ServiceNow plans a $4 billion bond sale to refinance the debt from its Armis acquisition.
ServiceNow plans to raise around $4 billion through a US high-grade bond sale to refinance debt incurred from its acquisition of cybersecurity company Armis Security, according to a Bloomberg report on Monday.
JPMorgan Chase, Wells Fargo, Barclays, and Citigroup held investor calls on Monday in anticipation of the bond issuance. This trade will replace a $4 billion unsecured term loan that ServiceNow took out in 2025 to finance the $7.75 billion acquisition of Armis, which is due to mature on October 16, 2026.
The bond sale continues a trend of high-grade enterprise software companies utilizing the dollar bond market for funding acquisitions and investments in AI infrastructure. ServiceNow has been rapidly increasing revenue from its AI products, with its Now Assist AI platform expected to generate over $1.5 billion in annual contract value by the end of the year. Analysts predict that AI-related offerings will represent more than 30% of total recurring revenue by 2030.
The refinancing transaction is traditional in nature. Substituting a short-term loan with long-term bond issuance will help reduce ServiceNow's interest expenses, extend its maturity profile, and increase bank-funding capacity. ServiceNow has not revealed details on the tranching of the new issuance, the indicative spreads, or the anticipated average tenor.
ServiceNow completed the acquisition of Armis earlier this year. Armis focuses on cybersecurity for connected devices and operational technology systems, with the deal seen as complementary to ServiceNow’s wider workflow automation platform and as a means for expanding into the security operations market.
In its Q1 2026 results, ServiceNow reported a 22% year-on-year revenue increase, with subscription revenue surpassing analyst expectations. The company has utilized recent quarterly updates to inform investors about the integration of Armis and the early adoption of AI features within its core platform.
Among software sector issuers, ServiceNow has demonstrated disciplined debt management. Its total debt is relatively low compared to free cash flow, and the company retains investment-grade ratings well above the BBB threshold.
The Armis acquisition was the first significant deal that required a term-loan facility, and the bond refinancing represents the planned step towards permanent financing.
Pricing for the new bond is anticipated later this week. Although ServiceNow has not disclosed specific maturity segments, it is reportedly promoting a multi-tranche deal that covers short to long-dated tenors. The company has not provided additional comments on the bond sale beyond standard disclosures.
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ServiceNow plans a $4 billion bond sale to refinance the debt from its Armis acquisition.
ServiceNow aims to secure $4 billion through a US high-grade bond sale to refinance the term loan used for its $7.75 billion acquisition of Armis Security.