KEY TAKEAWAYSShares of ServiceNow are tanking 9% in premarket trading Thursday, as the software and IT services provider posted slower subscription revenue growth than it had forecast earlier and projected a slight decline in first-quarter growth.The company reported higher-than-estimated fourth-quarter adjusted earnings per share and revenue in line with estimates from analysts polled by Visible Alpha.ServiceNow shares have surged almost 50% in the past year through Wednesday. Shares of ServiceNow (NOW) ar ...

Market Adoption and Customer Base - The Now Platform is utilized by over 85% of the Fortune 500 and nearly 60% of the Global 2000, indicating strong market adoption and trust in the platform[16]. - As of December 31, 2024, the company had approximately 8,400 customers across various industries, with an increasing portion of revenues generated from government customers[69]. - Sales outside of North America represented 37% of total revenues for the year ended December 31, 2024, compared to 36% in 2023[105]. - The number of customers with annual contract value (ACV) greater than $1 million increased to 2,109 as of December 31, 2024, up from 1,885 in 2023, representing a growth of 11.9%[205]. - The renewal rate remained stable at 98% for the years ended December 31, 2024, 2023, and 2022, indicating strong customer retention[209]. AI and Technology Integration - ServiceNow has embedded Now Assist, an AI solution, to enhance user productivity and efficiency, significantly improving workflow efficiency and fidelity for customers[14]. - The company plans to continue expanding its AI-powered product portfolio, with a focus on integrating AI capabilities into existing products[17]. - ServiceNow's AI solutions, including Now Assist, are designed to automate processes and improve customer service experiences, leading to faster resolution times and increased customer satisfaction[36]. - The integration of AI in Customer Service Management allows for rapid case summaries and improved agent productivity, enhancing overall service quality[36]. - The company emphasizes a human-centered approach to deploying AI products and services at scale, ensuring trust and reliability[16]. Financial Performance and Growth - Free cash flow for the year ended December 31, 2024, was $3.455 billion, a 26.6% increase from $2.728 billion in 2023[206]. - Non-GAAP consolidated income from operations for 2024 was $3.254 billion, compared to $2.489 billion in 2023, reflecting a year-over-year increase of 30.8%[208]. - GAAP income from operations for 2024 was $1.364 billion, significantly up from $762 million in 2023, marking an increase of 79.0%[208]. - The company recognizes revenues from subscription services over the subscription term, making it difficult to rapidly increase revenues in response to new customer acquisitions[151]. - The company expects a decline in revenue growth rate over the long term due to increasing competition and market saturation, alongside rising costs from strategic investments[152]. Research and Development - The company has made significant investments in research and development to enhance platform capabilities, strengthen existing applications, and develop new services, focusing on automation, AI, and machine intelligence technologies[70]. - The company has over 2,000 U.S. and foreign patents and more than 600 pending patent applications as of December 31, 2024, reflecting its commitment to protecting its intellectual property[74]. Cybersecurity and Compliance - The cybersecurity program is overseen by the board and management, focusing on risk management and compliance with industry standards[169]. - The company has conducted independent cyber maturity assessments in 2022, 2023, and 2024 to evaluate its cybersecurity controls[176]. - The company faces increasing cybersecurity risks due to reliance on third-party providers and public cloud infrastructure, with supply chain attacks becoming more frequent and severe[127]. - Vulnerabilities in the company's products and services have been identified, with expectations of ongoing challenges in addressing these vulnerabilities and delays in developing effective patches[128]. - An actual or perceived security breach could materially affect the company's operations, finances, and reputation, leading to significant costs and liabilities[132]. Employee Engagement and Wellbeing - The company has implemented a comprehensive range of benefits and wellbeing programs, including "Wellbeing Days" for employees[86]. - The company aims to create a safe and inclusive workplace, focusing on employee engagement through initiatives like the Employee Voice Survey[80]. - The company continues to maintain systematic gender pay equity globally and conducts annual assessments to ensure no statistically significant compensation differences exist[87]. - As of December 31, 2024, the company employed 26,293 full-time employees, with 13,193 in the United States and 13,100 internationally[89]. Strategic Partnerships and Market Expansion - The company has expanded partnerships with technology companies, including NVIDIA, to enhance enterprise AI capabilities and integrate with cloud providers like Amazon Web Services[68]. - The company continues to expand its sales capabilities in new geographies and plans to increase investments in existing locations to achieve scale efficiencies in sales and marketing efforts[65]. - The company has made substantial investments in data centers and geographic-specific service delivery models to support international market expansion[105]. Risks and Challenges - The company faces risks related to compliance with evolving data privacy laws, which may impact its ability to optimize its platform[98]. - The complexity of customer deals is increasing, leading to longer sales cycles and greater competition, which may negatively impact the company's ability to close sales[122]. - The procurement process for government contracts is highly competitive and time-consuming, which may affect the company's ability to secure contracts[116]. - The company may face increased operational costs and restrictions due to compliance with local laws and regulations in international markets[107]. - The company recognizes that its revenue growth rate is expected to decline over the long term as the business matures[102]. Stockholder Information - The cumulative total stockholder return on the company's common stock increased to 375.50 by December 31, 2024, compared to an initial investment of $100[194]. - The board of directors does not intend to pay cash dividends on common stock for the foreseeable future, opting to retain earnings for business growth[187]. - The company has authorized a share repurchase program of up to $1.5 billion, with an additional $3.0 billion authorized in January 2025[195]. - The company repurchased a total of 293,000 shares in the fourth quarter of 2024 at an average price of $1,007.28 per share, with approximately $266 million remaining for future repurchases under the program[195].

