ServiceNow Reports Third Quarter 2025 Financial Results; Board of Directors Authorizes Five-for-One Stock Split

SANTA CLARA, Calif.--( BUSINESS WIRE)--ServiceNow (NYSE: NOW), the AI platform for business transformation, today announced financial results for its third quarter ended September 30, 2025, with subscription revenues of $3,299 million in Q3 2025, representing 21.5% year-over-year growth and 20.5% in constant currency.

“This outstanding Q3 performance is the clearest demonstration yet that ServiceNow is the AI platform for business transformation,” said ServiceNow Chairman and CEO Bill McDermott. “Every enterprise in every industry is focused on AI as the innovation opportunity of our generation. Leaders work with ServiceNow because they trust this proven platform as the core of their technology estate for decades to come. From autonomous workflows to AI-driven CRM, ServiceNow is putting AI to work for people, driving massive value creation for customers and shareholders.”

As of September 30, 2025, current remaining performance obligations (“cRPO”), contract revenue that will be recognized as revenue in the next 12 months, was $11.35 billion, representing 21% year-over-year growth and 20.5% in constant currency. The company had 103 transactions over $1 million in net new annual contract value (“ACV”) in Q3, and ended the quarter with 553 customers with more than $5 million in ACV, representing 18% year-over-year growth.

“Q3 was an exceptional quarter, with standout performances across the board,” said ServiceNow President and CFO Gina Mastantuono. “Now Assist, U.S. Federal, Workflow Data Fabric, and RaptorDB were all ahead of plan. These results underscore the power of the ServiceNow AI Platform and our multiple growth vectors, from core workflow expansion to the accelerating adoption of our innovative new products. Massive platform demand, combined with AI-driven efficiencies, not only fueled fantastic results but also reinforced our ability to scale with accelerating margin expansion.”

ServiceNow today announced that its Board of Directors approved a five-for-one split of the Company’s common stock. The stock split is subject to shareholder approval, which the Company will seek at a Special Meeting of Shareholders scheduled to take place on December 5, 2025.

Recent Business Highlights

Innovation

Global and Industry Expansion

Partnerships

Investment

Recognition

Over the last few months, ServiceNow was recognized as a Leader across multiple Gartner® Magic Quadrant™ reports, including in the inaugural 2025 Gartner Magic Quadrant for Business Orchestration and Automation Technologies (2), the 2025 Gartner Magic Quadrant for AI Applications in IT Service Management (3), the 2025 Gartner Magic Quadrant for the CRM Customer Engagement Center (4), and a six-time Leader in the 2025 Gartner Magic Quadrant for Enterprise Low-Code Application platforms (5).

Throughout the quarter, ServiceNow’s purpose-driven, unified culture was recognized with placements on Forbes America’s Best Employers for Company Culture and Fortune Best Workplaces in Technology (6) lists. The company was also honored on Glassdoor’s Best-Led Company list and Ethisphere’s World’s Most Ethical Companies list.

___________________

(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)

Gartner, Inc. Magic Quadrant for Business Orchestration and Automation Technologies, by Saikat Ray, Tushar Srivastava, Marc Kerremans, October 15, 2025.

(3)

Gartner, Inc., Magic Quadrant for AI Applications in IT Service Management, by Chris Matchett, Ankita Hundal, Rich Doheny, September 2, 2025.

(4)

Gartner, Inc., Magic Quadrant for the CRM Customer Engagement Center, by Pri Rathnayake, Drew Kraus, Francesco Vicchi, Jim Robinson, October 27, 2025.

(5)

Gartner, Inc., Magic Quadrant for Enterprise Low-Code Application Platforms, by Oleksandr Matvitskyy, Akash Jain, Kyle Davis, Adrian Leow, July 28, 2025.

(6)

From Fortune Magazine. © 2025 Fortune Media IP Limited. All rights reserved. Used under license. Fortune is a registered trademark of Fortune Media IP Limited and is used under license. Fortune Magazine and Fortune Media (USA) Corporation are not affiliated with, and do not endorse products or services of, ServiceNow.

Gartner Disclaimer

The Gartner content described herein, (the "Gartner Content") represents research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. ("Gartner"), and is not representation of fact. Gartner Content speaks as of its original publication date (and not as of the date of this earnings press release) and the opinions expressed in the Gartner Content are subject to change without notice.

Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally, and MAGIC QUADRANT is a registered trademark of Gartner, Inc. And/or its affiliates and are used herein with permission. All rights reserved.

