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ServiceNow Reports Fourth Quarter and Full-Year 2024 Financial Results; Board of Directors Authorizes Additional $3B for Share Repurchase Program

ServiceNow (NYSE: NOW), the AI platform for business transformation, today announced financial results for its fourth quarter ended December 31, 2024, with subscription revenues of $2,866 million in Q...

Business Wire
  • Subscription revenues of $2,866 million in Q4 2024, representing 21% year-over-year growth, 21% in constant currency
  • Total revenues of $2,957 million in Q4 2024, representing 21% year-over-year growth, 21% in constant currency
  • Current remaining performance obligations of $10.27 billion as of Q4 2024, representing 19% year-over-year growth, 22% in constant currency
  • Remaining performance obligations of $22.3 billion as of Q4 2024, representing 23% year-over-year growth, 26% in constant currency
  • Nearly 500 customers with more than $5 million in ACV, representing 21% year-over-year growth
  • ServiceNow's Board of Directors authorizes additional repurchases of up to $3 billion of common stock under share repurchase program with the primary objective of managing the impact of dilution

SANTA CLARA, Calif.: ServiceNow (NYSE: NOW), the AI platform for business transformation, today announced financial results for its fourth quarter ended December 31, 2024, with subscription revenues of $2,866 million in Q4 2024, representing 21% year-over-year growth and 21% in constant currency.

“ServiceNow closed out the year exceeding Q4 expectations on top of our ‘beat and raise’ track record,” said ServiceNow Chairman and CEO Bill McDermott. “AI is fueling a top to bottom re-ordering of the enterprise technology landscape. Leaders are embracing the ServiceNow Platform as their AI agent control tower to unlock exponential productivity and seamlessly orchestrate end-to-end business transformation. We are still in the early days of a massive opportunity. ServiceNow’s innovation, growth, and profitability put us in a class of one.”

As of December 31, 2024, current remaining performance obligations (“cRPO”), contract revenue that will be recognized as revenue in the next 12 months, was $10.27 billion, representing 19% year-over-year growth and 22% in constant currency. The company now has 2,109 customers with more than $1 million in annual contract value (“ACV”), representing 12% year-over-year growth in customers, and nearly 500 customers with more than $5 million in ACV, representing 21% year-over-year growth.

“Q4 was a great quarter, capping a year of incredible innovation and execution,” said ServiceNow President and CFO Gina Mastantuono. “Our GenAI net new ACV stepped up meaningfully in Q4, as the number of Now Assist service desk deals grew over 150% quarter-over-quarter. We’re just scratching the surface of what’s possible. The moves we’re making in 2025 aren’t just about maintaining our lead—they’re about expanding it. We are setting ourselves up to define the future of agent-powered automation, solidify ServiceNow as the AI Platform for Business Transformation, and deliver strong growth year after year.”

Recent Business Highlights

Innovation

  • Building on its leadership position in AI, ServiceNow today announced the latest breakthrough in the ServiceNow Platform, positioning it as the AI agent control tower. These innovations—a powerful new AI Agent Orchestrator to harmonize teams of AI agents working across tasks, systems, and departments, thousands of pre-built AI agents for every workflow, plus the new AI Agent Studio for building fully customized AI agents—will be available in March 2025 as part of ServiceNow’s Pro Plus and Enterprise Plus offerings to help accelerate enterprise AI agent adoption. As part of the single, trusted ServiceNow Platform, these capabilities build on the company's two-decade expertise driving exponential productivity across every person and every process by handling complex and ambiguous tasks that traditional automation cannot solve.
  • During the quarter, ServiceNow continued to advance its innovation roadmap, releasing more than 150 new GenAI innovations for autonomous, responsible AI on the ServiceNow Platform. This included expanded capabilities to drive greater visibility and controls with an AI Governance tool for secure and compliant AI practices, multilingual support, and purpose-built GenAI solutions for configuration management, contract management, legal services, and health and safety.

