NOW Earnings Prediction
The chart below shows how NOW performed 10 days before and after its earnings report, based on data from the past quarters. Typically, NOW sees a -2.09% change in stock price 10 days leading up to the earnings, and a +2.06% change 10 days following the report. On the earnings day itself, the stock moves by -0.81%. This data can give you a slight idea of what to expect for the next quarter's release.
NOW Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
2.96B
21.34%
5.72%
Gross Margin
78.66%
-0.22%
-0.58%
Operating Margin
13.22%
19.31%
-11.51%
Net Margin
12.99%
7.27%
-15.92%
EPS
1.83
27.97%
-11.59%
No Data Available
NOW Earnings Analysis
ServiceNow Inc Corporation (NOW.N) Earnings Conference Call
Positive
Strong Subscription Revenue Growth: Subscription revenue growth was 21%, exceeding the high end of guidance by 50 basis points, demonstrating strong demand for ServiceNow's offerings.
Future Revenue Visibility: Remaining performance obligations (RPO) reached approximately $22.3 billion, representing a 26% year-over-year constant currency growth, indicating robust future revenue visibility.
Customer Renewal Success: The company achieved a 98% renewal rate in Q4, reflecting high customer satisfaction and trust in the ServiceNow platform.
Strong Sales Momentum: ServiceNow closed 170 deals greater than $1 million in net new annual contract value (ACV) during the quarter, including 19 deals exceeding $5 million, showcasing strong sales momentum.
Free Cash Flow Performance: Free cash flow for 2024 totaled $3.5 billion, with a free cash flow margin of 31.5%, highlighting effective cost management and profitability.
Negative
Subscription Revenue Slowdown: Subscription revenue growth was 21%, which, while exceeding guidance, reflects a slowdown compared to previous quarters, indicating potential challenges in sustaining high growth rates.
Operating Margin Decline: Operating margin was 29.5%, which, despite being above guidance, shows a decline from previous quarters, suggesting increasing operational pressures.
2025 Subscription Revenue Guidance: The guidance for 2025 anticipates subscription revenues between $12.635 billion and $12.675 billion, reflecting a more pronounced back half weighted seasonal linearity, indicating potential revenue challenges in the first half of the year.
FX Headwind Impact on Revenue: The company expects an incremental $175 million FX headwind impacting revenue growth, highlighting external economic pressures that could affect performance.
Hybrid Model Transition Challenges: The transition to a hybrid consumption model may lead to short-term headwinds in seat growth as customers adapt, suggesting potential delays in revenue realization from new subscription models.
NOW FAQs
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NOW Earning Call Sentiment
Earnings call transcript: ServiceNow Q4 2024 earnings beat forecast, stock drops
NOW.N
1.54%Positive
ServiceNow's earnings call highlights strong financial performance, with subscription revenue growth exceeding guidance and high operating margins. The company is optimistic about its AI initiatives and partnerships. While there are potential economic and supply chain challenges, the robust share repurchase program and raised revenue guidance indicate confidence. The Q&A section reveals management's positive outlook on AI commoditization and hybrid pricing models, despite some ambiguity in responses. Overall, these factors suggest a positive sentiment, likely leading to a 2% to 8% stock price increase over the next two weeks.
