Core Insights - ServiceNow's workflows are gaining traction, with technology workflows winning 40 deals worth over $1 million in Q2 2025, including 4 deals over $5 million [1] - The company is expanding its footprint among enterprises through Workflow Data Fabric, which is included in 17 of its top 20 largest deals [2] - Subscription revenues increased by 21.5% year over year to $3.113 billion in Q2 2025, with a significant rise in high-value customers [3][10] - ServiceNow raised its subscription revenue guidance for 2025 to between $12.775 billion and $12.795 billion, indicating a growth of 19.5-20% on a non-GAAP constant currency basis [4] Subscription Revenue and Customer Growth - Subscription revenues for Q2 2025 reached $3.113 billion, marking a 21.5% increase year over year [3][10] - The number of customers generating over $5 million in annual contract value (ACV) reached 528, with those contributing $20 million or more increasing by over 30% year over year [3] - ServiceNow closed 89 deals greater than $1 million in net new ACV during the reported quarter, including 11 deals over $5 million [3] Competitive Landscape - ServiceNow faces strong competition in the workflow automation space from Pegasystems and Salesforce [5] - Pegasystems is experiencing robust demand for its GenAI Blueprint solution, which is expected to drive ACV growth [6] - Salesforce is seeing broad adoption of its platform, integrating various workflows and enhancing its ecosystem through partnerships with major data platforms [7] Valuation and Stock Performance - ServiceNow shares have declined by 12.4% year to date, underperforming the broader Zacks Computer and Technology sector, which returned 13.4% [8] - The company's stock is considered overvalued, with a forward 12-month price/sales ratio of 13.12X compared to the sector's 6.7X [13] - The Zacks Consensus Estimate for Q3 2025 earnings is $4.22 per share, indicating a year-over-year growth of 13.4% [14]