Beating estimates and expanding partnerships position the company for sustained enterprise demand
ServiceNow (NOW) delivered a strong first-quarter performance, surpassing Wall Street expectations and reinforcing its position as a leader in enterprise software driven by artificial intelligence. The company reported revenue of approximately $3.77 billion, slightly ahead of the $3.74 billion consensus estimate, while adjusted earnings came in at 97 cents per share, narrowly beating forecasts.
Growth remained robust across key segments. Total revenue increased 22% year-over-year, with subscription revenue rising at the same pace, highlighting continued demand for the company’s platform. ServiceNow also reported remaining performance obligations of $27.7 billion, up 25% from the prior year, signaling strong visibility into future revenue streams. Notably, high-value customers are expanding rapidly, with the number of Now Assist clients spending over $1 million annually increasing 130% year-over-year.
CEO Bill McDermott emphasized the company’s leadership in the emerging “agentic enterprise,” where AI-driven automation is transforming business operations. He noted that demand for ServiceNow’s AI capabilities is exceeding internal expectations, positioning the company among the fastest-growing enterprise software providers.
Looking ahead, ServiceNow expects second-quarter subscription revenue between $3.815 billion and $3.82 billion, representing growth of roughly 21% to 21.5%. For the full year, subscription revenue is projected to reach between $15.74 billion and $15.78 billion. While geopolitical tensions in the Middle East have slightly delayed some large deals, management views this as a timing issue rather than a structural concern.
Further strengthening its outlook, ServiceNow announced an expanded partnership with Google Cloud to deliver new AI-powered solutions and autonomous enterprise agents.
With strong fundamentals, accelerating AI adoption, and strategic partnerships, ServiceNow appears well-positioned for continued growth.
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