Third Quarter 2025 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the third quarter 2025:

Third Quarter 2025 GAAP Results

Third Quarter 2025 Non-GAAP Results (1)

Amount

($ millions)

Year/Year

Growth (%)

Amount

($ millions) (3)

Year/Year

Growth (%)

Subscription revenues

$3,299

21.5%

$3,267

20.5%

Professional services and other revenues

$108

31%

$107

29.5%

Total revenues

$3,407

22%

$3,374

20.5%

Amount

($ billions)

Year/Year

Growth (%)

Amount

($ billions) (3)

Year/Year

Growth (%)

cRPO

$11.35

21%

$11.27

20.5%

RPO

$24.3

24%

$24.1

23%

Amount

($ millions)

Margin (%)

Amount

($ millions) (2)

Margin (%) (2)

Subscription gross profit

$2,633

80%

$2,744

83%

Professional services and other gross profit

$—

0.5%

$12

11%

Total gross profit

$2,633

77.5%

$2,756

81%

Income from operations

$572

17%

$1,140

33.5%

Net cash provided by operating activities

$813

24%

Free cash flow

$592

17.5%

Amount

($ millions)

Earnings per

Basic/Diluted

Share ($)

Amount

($ millions) (2)

Earnings per

Basic/Diluted

Share ($) (2)

Net income

$502

$2.42 / $2.40

$1,010

$4.86 / $4.82

(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)

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

(3)

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.

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

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 trends.

U.S. Federal agencies are currently navigating changes, from tightening budgets to evolving mission demands. The recent government shutdown may also impact deal timing in the near-term. These dynamics have been reflected in our Q4 2025 guidance.

The following table summarizes our guidance for the fourth quarter 2025:

Fourth Quarter 2025

GAAP Guidance

Fourth Quarter 2025

Non-GAAP Guidance (1)

Amount

($ millions) (3)

Year/Year

Growth (%) (3)

Constant Currency

Year/Year Growth (%)

Subscription revenues

$3,420 - $3,430

19.5%

17.5% - 18%

cRPO

23%

19%

Margin (%) (2)

Income from operations

30%

Amount

(millions)

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

210

(1)

(2)

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

(3)

Guidance for GAAP subscription revenues and GAAP subscription revenues and cRPO growth rates are based on the 30-day average of foreign exchange rates for September 2025 for entities reporting in currencies other than U.S. Dollars.

The following table summarizes our guidance for the full-year 2025:

Full-Year 2025

GAAP Guidance

Full-Year 2025

Non-GAAP Guidance (1)

Amount

($ millions) (3)

Year/Year

Growth (%) (3)

Constant Currency

Year/Year Growth (%)

Subscription revenues

$12,835 - $12,845

20.5%

20%

Margin (%) (2)

Subscription gross profit

83.5%

Income from operations

31%

Free cash flow

34%

Amount

(millions)

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

210

(1)

(2)

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

(3)

GAAP subscription revenues and related growth rate for the future quarter included in our full-year 2025 guidance are based on the 30-day average of foreign exchange rates for September 2025 for entities reporting in currencies other than U.S. Dollars.

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

Conference Call Details

The conference call will begin at 2 p.m. Pacific Daylight Time (21:00 GMT) on October 29, 2025. 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/414259171

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.

Upcoming Investor Conferences

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

These include:

The live webcasts 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. 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; changes in government spending and operating status; 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, 2024, 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 putting AI to work for people. We move with the pace of innovation to help customers transform organizations across every industry while upholding a trustworthy, human centered approach to deploying our products and services at scale. Our AI platform for business transformation connects people, processes, data, and devices to increase productivity and maximize business outcomes. For more information, visit: www.servicenow.com.

