High GRR can hide the rot
ServiceNow reported 98% Gross Revenue Retention. Workday sits at 97%. Both companies lead the public B2B SaaS market on this metric. a16z called Workday "arguably the most important and least loved product in enterprise software." Worth asking: how does a product nobody loves retain 97% of revenue?
Contract structure. Both companies default to three-year initial deals. Customers are locked in. That 97-98% GRR reflects contract terms, not product satisfaction. The revenue sticks because there is no exit clause, not because the platform is delivering value.
What this means for sales teams
If you are selling against ServiceNow or Workday, the window is renewal time. That is when GRR stops protecting them. If you are selling for them, your comp looks stable until it does not. High GRR creates predictable revenue for the business, but it also masks product issues that eventually surface.
ServiceNow has responded with aggressive M&A: five AI acquisitions in 2025 alone, including a $7.75 billion deal for cybersecurity firm Armis. The company is betting on agentic AI to fix engagement issues before contracts come up for renewal. That is a lot of acquisition activity for a platform with 98% retention.
GRR versus NRR: what actually matters
Gross Revenue Retention measures what you keep from existing customers, excluding expansions. Net Revenue Retention adds upsells and cross-sells. Top-tier B2B SaaS typically runs 90-95% GRR and 110-130% NRR. ServiceNow and Workday are outliers on GRR because of contract length, not customer love.
For sales professionals: if a vendor talks about GRR without mentioning contract terms, ask about renewal rates. If they talk about NRR without breaking out new versus retained revenue, ask about churn at renewal. The metric only tells you what happened. The contract structure tells you why.
The risk
Long contracts delay churn, they do not prevent it. When ServiceNow and Workday contracts come up for renewal, that 98% and 97% GRR stops being a safety net. If agentic AI products deliver better workflows at lower cost, enterprise buyers will switch. The stickiness is contractual, not operational. That is a revenue risk hiding in plain sight.