means weaker best-of-breed tooling. The company has to prove it can compete with specialists, not just bundle features.
What This Sets Up Over The Next 2–4 Quarters
A constructive path looks like this:
Core subscription growth stays resilient even while the company integrates new products.
Margins keep trending the right way (or at least do not deteriorate) as deal costs flow through.
Early go-to-market signals show security and identity attaching into existing accounts, not just sitting as standalone SKUs.
Management gives clearer milestones: integration timelines, cross-sell targets, and product packaging that customers actually understand.
If those boxes get checked, the market can start treating the deal spree as moat-building rather than empire-building.
What I’m Watching
Net retention and module expansion: Are customers buying more, or just renewing?
Security traction proof points: Attach rates, pipeline commentary, and reference wins.
Margin discipline: Do they keep operating leverage while absorbing integration costs?
Messaging consistency: Fewer buzzwords, more measurable progress.
How I’d Frame A Position
This is not a “sleep well” setup in the short term. It is a “prove it” setup.
Starter exposure can make sense if you want a high-quality platform at a discounted multiple versus its peak, assuming you can tolerate volatility.
Add only on evidence: Clean quarters, stable margins, and credible signs that the acquisitions are accelerating growth rather than distracting the core.
Trim if the story turns into perpetual integration: Rising costs, muddier guidance, or weakening customer expansion.
The Bottom Line
The market understands the ambition: build the enterprise control plane for workflows and security in an AI-heavy world.
The open question is execution. A deal spree can be the fastest way to widen a moat, but it is also the fastest way to introduce operational risk into a clean subscription compounding story.
If the core stays strong and the new assets convert into real cross-sell momentum, this drawdown can end up looking like a reset. If integration gets messy, the multiple can stay pinned even if revenue keeps growing.
Action Recap
✅ Starter: Small position if you want exposure to a platform rebound plus AI/security upside
✅ Add On Proof: Only after you see stable margins + strong retention + tangible cross-sell traction
⚠️ Trim On Trouble: If organic momentum softens while integration and costs keep climbing
That's our coverage for today; thanks for reading! Reply to this email with feedback or any tech stocks you want me to check out.
Best Regards,
—Noah Zelvis
Tech Stock Insider