Salesforce Inc. (NYSE:CRM) and ServiceNow Inc. (NYSE:NOW) could face growing pressure on one of enterprise software’s most lucrative business models as AI agents reduce the need for human software users, according to Parnassus Investments Chief Investment Officer Todd Ahlsten.
"The seat license model is just going to be under a lot of pressure," Ahlsten said Monday on Bloomberg Tech, pointing to the rapid growth of Anthropic, OpenAI and Google’s Gemini.
His argument is simple: if AI allows companies to get more work done without adding employees, they may no longer need to keep adding Salesforce or ServiceNow licenses alongside headcount.
“We wish them well. They’re good companies,” Ahlsten said. “I just think the long-term bankability of that is going to be challenging.”
Why Headcount May No Longer Drive Software Revenue
Ahlsten’s concern is that AI could weaken the link between customer headcount and software revenue. Traditionally, companies hired more workers, those workers needed more software accounts, and vendors collected more recurring revenue.
AI agents change that equation because companies can increase output without hiring another employee who needs another software license.
Consulting firm Bain & Company analyzed more than 30 SaaS vendors introducing generative AI and found about 65% had adopted hybrid pricing, layering AI usage or feature-based charges on top of traditional seat pricing.
That does not mean seat-based pricing is disappearing. But it supports Ahlsten’s argument that software companies may have to rely less on customer headcount growth to drive revenue.
What the CEOs Say
Both companies are already adapting, adding usage-based AI pricing alongside traditional per-user licenses. That gives them another way to grow revenue if customers start adding AI agents instead of employees.
Salesforce CEO Marc Benioff has said the company kept its engineering workforce at about 15,000 for roughly two years while AI helped those engineers get more done.
That is the kind of change Ahlsten is warning about: if Salesforce customers can grow without hiring as many people, they may also need fewer new software seats.
Salesforce argues AI can create new revenue in other ways.
On its May earnings call, the company said its Sales and Service products were still seeing year-over-year seat growth. It also said its 10 customers making the heaviest use of its AI agents increased their total Salesforce spending by 1.5 times over the previous year.
ServiceNow CEO Bill McDermott told the Wall Street Journal that roughly half of net new business revenue now comes from non-seat-based models.
For investors, the key question is whether revenue from AI agents and digital workers can grow fast enough to offset any decline in demand for human seats.
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