ServiceNow Reports First Quarter 2026 Financial Results

ServiceNow Reports First Quarter 2026 Financial Results SANTA CLARA, Calif.--( BUSINESS WIRE)--ServiceNow (NYSE: NOW), the AI control tower for business reinvention, today announced financial results for its first quarter ended March 31, 2026, with subscription revenues of $3,671 million in Q1 2026, representing 22% year-over-year growth and 19% in constant currency.

“ServiceNow’s first quarter performance beat the high end of our guidance once again,” said ServiceNow Chairman and CEO Bill McDermott. “Since our founding, we’ve built our platform around the work customers need to accomplish. Today, they rely on ServiceNow to be their AI control tower for business reinvention. Customers trust our platform because we integrate with any model, cloud, interface, data, and system they choose to deploy. As new technologies create both opportunity and risk, our two decades of engineering combined with deep business context enable us to orchestrate and secure the agentic enterprise. With this foundation, our AI growth is far exceeding even our own expectations, reinforcing our position as one of the fastest growing enterprise software companies ever.”

As of March 31, 2026, current remaining performance obligations (“cRPO”), contract revenue that will be recognized as revenue in the next 12 months, was $12.64 billion, representing 22.5% year-over-year growth and 21% in constant currency. The company had 16 transactions over $5 million in net new annual contract value (“ACV”) in Q1 2026, representing nearly 80% year-over-year growth, and ended the quarter with 630 customers with more than $5 million in ACV, representing approximately 22% year-over-year growth.

“In Q1, we exceeded the high end of our topline and profitability guidance metrics, grew free cash flow, and returned capital to shareholders,” said ServiceNow President and CFO Gina Mastantuono. “The early close of our Armis acquisition meaningfully expands our TAM and accelerates our subscription revenue growth trajectory. With agentic AI, workflow orchestration, security, and data fabric converging on a single platform, we believe the most compelling chapter in ServiceNow's growth story is just beginning.”

Recent Business Highlights

Innovation

This quarter, ServiceNow advanced enterprise AI into new product categories, new ways of working, and a new commercial model.

Partnerships

ServiceNow's partner ecosystem expanded significantly in Q1, with leading companies building on the platform to deliver AI at a global scale.

Industry Expansion

This quarter, the ServiceNow AI Platform drove measurable outcomes across multiple industries, turning industry depth into operational results.

Acquisitions

ServiceNow closed two acquisitions that are designed to give enterprises a unified, end-to-end security stack that can see, decide, and act across the entire technology footprint.

Investment

Recognition

ServiceNow's leadership in AI innovation and workplace culture earned recognition from analysts and institutions across the industry.

____________________

1 The program does not have a fixed expiration date, may be suspended, or discontinued at any time, and does not obligate ServiceNow to acquire any amount of its common stock. The timing, manner, price, and amount of any repurchases will be determined by ServiceNow at its discretion and will depend on a variety of factors, including business, economic and market conditions, prevailing stock prices, corporate and regulatory requirements, and other considerations.

2 The Forrester Wave™: Industry Cloud Solutions for Public Sector, Q1 2026, Forrester Research, Inc., February 19, 2026.

3 The Forrester Wave™: Customer Service Solutions, Q1 2026, Forrester Research, Inc., March 10, 2026.

Forrester Disclaimer

Forrester does not endorse any company, product, brand, or service included in its research publications and does not advise any person to select the products or services of any company or brand based on the ratings included in such publications. Information is based on the best available resources. Opinions reflect judgment at the time and are subject to change. For more information, read about Forrester’s objectivity at https://www.forrester.com/about-us/objectivity/.

4 IDC MarketScape: Worldwide AIOps 2026 Vendor Assessment (doc #US54116226, March 2026).

5 ISG Buyers Guide™ for Application Platforms, 2026, ISG Research®, February 2026.

6 ISG Buyers Guide™ for Field Service Management, 2026, ISG Research®, February 2026.

First Quarter 2026 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the first quarter 2026:

First Quarter 2026 GAAP Results

First Quarter 2026

Non-GAAP Results (1)

Amount

($ millions)

Year/Year

Growth (%)

Amount

($ millions) (2)

Year/Year

Growth (%)

Subscription revenues

3,671

3,572

Professional services and other revenues

18.5

15.5

Total revenues

3,770

3,668

Amount

($ billions)

Year/Year

Growth (%)

Amount

($ billions) (2)

Year/Year

Growth (%)

cRPO

12.64

22.5

12.45

RPO

27.7

27.3

23.5

Amount

($ millions)

Margin (%)

Amount

($ millions) (3)

Margin (%) (3)

Subscription gross profit

2,851

77.5

2,997

81.5

Professional services and other gross loss

(21

)

(21

)

Total gross profit

2,830

2,988

79.5

Income from operations

503

13.5

1,199

Net cash provided by operating activities

1,670

44.5

Free cash flow

1,665

Amount

($ millions)

Earnings per Basic/Diluted Share ($)

Amount

($ millions) (3)

Earnings per

Basic/Diluted

Share ($) (3)

Net income

469

$0.45 / $0.45

1,012

$0.98 / $0.97

(1)

We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section entitled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP measures.

