Servicenow, Inc. · NYSE:NOW
Servicenow — Q1 2025 Earnings Presentation
25 slides from Servicenow's earnings presentation, Apr 23, 2025
Slide 1: Investor Presentation First Quarter 2025
Investor Presentation First Quarter 2025
Slide 2: Safe Harbor and other information
Safe Harbor and other information This presentation contains “forward‐looking” statements that are based on our management’s beliefs and assumptions and on information currently available to management. Forward‐looking statements include information concerning our possible or assumed strategy, futur
Slide 3: Statement Regarding Use of Non-GAAP Financial Measures
Statement Regarding Use of Non-GAAP Financial Measures 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. We adjust revenues and related growth rates (“revenues”), and current remaining performance
Slide 4: ServiceNow Platform
Technology Core Business CRM and Industry Creator Workflows Workflows Workflows Workflows Provides easy-to-follow Build connected cross- processes across HR, Intelligently orchestrate enterprise workflow Accelerate digital Procurement, Facilities, customer experiences apps fast using low- transforma
Slide 5: We are the AI Platform for Business Transformation
We are the AI Platform for Business Transformation We move with the pace of Our approximately 8,400 global innovation to help customers customers(1) include over 85% of transform organizations across the Fortune 500. They all rely on Our aspiration is to be the every industry while upholding a Servi
Slide 6: Q1-25 Financial Highlights
Q1-25 Financial Highlights Increase Non-GAAP Constant Q1 2025 Results Quarterly Results Currency Impact(1) (Decrease) Y/Y Currency Y/Y(2) Subscription Revenues $3,005M 19% ~100bps headwind 20% Current RPO (cRPO) $10.31B 22% ~Flat 22% Remaining Performance Obligations (RPO) $22.1B 25% ~Flat 25.5% Non
Slide 7: 2025 Guidance Assumptions
2025 Guidance Assumptions 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 benefit
Slide 8: Guidance Summary
Guidance Summary Currency Impact Increase Non-GAAP Constant Q2 2025 Guidance Quarterly Guidance Included in (Decrease) Y/Y Currency Y/Y(2) Guidance(1) Subscription Revenues $3,030M - $3,035M 19% - 19.5% ~Flat 19.5% Non-GAAP Operating Margin(3) 27% ~(50bps) NA NA Current RPO (cRPO) Growth 19.5% NA ~F
Slide 9: Comparison to Previously Issued Guidance
Comparison to Previously Issued Guidance $2,998 $9 $3,005 $12,655 $39 $12,660 $(2) $(34) ($M) Subscription Revenues Y/Y Growth 19% 19% 19% 19% Q1-25A FY25E Prev. Guidance Midpoint(1) Currency Impact(2) Q1 Performance Actual Results Guidance Change Current Guidance Midpoint (1) Refers to previously i
Slide 10: Year-Over-Year Subscription Revenues Growth
Year-Over-Year Subscription Revenues Growth Subscription Revenues (%) 27% 27% 26% 24% 25% 24% 25% 23% 23% 23% 22% 25% 23% 23% 21% 21% 19% 20% Q1-24A Q2-24A Q3-24A Q4-24A Q1-25A FY24A Previous Year Growth Actual Growth Non-GAAP Constant Currency Sub Revenue Growth (1) (1) Non-GAAP subscription revenu
Slide 11: Currency Impact to Year-Over-Year Sub. Revenues
Currency Impact to Year-Over-Year Sub. Revenues Subscription Revenues ($M) $2,866 $2,859 $3,005 $3,031 $10,646 $10,639 $2,523 $2,517 $2,542 $2,552 $2,715 $2,711 … $(7) $26 $(6) $10 $(4) $(7) Q1-24A Q2-24A Q3-24A Q4-24A Q1-25A FY24A Y/Y 25% 24% 23% 23% 23% 22% 21% 21% 19% 20% 23% 23% Growth Actuals C
Slide 12: Remaining Performance Obligations (RPO)
Remaining Performance Obligations (RPO) ($B) Current RPO Noncurrent RPO Q1-25 $22.3 $22.1 Y/Y $18.6 $19.5 Growth $17.7 +25% / +25.5% cc(1) $12.0 $11.8 $10.2 Total RPO $9.2 $9.8 $8.45 $8.78 $9.36 $10.27 $10.31 Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 cRPO Y/Y Growth 20.5% 22% 26% 19.5% 22% cRPO cc(1) Y/Y 21% 22
Slide 13: Customer Cohort Growth