© 2025 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

Nine Months Ended

September 30, 2025

September 30, 2024

September 30, 2025

September 30, 2024

Revenues:

Subscription

3,299

2,715

9,417

7,780

Professional services and other

108

293

247

Total revenues

3,407

2,797

9,710

8,027

Cost of revenues (1):

Subscription

666

496

1,852

1,406

Professional services and other

108

297

250

Total cost of revenues

774

584

2,149

1,656

Gross profit

2,633

2,213

7,561

6,371

Operating expenses (1):

Sales and marketing

1,056

944

3,238

2,827

Research and development

750

626

2,187

1,875

General and administrative

255

225

755

679

Total operating expenses

2,061

1,795

6,180

5,381

Income from operations

572

418

1,381

990

Interest income

115

108

346

313

Other income (expense), net

(10

)

(28

)

Income before income taxes

694

516

1,720

1,275

Provision for income taxes

192

373

234

Net income

502

432

1,347

1,041

Net income per share - basic

2.42

2.09

6.50

5.06

Net income per share - diluted

2.40

2.07

6.43

5.00

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

208

206

207

206

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

210

209

208

(1)

Includes stock-based compensation as follows:

Three Months Ended

Nine Months Ended

September 30, 2025

September 30, 2024

September 30, 2025

September 30, 2024

Cost of revenues:

Subscription

222

184

Professional services and other

Operating expenses:

Sales and marketing

141

144

444

419

Research and development

203

150

584

479

General and administrative

178

175

ServiceNow, Inc.

Condensed Consolidated Balance Sheets

(in millions)

September 30, 2025

December 31, 2024

(unaudited)

Assets

Current assets:

Cash and cash equivalents

2,725

2,304

Marketable securities

2,686

3,458

Accounts receivable, net

1,548

2,240

Current portion of deferred commissions

559

517

Prepaid expenses and other current assets

846

668

Total current assets

8,364

9,187

Deferred commissions, less current portion

1,017

999

Long-term marketable securities

4,266

4,111

Strategic investments

1,508

472

Property and equipment, net

2,127

1,763

Operating lease right-of-use assets

807

693

Intangible assets, net

391

209

Goodwill

1,820

1,273

Deferred tax assets

1,217

1,385

Other assets

272

291

Total assets

21,789

20,383

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

146

Accrued expenses and other current liabilities

1,267

1,369

Current portion of deferred revenue

6,347

6,819

Current portion of operating lease liabilities

107

102

Total current liabilities

7,867

8,358

Deferred revenue, less current portion

115

Operating lease liabilities, less current portion

804

687

Long-term debt, net

1,491

1,489

Other long-term liabilities

211

145

Stockholders’ equity

11,301

9,609

Total liabilities and stockholders’ equity

21,789

20,383

Note: Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications did not result in a restatement of prior period condensed consolidated financial statements.

ServiceNow, Inc.

Condensed Consolidated Statements of Cash Flows

(in millions)

(unaudited)

Three Months Ended

Nine Months Ended

September 30, 2025

September 30, 2024

September 30, 2025

September 30, 2024

Cash flows from operating activities:

Net income

502

432

1,347

1,041

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

Depreciation and amortization

194

144

526

410

Amortization of deferred commissions

161

140

454

403

Stock-based compensation

492

426

1,461

1,292

Deferred income taxes

124

)

172

Other

(19

)

(31

)

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

Accounts receivable

141

228

740

727

Deferred commissions

(171

)

(155

)

(462

)

(461

)

Prepaid expenses and other assets

(15

)

(199

)

(267

)

Accounts payable

(85

)

(130

)

Deferred revenue

(449

)

(263

)

(713

)

(355

)

Accrued expenses and other liabilities

(100

)

(125

)

(211

)

(216

)

Net cash provided by operating activities

813

671

3,206

2,632

Cash flows from investing activities:

Purchases of property and equipment

(235

)

(202

)

(630

)

(599

)

Business combinations, net of cash acquired

(139

)

(41

)

(215

)

(82

)

Purchases of other intangibles

)

—

(43

)

(30

)

Purchases of marketable securities

(397

)

(1,292

)

(2,719

)

(3,952

)

Purchases of strategic investments

(882

)

(61

)

(1,020

)

(149

)

Sales and maturities of marketable securities

1,129

911

3,410

3,024

Other

(18

)

Net cash used in investing activities

(551

)

(658

)

(1,191

)

(1,763

)

Cash flows from financing activities:

Proceeds from employee stock plans

117

106

270

237

Repurchases of common stock

(584

)

(225

)

(1,243

)

(400

)

Taxes paid related to net share settlement of equity awards

(190

)

(173

)

(628

)

(525

)

Business combination

—

(184

)

Net cash used in financing activities

(657

)

(292

)

(1,601

)

(872

)

Foreign currency effect on cash, cash equivalents and restricted cash

)

Net change in cash, cash equivalents and restricted cash

(399

)

(274

)

424

(11

)

Cash, cash equivalents and restricted cash at beginning of period

3,133

2,167

2,310

1,904

Cash, cash equivalents and restricted cash at end of period

2,734

1,893

2,734

1,893

ServiceNow, Inc.