(2)

Non-GAAP subscription revenues and total revenues are adjusted for constant currency by excluding effects of foreign currency rate fluctuations and any gains or losses from foreign currency hedge contracts. Professional services and other revenues, cRPO, and RPO are adjusted only for constant currency. See the section entitled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP measures.

(3)

Refer to the table entitled “GAAP to Non-GAAP Reconciliation” for a reconciliation of GAAP to non-GAAP measures.

Financial Outlook

Our guidance includes GAAP and non‑GAAP financial measures. The non‑GAAP growth rates for subscription revenues are adjusted for constant currency by excluding the effects of foreign currency rate fluctuations and any gains or losses from foreign currency hedge contracts, and the non-GAAP growth rates for cRPO are adjusted only for constant currency to provide better visibility into the underlying business.

In Q1 2026, subscription revenues growth saw an approximately 75 basis point headwind from delayed closings of several large on-premise deals in the Middle East, due to the ongoing conflict in the region. This outlook reflects a prudent assessment of those geopolitical headwinds on deal timing for the remainder of FY 2026.

Our Q2 2026 subscription revenues growth, Q2 2026 cRPO growth, and FY 2026 subscription revenues growth guidance each include approximately 125 basis points of contribution from Armis. A portion of Armis customer contracts include termination‑for‑convenience provisions, which limit the amount of contract value reflected in cRPO.

The acquisition is also expected to create headwinds of approximately 25 basis points to FY 2026 subscription gross margin, approximately 75 basis points to FY 2026 operating margin, approximately 200 basis points to FY 2026 free cash flow margin, and approximately 125 basis points to Q2 2026 operating margin. While we will see some near-term headwinds to margins as we integrate the business in FY 2026, strong AI efficiencies internally from Now on Now and our underlying platform leverage are expected to normalize our operating and free cash flow margin expansion trajectories in FY 2027.

The following table summarizes our guidance for the second quarter 2026:

Second Quarter 2026

GAAP Guidance

Second Quarter 2026

Non-GAAP Guidance (1)

Amount

($ millions) (2)

Year/Year

Growth (%) (2)

Constant Currency

Year/Year Growth (%)

Subscription revenues

$3,815 - $3,820

22.5%

21% - 21.5%

cRPO

19%

19.5%

Margin (%) (3)

Income from operations

26.5%

Amount

(billions)

Weighted-average shares used to compute diluted net income per share

1.04

(1)

(2)

Guidance for GAAP subscription revenues and GAAP subscription revenues and cRPO growth rates are based on the 31-day average of foreign exchange rates for March 2026 for entities reporting in currencies other than U.S. Dollars.

(3)

Refer to the table entitled “Reconciliation of Non-GAAP Financial Guidance” for a reconciliation of GAAP to non-GAAP measures.

The following table summarizes our guidance for the full-year 2026:

Full-Year 2026

GAAP Guidance

Full-Year 2026

Non-GAAP Guidance (1)

Amount

($ millions) (2)

Year/Year

Growth (%) (2)

Constant Currency

Year/Year Growth (%)

Subscription revenues

$15,735 - $15,775

22% - 22.5%

20.5% - 21%

Margin (%) (3)

Subscription gross profit

81.5%

Income from operations

31.5%

Free cash flow

35%

Amount

(billions)

Weighted-average shares used to compute diluted net income per share

1.04

(1)

(2)

GAAP subscription revenues and related growth rate for the future quarter included in our full-year 2026 guidance are based on the 31-day average of foreign exchange rates for March 2026 for entities reporting in currencies other than U.S. Dollars.

(3)

Refer to the table entitled “Reconciliation of Non-GAAP Financial Guidance” for a reconciliation of GAAP to non-GAAP measures.