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Financial Performance - ServiceNow reported $2 96 billion in revenue for Q4 2024, a 21 3% YoY increase [1] - EPS for the quarter was $3 67, up from $3 11 a year ago [1] - Revenue slightly exceeded the Zacks Consensus Estimate of $2 95 billion by 0 13% [1] - EPS surpassed the consensus estimate of $3 58 by 2 51% [1] Key Metrics Analysis - Current Remaining Performance Obligations (cRPO) - GAAP: $10 27 billion, slightly below the four-analyst average estimate of $10 45 billion [4] - Remaining Performance Obligations (RPO) - GAAP: $22 3 billion, slightly above the three-analyst average estimate of $22 17 billion [4] - Revenues from Professional services and other: $91 million, a 26 4% YoY increase, surpassing the nine-analyst average estimate of $77 75 million [4] - Revenues from Subscription: $2 87 billion, a 21 2% YoY increase, slightly below the nine-analyst average estimate of $2 88 billion [4] - Gross Profit (Non-GAAP) - Subscription: $2 42 billion, slightly above the eight-analyst average estimate of $2 40 billion [4] - Gross Profit (Non-GAAP) - Professional services and other: $7 million, below the eight-analyst average estimate of $8 32 million [4] Stock Performance - ServiceNow shares returned +10 4% over the past month, outperforming the Zacks S&P 500 composite's +1 7% change [3] - The stock currently has a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

ServiceNow (NOW) came out with quarterly earnings of $3.67 per share, beating the Zacks Consensus Estimate of $3.58 per share. This compares to earnings of $3.11 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 2.51%. A quarter ago, it was expected that this maker of software that automates companies' technology operations would post earnings of $3.46 per share when it actually produced earnings of $3.72, delivering a surprise ...

"ServiceNow closed out the year exceeding Q4 expectations on top of our 'beat and raise' track record," said ServiceNow Chairman and CEO Bill McDermott. "AI is fueling a top to bottom re-ordering of the enterprise technology landscape. Leaders are embracing the ServiceNow Platform as their AI agent control tower to unlock exponential productivity and seamlessly orchestrate end-to-end business transformation. We are still in the early days of a massive opportunity. ServiceNow's innovation, growth, and profit ...

Core Viewpoint - ServiceNow is expected to report strong fourth-quarter 2024 results, with significant growth in both revenues and earnings compared to the previous year [2][4][23] Financial Performance - The Zacks Consensus Estimate for fourth-quarter revenues is $2.95 billion, reflecting a year-over-year growth of 21.21% [2] - The consensus estimate for earnings is $3.58 per share, indicating a growth of 15.11% year-over-year [2] - ServiceNow anticipates fourth-quarter subscription revenues between $2.875 billion and $2.88 billion, suggesting a year-over-year improvement of 21.5-22% on a GAAP basis [4] Customer Growth and Deal Activity - As of the end of Q3 2024, ServiceNow had 2,020 customers with over $1 million in annual contract value (ACV) [5] - The company closed 96 deals greater than $1 million in net new ACV during Q3 2024, including 15 deals over $5 million and six deals over $10 million [5] Generative AI Developments - ServiceNow's generative AI offerings are gaining traction, with 44 new Now Assist customers spending over $1 million in ACV in Q3 2024 [6] - The company has successfully increased prices for its Gen AI offerings by approximately 30% [6] - The total addressable market for ServiceNow's Gen AI capabilities is projected to reach $275 billion by 2026 [15] Stock Performance - ServiceNow shares have returned 47.9% over the past 12 months, outperforming the Zacks Computer & Technology sector's 28.6% and the Computers – IT Services industry's 12.1% [7] Strategic Partnerships - ServiceNow has established significant partnerships with major companies such as Amazon, Microsoft, and NVIDIA, which are expected to enhance its market position [19] - The expanded collaboration with Amazon Web Services aims to accelerate AI-driven business transformation [20] - The partnership with Microsoft focuses on modernizing front-office business processes through AI integration [21] Innovation and Product Development - The latest update, Xanadu, introduces AI-powered solutions across various industries, enhancing customer agility and productivity [15][16] - ServiceNow plans to integrate Agentic AI into its platform to improve productivity and issue resolution [17] - The company is adding over 150 GenAI innovations to its portfolio, including AI governance features for secure practices [18]

Cutting-edge business automation software developer ServiceNow (NOW 2.58%) easily surmounted the hump of Hump Day. Its share price rose by nearly 3% on the day thanks to news about its partner program. That was more than good enough to top the S&P 500 index's 0.6% increase.An important program gets a boostServiceNow announced at its annual Sales Kickoff event that it is expanding that program. The company said it has almost quadrupled its investments into aspects of the initiative, including fresh incentive ...

The market expects ServiceNow (NOW) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended December 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on January 29, 2025, might help the stock move higher if these key numbers ar ...

Abnormal Security, a startup selling email security software to companies, said on Wednesday that it's hired former ServiceNow finance executive Lisa Banks as chief financial officer as the company gears up to prepare for an IPO.Abnormal is going after a longstanding market, which includes incumbents Mimecast and Proofpoint, adding a layer of artificial intelligence that spots attacks in email messages. Other startups such as Material Security and Sublime Security offer competitive email tools."We're disrup ...