- ServiceNow raised its full-year subscription revenue forecast to $10.58 billion to $10.59 billion, up from the previous forecast of $10.56 billion to $10.58 billion.
- The company still projects its subscription adjusted gross margin at 84.5%, slightly below the estimate of 84.6%.
- Third Quarter Forecast:
- Subscription revenue forecasted between $2.66 billion to $2.67 billion, below the estimate of $2.68 billion.
- Second Quarter Results:
- Adjusted EPS was $3.13, up from $2.37 year-over-year, exceeding the estimate of $2.86.
- Adjusted revenue came in at $2.64 billion, surpassing the estimate of $2.61 billion.
- Subscription revenue was $2.54 billion, slightly above the estimate of $2.53 billion.
- Professional Services & Other revenue reached $85 million, exceeding the estimate of $79.6 million.
- Adjusted gross profit amounted to $2.17 billion, higher than the estimate of $2.15 billion.
- Adjusted gross margin stood at 83%, compared to the estimate of 82.2%.
- Subscription adjusted gross margin was 85%, above the estimate of 84.4%.
- Professional Services & Other adjusted gross margin was 16%, significantly surpassing the estimate of 10.4%.
- Remaining performance obligations totaled $18.6 billion, higher than the estimate of $17.59 billion.
- Current remaining performance obligation was $8.78 billion, above the estimate of $8.68 billion.
- Free cash flow was reported at $359 million, falling short of the estimate of $472.8 million.
- Key Personnel Change:
- The company and CJ Desai, President and Chief Operating Officer, mutually agreed that Desai would resign from all positions effective immediately.
Servicenow Inc on Smartkarma
Analysts on Smartkarma, such as Baptista Research, have been closely following Servicenow Inc. and providing valuable insights into the company’s performance and growth prospects.
Baptista Research‘s reports on Servicenow highlight the positive trajectory of the company, with strong financial results in recent quarters driven by factors such as the adoption of GenAI technology. The reports emphasize key metrics like subscription revenue growth and current remaining performance obligations (CRPO), showcasing Servicenow’s ability to exceed market expectations and capitalize on major drivers like artificial intelligence (AI) for sustained expansion.
A look at Servicenow Inc Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 1 | |
| Growth | 5 | |
| Resilience | 4 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
When looking at the long-term outlook for ServiceNow Inc using the Smartkarma Smart Scores, the company shows a mixed picture. With a strong score in Growth and Resilience, ServiceNow Inc is positioned well for future expansion and able to withstand market challenges. The high Growth score suggests the company has great potential for increasing its market share and revenue over time. In addition, the Resilience score indicates that ServiceNow Inc is equipped to navigate through economic downturns and uncertainties.
However, the company’s lower scores in Value, Dividend, and Momentum indicate some areas of weakness. Investors looking for a value play or dividend income may find ServiceNow Inc less attractive in comparison to other companies in the market. The Momentum score, while moderate, suggests there may be some fluctuations in the company’s stock performance in the near term. Overall, ServiceNow Inc, a provider of enterprise IT management software, appears well-positioned for growth and resilience in the long run despite some challenges in other areas.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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