Conference Call Details

The conference call will begin at 2 p.m. Pacific Daylight Time (21:00 GMT) on April 22, 2026. Interested parties may listen to the call by dialing (888) 330‑2455 (Passcode: 8135305), or if outside North America, by dialing (240) 789‑2717 (Passcode: 8135305). Individuals may access the live teleconference from this webcast.

https://events.q4inc.com/attendee/481376230

An audio replay of the conference call and webcast will be available two hours after its completion and will be accessible for 30 days. To hear the replay, interested parties may go to the investor relations section of the ServiceNow website or dial (800) 770‑2030 (Passcode: 8135305), or if outside North America, by dialing (647) 362‑9199 (Passcode: 8135305).

Investor Presentation Details

An investor presentation providing additional information, including forward-looking guidance, and analysis can be found at https://investors.servicenow.com.

Financial Analyst Day

ServiceNow will host its Financial Analyst Day 2026 on Monday, May 4, at 1:30 p.m. PT in Las Vegas, Nevada. This half‑day program will feature presentations by ServiceNow executives who will provide financial updates and showcase ServiceNow’s latest capabilities for AI-driven workflows and platform innovation. A livestream will also be available the day of the event and a replay will be posted the following day at https://investors.servicenow.com.

Upcoming Investor Conferences

ServiceNow today announced that it will attend and have executives present at five upcoming investor conferences.

These include:

The live webcast for each will be accessible on the investor relations section of the ServiceNow website at https://investors.servicenow.com and archived on the ServiceNow site for a period of 30 days.

Statement Regarding Use of Non-GAAP Financial Measures

We use the following non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Please see the tables included at the end of this release for the reconciliation of GAAP and non-GAAP results for gross profit, income from operations, net income, net income per share, and free cash flow.

Use of Forward-Looking Statements

This release contains “forward-looking statements” regarding our performance, including but not limited to statements in the section entitled “Financial Outlook” and statements regarding the expected benefits of our announced partnerships and acquisitions. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make.

Factors that may cause actual results to differ materially from those in any forward-looking statements include, among others, experiencing an actual or perceived cyber-security event or weakness; our ability to comply with evolving privacy laws, data transfer restrictions, and other foreign and domestic standards related to data and the Internet; errors, interruptions, delays or security breaches in or of our service or data centers; our ability to maintain and attract key employees and manage workplace culture; alleged violations of laws and regulations, including those relating to anti-bribery and anti-corruption and those relating to public sector contracting requirements; our ability to compete successfully against existing and new competitors; our ability to predict, prepare for and respond promptly to rapidly evolving technological, market and customer developments; our ability to grow our business, including converting remaining performance obligations into revenue, adding and retaining customers, selling additional subscriptions to existing customers, selling to larger enterprises, government and regulated organizations with complex sales cycles and certification processes, and entering new geographies and markets; our ability to develop and gain customer demand for and acceptance of existing, new and improved products and services, including products that incorporate AI technology; our ability to expand and maintain our partnerships and partner programs, including expected market opportunity from such relationships, and realize the anticipated benefits thereof; global macroeconomic and political conditions including tariffs, inflation and armed conflicts; fluctuations in the value of foreign currencies relative to the U.S. Dollar; fluctuations in interest rates; our ability to consummate and realize the benefits of any strategic transactions or acquisitions; our ability to execute share repurchases, including the timing, manner, price, and amount of any repurchase; and fluctuations and volatility in our stock price.

Further information on these and other factors that could affect our financial results are included in our Form 10-K for the year ended December 31, 2025, and in other filings we make with the Securities and Exchange Commission from time to time.

We undertake no obligation, and do not intend, to update these forward-looking statements, to review or confirm analysts’ expectations, or to provide interim reports or updates on the progress of the current financial quarter.

About ServiceNow

ServiceNow (NYSE: NOW) is the AI control tower for business reinvention. The ServiceNow AI Platform integrates with any cloud, any model, and any data source to orchestrate how work flows across the enterprise. By unifying legacy systems, departmental tools, cloud applications, and AI agents, ServiceNow provides a single pane of glass that connects intelligence to execution across every corner of business. With more than 95 billion workflows running on the platform each year, ServiceNow helps organizations turn fragmented operations into coordinated, autonomous workflows that deliver measurable results. Learn how ServiceNow puts AI to work for people at www.servicenow.com.

© 2026 ServiceNow, Inc. All rights reserved. ServiceNow, the ServiceNow logo, Now, and other ServiceNow marks are trademarks and/or registered trademarks of ServiceNow, Inc. in the United States and/or other countries. Other company names, product names, and logos may be trademarks of the respective companies with which they are associated.

ServiceNow, Inc.

