ServiceNow Lines Up $4bn Bond Sale to Refinance Armis Acquisition Debt
ServiceNow is looking to raise approximately $4bn through a US high-grade bond sale, according to Bloomberg, to refinance debt taken on for its acquisition of cybersecurity firm Armis Security in 2025. The move aims to replace a $4bn unsecured term loan that matures on October 16, 2026.
JPMorgan Chase, Wells Fargo, Barclays, and Citigroup are organizing investor calls ahead of the issuance. This refinancing strategy is common for companies looking to fund acquisitions and AI-related spending, as ServiceNow has been rapidly growing its AI product revenue. The company’s Now Assist AI platform is projected to reach $1.5bn in annual contract value by year-end, with AI products expected to account for more than 30% of total recurring revenue by 2030, according to analyst estimates.
The bond sale offers several advantages: it reduces ServiceNow’s interest expenses, extends its maturity profile, and frees up bank facility capacity. However, details such as tranching, indicative spreads, and targeted average tenor remain undisclosed.
ServiceNow completed the Armis acquisition earlier this year, integrating the cybersecurity firm’s expertise in connected devices and operational technology systems into its workflow-automation platform, expanding its reach into the security operations market.
Q1 2026 results showed a 22% year-over-year revenue increase for ServiceNow, with subscription revenue surpassing expectations. The company has been providing updates on the integration of Armis and the early adoption of agentic AI features within its core platform during recent quarterly reports.
ServiceNow has maintained a disciplined approach to debt, keeping total debt modest relative to free cash flow, and maintaining investment-grade ratings well above the BBB threshold. The bond refinancing marks the permanent financing step for the Armis acquisition, which was ServiceNow’s first deal at scale requiring a term loan facility.
Pricing for the new bond is expected later this week, with reports suggesting a multi-tranche deal spanning short- to long-term tenors.