ServiceNow (NOW) Tops Q1 EPS by 21c
ServiceNow (NYSE: NOW) reported Q1 EPS of $4.04, $0.21 better than the analyst estimate of $3.83. Revenue for the quarter came in at $3.09 billion versus the consensus estimate of $3.08 billion.
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.
Over the course of Q1, we have seen the U.S. dollar weaken, providing a currency tailwind to our business. We also exceeded the high end of our subscription revenue guidance in the quarter. While our business remains strong, we are only flowing through part of those benefits into our full-year outlook. This allows us to factor in potential risks as they pertain to the current geopolitical environment.
The following table summarizes our guidance for the second quarter 2025:
| Second Quarter 2025 |
| Second Quarter 2025 | |
| Amount | Year/Year |
| Constant Currency |
Subscription revenues | $3,030 - $3,035 | 19% - 19.5% |
| 19.5% |
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cRPO |
| 19.5% |
| 19.5% |
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|
| Margin (%)(2) |
Income from operations |
|
|
| 27% |
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| Amount |
|
|
Weighted-average shares used to compute diluted net income per share |
| 209 |
|
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(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 “Reconciliation of Non-GAAP Financial Guidance” for a reconciliation of GAAP to non-GAAP measures. | |
(3) | Guidance for GAAP subscription revenues and GAAP subscription revenues and cRPO growth rates are based on the 31-day average of foreign exchange rates for March 2025 for entities reporting in currencies other than U.S. Dollars. |
The following table summarizes our guidance for the full-year 2025:
| Full-Year 2025 |
| Full-Year 2025 | |
| Amount | Year/Year |
| Constant Currency |
Subscription revenues | $12,640 - $12,680 | 18.5% - 19% |
| 19.5% |
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| Margin (%)(2) |
Subscription gross profit |
|
|
| 83.5% |
Income from operations |
|
|
| 30.5% |
Free cash flow |
|
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| 32% |
For earnings history and earnings-related data on ServiceNow (NOW) click here.