Condensed Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)

Three Months Ended

March 31, 2026

March 31, 2025

Revenues:

Subscription

3,671

3,005

Professional services and other

Total revenues

3,770

3,088

Cost of revenues (1):

Subscription

820

561

Professional services and other

120

Total cost of revenues

940

651

Gross profit

2,830

2,437

Operating expenses (1):

Sales and marketing

1,216

1,054

Research and development

823

703

General and administrative

288

229

Total operating expenses

2,327

1,986

Income from operations

503

451

Interest income

115

Other income (expense), net

(11

)

Income before income taxes

673

555

Provision for income taxes

204

Net income

469

460

Net income per share - basic (2)

0.45

0.44

Net income per share - diluted (2)

0.45

0.44

Weighted-average shares used to compute net income per share - basic (2)

1,035

1,034

Weighted-average shares used to compute net income per share - diluted (2)

1,040

1,047

Includes stock-based compensation as follows:

Three Months Ended

March 31, 2026

March 31, 2025

Cost of revenues:

Subscription

Professional services and other

Operating expenses:

Sales and marketing

150

148

Research and development

236

185

General and administrative

(2)

Prior period results have been retroactively adjusted to reflect the effects of the five-for-one stock split, which was effective December 17, 2025

ServiceNow, Inc.

Condensed Consolidated Balance Sheets

(in millions)

March 31, 2026

December 31, 2025

(unaudited)

Assets

Current assets:

Cash and cash equivalents

2,702

3,726

Marketable securities

2,480

2,558

Accounts receivable, net

1,713

2,627

Current portion of deferred commissions

591

590

Prepaid expenses and other current assets

949

970

Total current assets

8,435

10,471

Deferred commissions, less current portion

1,129

1,114

Long-term marketable securities

2,724

3,771

Strategic investments

1,743

1,542

Property and equipment, net

2,250

2,289

Operating lease right-of-use assets

831

806

Intangible assets, net

1,479

1,121

Goodwill

4,541

3,578

Deferred tax assets

914

1,056

Other assets

335

290

Total assets

24,381

26,038

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

427

204

Accrued expenses and other current liabilities

1,408

1,813

Current portion of deferred revenue

8,030

8,314

Current portion of operating lease liabilities

118

112

Total current liabilities

9,983

10,443

Deferred revenue, less current portion

120

Operating lease liabilities, less current portion

822

800

Long-term debt, net

1,491

Other long-term liabilities

258

220

Stockholders’ equity

11,728

12,964

Total liabilities and stockholders’ equity

24,381

26,038

ServiceNow, Inc.

Condensed Consolidated Statements of Cash Flows

(in millions)

(unaudited)

Three Months Ended

March 31, 2026

March 31, 2025

Cash flows from operating activities:

Net income

469

460

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

258

160

Amortization of deferred commissions

168

145

Stock-based compensation

547

470

Deferred income taxes

102

Other

(82

)

Changes in operating assets and liabilities, net of effect of business combinations:

Accounts receivable

912

901

Deferred commissions

(195

)

(155

)

Prepaid expenses and other assets

(42

)

(139

)

Accounts payable

250

234

Deferred revenue

(278

)

(148

)

Accrued expenses and other liabilities

(439

)

(287

)

Net cash provided by operating activities

1,670

1,677

Cash flows from investing activities:

Purchases of property and equipment

(141

)

(205

)

Business combinations, net of cash acquired

(1,325

)

(18

)

Purchases of other intangibles

—

(34

)

Purchases of marketable securities

(31

)

(1,140

)

Purchases of strategic investments

(121

)

Sales and maturities of marketable securities

1,139

1,181

Other

Net cash used in investing activities

(451

)

(217

)

Cash flows from financing activities:

Proceeds from employee stock plans

153

Repurchases of common stock

(2,225

)

(298

)

Taxes paid related to net share settlement of equity awards

(164

)

(253

)

Net cash used in financing activities

(2,236

)

(398

)

Foreign currency effect on cash, cash equivalents and restricted cash

)

Net change in cash, cash equivalents and restricted cash

(1,022

)

1,067

Cash, cash equivalents and restricted cash at beginning of period

3,732

2,310

Cash, cash equivalents and restricted cash at end of period

2,710

3,377

ServiceNow, Inc.

