Investing.com -- ServiceNow reported better-than-expected third-quarter results helped by strong demand for its AI-driven workflow tools. Shares rose 5% in extended trading.

The enterprise software maker said earnings rose to $4.82 a share, beating analyst estimates of $4.26. Revenue grew 22% from a year earlier to $3.41 billion, topping forecasts of $3.35 billion. Subscription revenue, its main business line, climbed 21.5% to $3.30 billion.

ServiceNow said it exceeded guidance across all topline and profitability metrics and now expects higher subscription revenue, operating margin and free cash flow for 2025. The company forecasts fourth-quarter subscription revenue between $3.42 billion and $3.43 billion.

Chief Executive Bill McDermott said the quarter showed ServiceNow’s strength as an AI platform for business transformation, citing broad adoption across industries.

The company’s current remaining performance obligations rose 21% to $11.35 billion, while total remaining performance obligations increased 24% to $24.3 billion.

President and Chief Financial Officer Gina Mastantuono said growth was broad-based, with strong results in its U.S. Federal business and new AI products such as Now Assist and Workflow Data Fabric.

ServiceNow’s board approved a five-for-one stock split, subject to shareholder approval at a meeting scheduled for Dec. 5.

The company cautioned that U.S. Federal agencies are facing tighter budgets and potential deal-timing effects from the recent government shutdown, which could influence fourth-quarter results.