GitLab and ServiceNow: Assessing Opportunities in Enterprise Software
GitLab (GTLB) and ServiceNow (NOW) emerge as formidable contenders within the realm of enterprise software and workflow automation.
GitLab excels in optimizing software development through DevOps automation, while ServiceNow focuses on IT service management and enterprise workflow automation, facilitating operational streamlining across various organizational segments.
According to a report by Fortune Business Insight, the global workflow automation market was valued at $25.10 billion in 2025. Projections indicate a robust growth trajectory, increasing from $27.91 billion in 2026 to approximately $65.26 billion by 2034.
This translates to a compound annual growth rate (CAGR) of 11.20% during the forecast period of 2026 to 2034. Both GitLab and ServiceNow position themselves to capitalize on this accelerated growth.
The question arises: GitLab or ServiceNow— which of these enterprise software stocks demonstrates superior upside potential? Let us delve into the details.
The Case for GitLab (GTLB) Stock
GitLab is currently experiencing heightened demand for its DevSecOps platform. Its offerings— GitLab Ultimate, Dedicated, and GitLab Duo— significantly contribute to increasing customer adoption and the enhancement of existing client partnerships.
The company’s burgeoning customer base and leadership in the DevSecOps domain bolster its growth prospects. In the third quarter of fiscal 2026, the number of customers generating over $5,000 in Annual Recurring Revenue (ARR) surged to 10,475, reflecting a 10% year-over-year increase.
Simultaneously, customers exceeding $100,000 in ARR expanded to 1,405, marking a 23% increase year-over-year, showcasing GTLB’s adeptness in attracting and retaining major enterprise clients.
The company’s capacity to scale within established accounts while capturing new, larger clients highlights its potential for consistent revenue growth.
Noteworthy is GitLab’s evolving portfolio, particularly its integration of artificial intelligence into its platform. The launch of the GitLab Duo Agent platform signifies a substantial advancement.
In January 2026, GitLab unveiled the general availability of the GitLab Duo Agent platform, introducing agentic AI orchestration throughout the DevSecOps lifecycle.
This innovative platform aims to tackle the AI productivity paradox with intelligent agents, automated workflows, deep contextual understanding, and enterprise-grade governance across all deployment models.
The Case for ServiceNow (NOW) Stock
ServiceNow finds itself benefiting from the increasing adoption of its workflow solutions by enterprises navigating the waters of digital transformation. A robust and frequently updated portfolio continues to attract customers consistently.
Exiting the fourth quarter of 2025, ServiceNow reported 244 transactions exceeding $1 million in net new annual contract value (ACV), representing a remarkable year-over-year growth of nearly 40%.
The company concluded the reported quarter with 603 clients generating more than $5 million in ACV, reflecting an approximate 20% increase year-over-year.
The expansion of its portfolio remains impressive. In January 2026, ServiceNow announced a collaboration with Anthropic, embedding Claude as the default AI model across core ServiceNow workflows.
This integration enhances agentic application development, accelerates customer implementation, and boosts internal productivity through governed, enterprise-grade AI.
Additionally, ServiceNow launched Autonomous Workforce and EmployeeWorks, combining Moveworks’ conversational AI with its unified and governed workflow platform.
These new solutions enable AI specialists to autonomously manage enterprise tasks comprehensively, ensuring efficiency, security, and accountability.
Price Performance and Valuation of GTLB and NOW
Over the trailing twelve months, shares of GitLab and ServiceNow have declined by 53.7% and 43.4%, respectively. The downturn for GitLab can be linked to prevailing macroeconomic uncertainties and intensified competition within the AI-enabled DevSecOps sector.
Conversely, ServiceNow’s relatively stronger performance can be attributed to its robust AI portfolio and extensive partner network.
Nevertheless, its stock has faced challenges stemming from the U.S. government shutdown and transient gross margin pressures due to strategic data center investments and a pivot towards hyperscale offerings.
GTLB and NOW Stock Performance
From a valuation perspective, both GTLB and NOW shares are currently perceived as overvalued, with respective Value Scores of F and D.
In terms of forward twelve-month Price/Sales ratios, GitLab shares are trading at 4.13X, notably lower than ServiceNow’s 6.96X.
Earnings Estimates Comparison for GTLB & NOW
The Zacks Consensus Estimate for GitLab’s fiscal 2026 earnings stands at 89 cents per share, remaining unchanged over the past month, and signaling a year-over-year growth of 20.27%.
The Zacks Consensus Estimate for ServiceNow’s 2025 earnings is outlined at $4.13 per share, reflecting a 2.22% decline in the past month, yet indicating a year-over-year increase of 17.66%.
While both GitLab and ServiceNow possess the potential to thrive within the expanding enterprise software and workflow automation landscape, ServiceNow distinguishes itself through its wider enterprise reach, robust momentum in large-scale deals, and comprehensive AI integrations across mission-critical workflows.
Despite GitLab’s impressive growth trajectory, bolstered by its innovative AI-driven DevSecOps platform and strong partnerships, it contends with challenges emanating from softness in the U.S. public sector due to sluggish decision-making caused by the government shutdown, as well as ongoing issues in the small and medium business (SMB) segment. Moreover, competition remains a persistent concern.
Presently, ServiceNow holds a Zacks Rank #3 (Hold), positioning it as a more favorable choice compared to GitLab, which carries a Zacks Rank #4 (Sell).
Source link: Tradingview.com.