GAAP to Non-GAAP Reconciliation

(in millions, except per share data)

(unaudited)

Three Months Ended

March 31, 2026

March 31, 2025

Gross profit:

GAAP subscription gross profit

2,851

2,444

Stock-based compensation

Amortization of purchased intangibles

Severance costs

—

Non-GAAP subscription gross profit

2,997

2,532

GAAP professional services and other gross loss

(21

)

Stock-based compensation

Non-GAAP professional services and other gross (loss) profit

)

GAAP gross profit

2,830

2,437

Stock-based compensation

Amortization of purchased intangibles

Severance costs

—

Non-GAAP gross profit

2,988

2,536

Gross margin:

GAAP subscription gross margin

77.5

81.5

Stock-based compensation as % of subscription revenues

2.5

Amortization of purchased intangibles as % of subscription revenues

1.5

0.5

Severance costs as % of subscription revenues

—

Non-GAAP subscription gross margin

81.5

84.5

GAAP professional services and other gross margin

(21

(8.5

Stock-based compensation as % of professional services and other revenues

11.5

Non-GAAP professional services and other gross margin

GAAP gross margin

Stock-based compensation as % of total revenues

2.5

Amortization of purchased intangibles as % of total revenues

1.5

0.5

Severance costs as % of total revenues

—

Non-GAAP gross margin

79.5

Income from operations:

GAAP income from operations

503

451

Stock-based compensation

558

470

Amortization of purchased intangibles

Business combination and other related costs

Severance costs

—

Non-GAAP income from operations

1,199

953

Operating margin:

GAAP operating margin

13.5

14.5

Stock-based compensation as % of total revenues

Amortization of purchased intangibles as % of total revenues

0.5

Business combination and other related costs as % of total revenues

0.5

Severance costs as % of total revenues

0.5

—

Non-GAAP operating margin

Net income:

GAAP net income

469

460

Stock-based compensation

558

470

Amortization of purchased intangibles

Business combination and other related costs

Severance costs

—

(Gains)/losses on strategic investments, net (3)

(87

)

—

Income tax effects and adjustments (1)(3)

(66

)

(116

)

Non-GAAP net income (3)

1,012

846

Net income per share - basic and diluted:

GAAP net income per share - basic (2)

0.45

0.44

GAAP net income per share - diluted (2)

0.45

0.44

Non-GAAP net income per share - basic (2) (3)

0.98

0.82

Non-GAAP net income per share - diluted (2)(3)

0.97

0.81

Weighted-average shares used to compute net income per share - basic (2)

1,035

1,034

Weighted-average shares used to compute net income per share - diluted (2)

1,040

1,047

Free cash flow:

GAAP net cash provided by operating activities

1,670

1,677

Purchases of property and equipment

(141

)

(205

)

Business combination and other related costs

136

Non-GAAP free cash flow

1,665

1,477

Free cash flow margin:

GAAP net cash provided by operating activities as % of total revenues

44.5

54.5

Purchases of property and equipment as % of total revenues

(3.5

(6.5

Business combination and other related costs as % of total revenues

3.5

—

Non-GAAP free cash flow margin

(1)

We use a non-GAAP effective tax rate for evaluating our operating results to provide consistency across reporting periods. Based on our long-term projections, we are using a non-GAAP tax rate of 21% and 20% for the three months ended March 31, 2026 and 2025, respectively. This non-GAAP tax rate could change for various reasons including significant changes in our geographic earnings mix or fundamental tax law changes in major jurisdictions in which we operate.

(2)

Prior period results have been retroactively adjusted to reflect the effects of the five-for-one stock split, which was effective December 17, 2025.

(3)

Prior period results have been retroactively adjusted to reflect the exclusion of gains and losses on strategic investments.

ServiceNow, Inc.

Reconciliation of Non-GAAP Financial Guidance

Three Months Ending

June 30, 2026

GAAP operating margin

3.5%

Stock-based compensation expense as % of total revenues

16%

Amortization of purchased intangibles as % of total revenues

Business combination and other related costs as % of total revenues

Severance costs as % of total revenues

Non-GAAP operating margin

26.5%

Twelve Months Ending

December 31, 2026

GAAP subscription gross margin

76%

Stock-based compensation expense as % of subscription revenues

Amortization of purchased intangibles as % of subscription revenues

Severance costs as % of subscription revenues

— %

Non-GAAP subscription margin

81.5%

GAAP operating margin

11%

Stock-based compensation expense as % of total revenues

15%

Amortization of purchased intangibles as % of total revenues

Business combination and other related costs as % of total revenues

Severance costs as % of total revenues

—%

Non-GAAP operating margin

31.5%

GAAP net cash provided by operating activities as % of total revenues

39%

Purchases of property and equipment as % of total revenues

(5%)

Business combination and other related costs as % of total revenues

Non-GAAP free cash flow margin

35%

Note: Numbers are rounded for presentation purposes and may not foot.