ServiceNow (NYSE:NOW) Issues Quarterly Earnings Results, Beats Expectations By $0.03 EPS

ServiceNow (NYSE:NOW) issued its quarterly earnings data on Wednesday. The information technology services provider reported $0.92 EPS for the quarter, topping analysts’ consensus estimates of $0.89 by $0.03, FiscalAI reports. The firm had revenue of $3.57 billion for the quarter, compared to analyst estimates of $3.53 billion. ServiceNow had a net margin of 13.66% and a return on equity of 18.74%. The firm’s revenue was up 20.7% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.73 EPS.

Here are the key takeaways from ServiceNow’s conference call:

• ServiceNow beat Q4 guidance, reporting ~21% subscription growth (19.5% constant currency), CRPO growth of 25% (21% cc), and an operating margin of 31%, and it guided to ~20% subscription revenue growth for 2026.
• AI monetization is accelerating: Now Assist surpassed $600M ACV, more than doubled year‑over‑year in Q4 with many $1M+ deals and increased token consumption via “assist packs,” while workflows and transactions grew >33% YoY.
• The board authorized an incremental $5 billion share repurchase program with an immediate $2 billion accelerated share repurchase, signaling a material near‑term return of capital.
• Strategic M&A (Moveworks, Veza, Armis) is positioned to expand ServiceNow’s TAM around AI visibility, identity, and orchestration; management expects Armis to contribute roughly 1% to 2026 subscription revenue but noted modest near‑term integration impacts.
• Management acknowledged gross‑margin headwinds from increased hyperscaler and LLM/consumption costs and flagged up to ~50 basis points potential operating‑margin pressure from recent acquisitions in 2026, though they expect to offset much of this over time.

ServiceNow Stock Performance

NOW traded down $14.24 on Thursday, hitting $115.38. 13,665,748 shares of the company’s stock were exchanged, compared to its average volume of 13,061,109. The firm has a market cap of $119.81 billion, a PE ratio of 69.62, a P/E/G ratio of 2.27 and a beta of 0.98. ServiceNow has a twelve month low of $114.90 and a twelve month high of $211.48. The stock has a fifty day moving average of $151.58 and a two-hundred day moving average of $171.79. The company has a current ratio of 1.06, a quick ratio of 1.06 and a debt-to-equity ratio of 0.13.

ServiceNow News Roundup

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: Beat Q4 estimates and raised 2026 subscription guidance — the core fundamental news that supports longer‑term growth expectations and the stock’s premium multiple. MarketWatch: Q4 results and guidance
• Positive Sentiment: Board authorized an additional $5B buyback (including $2B accelerated) — meaningful shareholder return that reduces float and can support the share price. BusinessWire: $5B buyback
• Positive Sentiment: Expanded AI partnerships (Anthropic, OpenAI) and customer wins (Fiserv, Panasonic Avionics) — strengthens AI monetization narrative and product differentiation. BusinessWire: Anthropic partnership
• Positive Sentiment: Multiple brokers reaffirm Buy ratings and raised/maintained price targets (BTIG $200, Needham $155, UBS $170) — signals continued analyst conviction in multi‑year growth and valuation premium. Benzinga: Analyst notes
• Neutral Sentiment: Unusually large call option activity — could reflect speculative hedging or directional bets around post‑earnings volatility rather than a directional consensus.
• Neutral Sentiment: CEO publicly bought stock and committed to staying through 2030 — supportive signal of insider confidence but not a near‑term operational catalyst by itself. Business Insider: CEO buy
• Negative Sentiment: Shares sold off after the print — investors parsed the subscription revenue details and judged the outlook or cadence of growth as less than transformative, prompting profit‑taking in a weak software tape. Blockonomi: post‑earnings selloff
• Negative Sentiment: Market commentary highlights “iffy” subscription revenue forecast and AI disruption fears for legacy software players — sentiment pressure that can outweigh near‑term fundamental beats. SiliconANGLE: subscription concerns
• Negative Sentiment: BMO trimmed its price target slightly (175→170) — a modest negative signal from a sell‑side desk even though the rating remains positive.

Insider Buying and Selling

In related news, CFO Gina Mastantuono sold 2,085 shares of the business’s stock in a transaction that occurred on Friday, November 28th. The stock was sold at an average price of $161.60, for a total transaction of $336,936.00. Following the completion of the transaction, the chief financial officer owned 63,215 shares in the company, valued at $10,215,544. The trade was a 3.19% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, insider Paul Fipps sold 1,525 shares of the company’s stock in a transaction on Tuesday, November 18th. The stock was sold at an average price of $163.51, for a total value of $249,352.75. Following the transaction, the insider owned 2,705 shares of the company’s stock, valued at approximately $442,294.55. The trade was a 36.05% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 15,310 shares of company stock valued at $2,533,585 over the last 90 days. 0.34% of the stock is owned by corporate insiders.

Institutional Trading of ServiceNow

Several hedge funds have recently bought and sold shares of the company. Wealth Watch Advisors INC bought a new position in ServiceNow in the 3rd quarter worth about $29,000. Kelleher Financial Advisors bought a new stake in shares of ServiceNow during the third quarter valued at approximately $50,000. Pin Oak Investment Advisors Inc. increased its position in ServiceNow by 20.7% in the 3rd quarter. Pin Oak Investment Advisors Inc. now owns 134 shares of the information technology services provider’s stock valued at $123,000 after acquiring an additional 23 shares during the period. Jupiter Wealth Management LLC bought a new stake in ServiceNow during the 2nd quarter valued at $154,000. Finally, Turning Point Benefit Group Inc. acquired a new position in ServiceNow during the 3rd quarter worth $194,000. 87.18% of the stock is currently owned by institutional investors.

Analysts Set New Price Targets

Several research firms recently commented on NOW. Barclays boosted their price target on ServiceNow from $242.00 to $245.00 and gave the stock an “overweight” rating in a research note on Thursday, October 30th. Wall Street Zen raised ServiceNow from a “hold” rating to a “buy” rating in a research report on Saturday, December 27th. TD Cowen reissued a “buy” rating on shares of ServiceNow in a research report on Tuesday, January 20th. The Goldman Sachs Group lowered shares of ServiceNow from a “buy” rating to a “sell” rating in a research note on Monday, January 12th. Finally, Weiss Ratings reiterated a “hold (c)” rating on shares of ServiceNow in a research note on Thursday, January 22nd. Two equities research analysts have rated the stock with a Strong Buy rating, thirty-two have assigned a Buy rating, six have issued a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and a consensus target price of $197.41.

ServiceNow Company Profile

ServiceNow (NYSE: NOW) is a cloud computing company that builds enterprise software to manage digital workflows and automate business processes. Its offerings are designed to replace manual work and legacy systems with cloud-based, service-oriented applications that support IT operations, customer service, human resources, security response and other enterprise functions.

The company’s flagship product family is the Now Platform, a suite of subscription software and platform services that includes IT Service Management (ITSM), IT Operations Management (ITOM), IT Business Management (ITBM), Customer Service Management (CSM), HR Service Delivery, Security Operations and Asset Management.