Last Updated: Jan. 24, 2024 at 8:16 p.m. ET
First Published: Jan. 24, 2024 at 4:21 p.m. ET
ServiceNow Inc.’s stock retreated 1% in after-hours trading Wednesday, after the company reported a quarterly bounce in revenue on strong subscription sales.
“The gen-AI solutions we put into the marketplace in one quarter outsold any other product we put in the market,” ServiceNow NOW Chief Executive Bill McDermott said in an interview Wednesday.
The…
ServiceNow Inc.’s stock retreated 1% in after-hours trading Wednesday, after the company reported a quarterly bounce in revenue on strong subscription sales.
“The gen-AI solutions we put into the marketplace in one quarter outsold any other product we put in the market,” ServiceNow
NOW
Chief Executive Bill McDermott said in an interview Wednesday.
The software company is riding the momentum of a 27% jump in quarterly subscription sales to $2.37 billion, and an aggressive push into artificial intelligence through partnerships with Nvidia Corp.
NVDA
,
Amazon.com Inc.’s
AMZN
AWS and others.
ServiceNow posted fiscal fourth-quarter net income of $295 million, or $1.43 a share, compared with net income of $150 million, or 74 cents a share, in the year-ago quarter. Adjusted earnings were $3.14 a share.
Revenue improved 26% to $2.44 billion, from $1.94 billion in the same quarter a year ago.
Analysts surveyed by FactSet had expected, on average, quarterly adjusted net earnings of $2.78 a share on revenue of $2.4 billion. They forecast $2.3 billion in quarterly subscription sales for ServiceNow.
ServiceNow expects fiscal first-quarter subscription sales of between $2.51 billion and $2.515 billion. Analysts are forecasting $2.54 billion.
Shares of ServiceNow have rocketed 70% over the past 12 months, while the broader S&P 500
SPX
has improved 21.5%.
Analysts characterized the quarter as exceptional.
“Faster-than-expected generative-AI adoption and key partnerships (Visa
V
,
Ernst & Young) position [ServiceNow] for continued success — especially with its robust RPO (remaining performance obligation) metric and ACV (annual contract value), which now exceeds $10 billion,” Daniel Newman, principal analyst and CEO at the Futurum Group, said in an email.
Eugen Boglaru is an AI aficionado covering the fascinating and rapidly advancing field of Artificial Intelligence. From machine learning breakthroughs to ethical considerations, Eugen provides readers with a deep dive into the world of AI, demystifying complex concepts and exploring the transformative impact of intelligent technologies.