GAAP to Non-GAAP Reconciliation

(in millions, except per share data)

(unaudited)

Three Months Ended

Nine Months Ended

September 30, 2025

September 30, 2024

September 30, 2025

September 30, 2024

Gross profit:

GAAP subscription gross profit

2,633

2,219

7,565

6,374

Stock-based compensation

222

184

Amortization of purchased intangibles

Severance costs

—

Non-GAAP subscription gross profit

2,744

2,305

7,866

6,622

GAAP professional services and other gross profit (loss)

—

)

Stock-based compensation

Severance costs

—

Non-GAAP professional services and other gross profit

GAAP gross profit

2,633

2,213

7,561

6,371

Stock-based compensation

255

219

Amortization of purchased intangibles

Severance costs

—

Non-GAAP gross profit

2,756

2,310

7,896

6,654

Gross margin:

GAAP subscription gross margin

81.5

80.5

Stock-based compensation as % of subscription revenues

2.5

Amortization of purchased intangibles as % of subscription revenues

Severance costs as % of subscription revenues

—

Non-GAAP subscription gross margin

83.5

GAAP professional services and other gross margin

0.5

(6.5

(1.5

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

10.5

11.5

Severance costs as % of professional services and other revenues

0.5

—

0.5

—

Non-GAAP professional services and other gross margin

7.5

GAAP gross margin

77.5

79.5

Stock-based compensation as % of total revenues

2.5

Amortization of purchased intangibles as % of total revenues

Severance costs as % of total revenues

—

Non-GAAP gross margin

82.5

81.5

Income from operations:

GAAP income from operations

572

418

1,381

990

Stock-based compensation

492

426

1,461

1,292

Amortization of purchased intangibles

Business combination and other related costs

Impairment of assets

—

Severance costs

—

Non-GAAP income from operations

1,140

872

3,048

2,383

Operating margin:

GAAP operating margin

12.5

Stock-based compensation as % of total revenues

14.5

Amortization of purchased intangibles as % of total revenues

Business combination and other related costs as % of total revenues

0.5

—

0.5

Impairment of assets as % of total revenues

—

0.5

—

Severance costs as % of total revenues

0.5

—

0.5

—

Non-GAAP operating margin

33.5

31.5

29.5

Net income:

GAAP net income

502

432

1,347

1,041

Stock-based compensation

492

426

1,461

1,292

Amortization of purchased intangibles

Business combination and other related costs

Impairment of assets

—

Severance costs

—

Income tax effects and adjustments (1)

(60

)

(110

)

(304

)

(300

)

Non-GAAP net income

1,010

775

2,710

2,133

Net income per share - basic and diluted:

GAAP net income per share - basic

2.42

2.09

6.50

5.06

GAAP net income per share - diluted

2.40

2.07

6.43

5.00

Non-GAAP net income per share - basic

4.86

3.76

13.08

10.37

Non-GAAP net income per share - diluted

4.82

3.72

12.94

10.26

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

208

206

207

206

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

210

209

208

Free cash flow:

GAAP net cash provided by operating activities

813

671

3,206

2,632

Purchases of property and equipment

(235

)

(202

)

(630

)

(599

)

Business combination and other related costs

Non-GAAP free cash flow

592

471

2,604

2,055

Free cash flow margin:

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

Purchases of property and equipment as % of total revenues

(6.5

(7.5

Business combination and other related costs as % of total revenues

0.5

—

0.5

—

Non-GAAP free cash flow margin

17.5

25.5

(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 20% for each of the three and nine months ended September 30, 2025 and 2024. 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.

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

ServiceNow, Inc.

Reconciliation of Non-GAAP Financial Guidance

Three Months Ending

December 31, 2025

GAAP operating margin

Stock-based compensation expense as % of total revenues

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

Twelve Months Ending

December 31, 2025

GAAP subscription gross margin

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

83.5

GAAP operating margin

Stock-based compensation expense as % of total revenues

Amortization of purchased intangibles as % of total revenues

Business combination and other related costs as % of total revenues

—

Impairment of assets as % of total revenues

—

Severance costs as % of total revenues

Non-GAAP operating margin

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

Purchases of property and equipment as % of total revenues

Business combination and other related costs as % of total revenues

—

Non-GAAP free cash flow margin

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