Partnerships and Acquisitions

  • ServiceNow continues to partner with leading companies to accelerate customers’ AI transformation, today announcing the latest expansions to its technology partner ecosystem.
    • ServiceNow and Google Cloud will broaden their partnership to launch ServiceNow on Google Cloud Marketplace and Google Distributed Cloud, as well as integrate ServiceNow Workflow Data Fabric and cross-enterprise workflows with Google Cloud AI’s infrastructure, development platforms, and productivity tools, to address demand from private- and public-sector enterprises.
    • ServiceNow and Oracle will expand ServiceNow's Workflow Data Fabric capabilities through an integration with Oracle data sources, turning insights into action for enhanced decision-making and agility.
    • ServiceNow and SoftwareOne Holding AG entered a multi-year strategic partnership to empower mutual customers to maximize the ROI of their software and cloud investments.
    • ServiceNow and Visa expanded their strategic alliance to streamline costly, lengthy payment card dispute resolutions for financial institutions worldwide.
  • Additional partnerships during the quarter included:
    • ServiceNow and ASDA with an expanded collaboration to improve employee and shopper experiences by uniting operations across technology, customer, and employee workflows.
    • ServiceNow and AWS with new capabilities to accelerate AI transformation.
    • ServiceNow and Five9 with a turnkey AI-powered solution for unified employee and customer experiences.
    • ServiceNow and Microsoft with a vision to modernize the front-office with Microsoft Copilot and ServiceNow AI Agents, leveraging the unique strengths of both platforms to solve customer problems.
  • Earlier in January, ServiceNow announced its acquisition of AI-native conversation data analysis platform Cuein, which will advance the development of next generation AI agents on the ServiceNow Platform.
  • In Q4, the company also acquired Mission Secure to strengthen operational technology (OT) services for customers in industrial markets and provide them with increased visibility and context into their OT environments, improving decision-making and reducing downtime.

Investment

  • Given ServiceNow’s strong cash position and its strategy of managing the impact of dilution, the Board of Directors authorized additional repurchases of up to $3 billion of common stock under its share repurchase program.1
  • ServiceNow repurchased approximately 293,000 shares of its common stock for $296 million as part of its share repurchase program, with the primary objective of managing the impact of dilution. Of the original authorized amount of $1.5 billion, approximately $266 million remains available for future share repurchases.

Recognition

Executive Leadership

  • As ServiceNow continues to scale and sharpen its focus on strategic growth, its executive leadership team is essential to realizing its position as the enterprise AI leader. Therefore, the company is announcing the following executive role expansions: Gina Mastantuono as president and chief financial officer; Chris Bedi as chief customer officer and special advisor to the chairman for AI transformation; Paul Smith as president of global customer and field operations; Jacqui Canney as chief people and AI enablement officer; and Nick Tzitzon as vice chair.

(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, “Magic Quadrant for the CRM Customer Engagement Center,” by Pri Rathnayake, Drew Kraus, Wynn White, December 11, 2024.

(3)

Gartner, Inc., “Magic Quadrant for Artificial Intelligence Applications in IT Service Management,” by Chris Matchett, Rich Doheny, Chris Laske, Ankita Hundal, October 9, 2024.

(4)

Forrester Research, “The Forrester Wave™: Task-Centric Automation Software, Q4 2024,” by Bernhard Schaffrik with Pascal Matzke, Faith Born, Kara Hartig, December 5, 2024.

(5)

©2025 Fortune Media IP Limited. All rights reserved. Used under license. Fortune is a registered trademark and Fortune World’s Most Admired Companies™ is a trademark of Fortune Media IP Limited and are used under license. Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse the products or services of, ServiceNow.

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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 www.forrester.com/about-us/objectivity/.

Fourth Quarter 2024 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the fourth quarter 2024:

 

 

 

 

 

 

Fourth Quarter 2024 GAAP Results

Fourth Quarter 2024 Non-GAAP Results(1)

 

Amount
($ millions)

Year/Year
Growth (%)

Amount
($ millions)(3)

Year/Year
Growth (%)

Subscription revenues

$2,866

21%

$2,859

21%

Professional services and other revenues

$91

26%

$91

26.5%

Total revenues

$2,957

21%

$2,950

21%

 

 

 

 

 

 

Amount
($ billions)

Year/Year
Growth (%)

Amount
($ billions)(3)

Year/Year
Growth (%)

cRPO

$10.27

19%

$10.49

22%

RPO

$22.3

23%

$22.7

26%

 