Customer Cohort Growth Annual Growth of Initial ACV 2025 44% 53% 2024 52% 54% 2023 71% 2022 84% 77% 2021 75% 2020 105% 2019 121% 2018 2017 115% 2016 164% 2015 2014 170% 2013 2012 226% 2011 2010 258% (1) (1) As an illustrative example, 2010 customer cohort started with a contract of initial ACV (annu
Slide 14: Expansion of Customer Relationships
Expansion of Customer Relationships ($M) $14.0 $14.2 $13.5 $13.7 $13.0 $13.2 $12.5 $12.7 $12.3 498 508 461 441 413 425 382 360 345 Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 Number of Customers with $5M+ ACV Avg ACV of Customers with $5M+ ACV Note: Previously disclosed number of customers
Slide 15: Renewal Rate
Renewal Rate 98% 98% 98% 98% 98% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 Note: We adjust our Renewal Rate for acquisitions, consolidations and other customer events that cause the merging of two or more accounts occurring at the time of renewal. © 2025 ServiceNow, Inc. All Rights Reserved. 15
Slide 16: Net New ACV Contribution Across Workflows and Products
Net New ACV Contribution Across Workflows and Products (1) Technology Workflows CRM and Industry & Core Business Workflows Creator Workflows & Others 18% 17% 15% 18% 18% 30% 29% 31% 30% 34% 52% 54% 54% 52% 48% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 (1) Historical presentations disclosed net new ACV contribut
Slide 17: GAAP Revenues by Geography
GAAP Revenues by Geography North America EMEA APAC & Other 11% 12% 11% 11% 11% 26% 25% 25% 27% 25% 63% 63% 64% 62% 64% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 © 2025 ServiceNow, Inc. All Rights Reserved. 17
Slide 18: Headcount by Department
Headcount by Department PS & Other Cost of Sales Sub. Cost of Sales S&M R&D G&A 26,293 26,698 25,743 24,469 23,362 3,133 3,231 3,086 2,992 2,886 8,393 8,583 8,640 7,912 7,520 9,008 9,083 9,219 8,209 8,585 3,853 4,063 4,351 4,583 4,749 894 917 905 911 859 Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 © 2025 ServiceN
Slide 19: Non-GAAP Gross Margins
Non-GAAP Gross Margins Non-GAAP Subscription Gross Margin 85.5% 85.0% 85.0% 85.0% 84.5% 84.5% 84.5% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 FY23 FY24 Non-GAAP PS & Other Gross Margin 15.5% 15.5% 7.5% 8.5% 9.5% 11.5% 4.0% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 FY23 FY24 Non-GAAP Total Gross Margin 83.5% 82.5% 82.5% 82.
Slide 20: Non-GAAP Operating and Free Cash Flow Margins
Non-GAAP Operating and Free Cash Flow Margins Non-GAAP Operating Margin 30.5% 31.0% 29.5% 31.0% 29.5% 27.5% 27.5% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 FY23 FY24 Non-GAAP Free Cash Flow Margin 47.0% 47.5% 48.0% 30.5% 31.5% 17.0% 13.5% Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 FY23 FY24 Note: All figures are calculated
Slide 21: Non-GAAP Net Income and Diluted EPS
Non-GAAP Net Income and Diluted EPS Non-GAAP Net Income ($M) $2,902 $2,215 $707 $775 $769 $846 $651 Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 FY23 FY24 Non-GAAP Diluted EPS $13.92 $10.78 $3.41 $3.72 $3.67 $4.04 $3.13 Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 FY23 FY24 Note: All figures are calculated on a non-GAAP basis. S
Slide 22: GAAP to Non-GAAP Reconciliation and Supplemental Information
GAAP to Non-GAAP Reconciliation and Supplemental Information © 2025 ServiceNow, Inc. All Rights Reserved. 22
Slide 23: GAAP to Non-GAAP Reconciliation – Other
GAAP to Non-GAAP Reconciliation – Other in millions (except %'s and per share data) 2023 Margin Q1'24 Margin Q2'24 Margin Q3'24 Margin Q4'24 Margin 2024 Margin Q1'25 Margin Q2'25E Margin 2025E Margin GAAP Subscription Gross Profit $ 7,074 81.5% $ 2,082 82.5% $ 2,073 81.5% $ 2,219 81.5% $ 2,330 81.5%
Slide 24: Supplemental Information
Supplemental Information in millions Q1'24 Q2'24 Q3'24 Q4'24 2024 Q1'25 Stock-based compensation Cost of revenues: Subscription $ 58 $ 62 $ 64 $ 66 $ 250 $ 68 Professional services and other $ 12 $ 12 $ 11 $ 11 $ 46 $ 11 Operating expenses: Sales and marketing $ 134 $ 141 $ 144 $ 146 $ 565 $ 148 Res
Slide 25: servicenow.
servicenow.