ServiceNow Makes a $7.75B Cybersecurity Move as AI Raises the Cost of Getting Hacked

Cybersecurity has long been treated as a necessary expense rather than a strategic advantage. Companies bought protection, hoped nothing went wrong, and focused their attention on growth initiatives instead. As artificial intelligence spreads deeper into corporate systems, that approach is becoming harder to justify.

On Tuesday, ServiceNow (-.4%) said it will acquire cybersecurity company Armis in a $7.75 billion cash-and-debt deal expected to close in the second half of next year. The move highlights how AI is changing not just how companies operate, but how they think about risk.

AI tools are now embedded across many parts of the enterprise, from customer service and logistics to finance and software development. These systems rely on constant data flows and interconnected devices. While that connectivity improves efficiency, it also increases the number of places where something can go wrong.

That is where Armis comes in. The company focuses on cyber exposure management, helping businesses identify and secure internet-connected devices across cloud environments, operational technology, and legacy systems. Many of these assets were never designed with modern cybersecurity threats in mind, yet they now play a central role in AI-powered operations.

ServiceNow says integrating Armis into its platform allows customers to move from reactive security responses to continuous monitoring. Instead of responding after a breach or outage occurs, companies can identify vulnerabilities earlier and address them as part of daily operations.

The acquisition also represents a shift for Armis, which had been building toward independence. The company raised $435 million last month at a $6.1 billion valuation and had discussed a potential IPO in 2026 or 2027. Selling now provides immediate scale and access to ServiceNow’s large enterprise customer base, avoiding the uncertainty that still surrounds public listings.

From a financial perspective, Armis brings meaningful momentum. The company generates more than $340 million in annual recurring revenue and is growing roughly 50% year over year. That growth stands out in a software market where many companies are seeing slower demand.

For ServiceNow, the deal expands its total addressable market for security and risk management while adding revenue that can be scaled across its existing platform. It also reflects that cybersecurity spending has remained resilient even as companies rein in other technology budgets.

Investors will be watching closely to see how ServiceNow integrates Armis and whether the acquisition drives sustained growth. But the message is this: as AI adoption accelerates, cybersecurity is no longer a side consideration. It has become a core part of how businesses protect their operations, data, and customers. And ServiceNow’s new acquisition shows where its priorities lie.

At the time of publishing this article, Stocks.News doesn’t hold positions in companies mentioned in the article.