 

 

 

 

 

Amount
($ millions)

Margin (%)

Amount
($ millions)(2)

Margin (%)(2)

Subscription gross profit

$2,330

81%

$2,416

84.5%

Professional services and other gross (loss) profit

($4)

(4%)

$7

8.5%

Total gross profit

$2,326

79%

$2,423

82%

Income from operations

$374

13%

$872

29.5%

Net cash provided by operating activities

$1,635

55%

 

 

Free cash flow

 

 

$1,400

47.5%

 

 

 

 

 

 

Amount
($ millions)

Earnings per
Basic/Diluted
Share ($)

Amount
($ millions)(2)

Earnings per
Basic/Diluted
Share ($)(2)

Net income

$384

$1.86 / $1.83

$769

$3.72 / $3.67

 

(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.

Full-Year 2024 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the full-year 2024:

 

 

 

 

 

 

Full-Year 2024 GAAP Results

Full-Year 2024 Non-GAAP Results(1)

 

Amount
($ millions)

Year/Year
Growth (%)

Amount
($ millions)(3)

Year/Year
Growth (%)

Subscription revenues

$10,646

23%

$10,639

22.5%

Professional services and other revenues

$338

16%

$337

16%

Total revenues

$10,984

22%

$10,976

22.5%

 

 

 

 

 

 

Amount
($ billions)

Year/Year
Growth (%)

Amount
($ billions)(3)

Year/Year
Growth (%)

cRPO

$10.27

19%

$10.49

22%

RPO

$22.3

23%

$22.7

26%

 

 

 

 

 

 

Amount
($ millions)

Margin (%)

Amount
($ millions)(2)

Margin (%)(2)

Subscription gross profit

$8,704

82%

$9,038

85%

Professional services and other gross (loss) profit

($7)

(2%)

$39

11.5%

Total gross profit

$8,697

79%

$9,077

82.5%

Income from operations

$1,364

12%

$3,254

29.5%

Net cash provided by operating activities

$4,267

39%

 

 

Free cash flow

 

 

$3,455

31.5%

 

 

 

 

 

 

Amount
($ millions)

Earnings per
Basic/Diluted
Share ($)

Amount
($ millions)(2)

Earnings per
Basic/Diluted
Share ($)(2)

Net income

$1,425

$6.92 / $6.84

$2,902

$14.10 / $13.92

 

(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, and the table entitled “GAAP to Non-GAAP Reconciliation” for a reconciliation of GAAP to 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.

Since September 30, 2024, ServiceNow has seen an incremental strengthening of the U.S. dollar, resulting in a foreign exchange (“FX”) headwind of approximately $175 million for 2025 subscription revenues, which includes $40 million in Q1 2025, and $205 million for Q1 2025 cRPO.

Our guidance assumes a more pronounced second-half weighted linearity in our U.S. Federal business due to seasonality from the change in presidential administration.

In 2025, we will begin shifting more of our business model to include elements of consumption-based monetization across our AI and data solutions. For instance, we will include our new AI Agents in our Pro Plus and Enterprise Plus SKUs, forgoing upfront incremental new subscriptions to instead drive accelerated adoption and monetize increasing usage over time. We are also optimizing certain aspects of our go-to-market approach and creating more integrated solutions that we will announce at Knowledge 2025. Our guidance prudently reflects the flexibility to make these moves while delivering further free cash flow generation. Our free cash flow margin guidance reflects incremental expansion, building on the accelerated trajectory driven by our 2024 outperformance.

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

 

First Quarter 2025
GAAP Guidance

 

First Quarter 2025
Non-GAAP Guidance(1)

 

Amount
($ millions)(3)

Year/Year
Growth (%)(3)

 

Constant Currency
Year/Year Growth (%)

Subscription revenues

$2,995 - $3,000

18.5% - 19%

 

19.5% - 20%

 

 

 

 

 

cRPO

 

19.5%

 

20.5%

 

 

 

 

 

 

 

 

 

Margin (%)(2)

Income from operations

 

 

 

30%

 

 

 

 

 

 

 

Amount
(millions)

 

 

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

 

210

 

 

 

(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 Fina

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