ServiceNow Revenue Tops Estimates at $4.11 Billion; Adjusted EPS Trails at $1.00

ServiceNow (NYSE: NOW) reported third-quarter revenue of $4.11 billion, above the $4.09 billion analysts expected, and adjusted EPS of $1.00 against the $1.02 consensus estimate, in an 8-K filed Wednesday, Oct. 28. Total revenue rose 20.5% from a year earlier, or 20% in constant currency.

On a GAAP basis, net income was $277 million, or $0.27 a share, down from $502 million, or $0.48 a share, a year earlier. Income from operations was $385 million, compared with $572 million.

Subscription growth

Subscription revenue was $3,988 million, up 21% year over year and 20.5% in constant currency. Professional services and other revenue was $118 million, up 10%.

Backlog and AI bookings

Current remaining performance obligations were $13.65 billion, up 20.5%, and total remaining performance obligations were $29.7 billion, up 22%. The company said it had 19 transactions over $5 million in net new annual contract value in the quarter and ended the period with 680 customers above that threshold.

Chief Financial Officer Gina Mastantuono said the company raised its 2026 AI annual contract value target to $1.7 billion from $1 billion at the start of the year.

Outlook

For the fourth quarter, ServiceNow guided to subscription revenue of $4,245 million to $4,255 million, which it said represents 22.5% to 23% growth on a GAAP basis. For the full year, it guided to subscription revenue of $15,780 million to $15,790 million, and raised its full-year free cash flow margin target by 100 basis points to 36%.

Analysts expected fourth-quarter revenue of $4.36 billion and full-year revenue of $16.22 billion. Those estimates cover total revenue, not subscription revenue alone, so the company's guidance is not directly comparable to them.