Core Viewpoint - ServiceNow's stock experienced a significant decline, dropping over 11% to a low of $115.01, marking an eight-year low, despite reporting strong fourth-quarter subscription revenue growth and earnings that exceeded market expectations [1] Financial Performance - In Q4, ServiceNow's subscription revenue grew by 21% year-over-year to $3.47 billion [1] - The adjusted earnings per share (EPS) was reported at $0.92, surpassing market forecasts [1] - The number of customers with annual contract values exceeding $5 million increased from 553 to 603 compared to the previous quarter [1] Market Sentiment - Investor concerns are rising regarding the impact of generative AI on the industry, which may threaten ServiceNow's market position [1] - Analyst Matthew Hedberg from RBC Capital Markets noted that despite the financial results being in line with or better than expectations, the stock price decline was unexpected, indicating a significant divergence in market valuation logic for the software industry [1]

Core Insights - Premarket trading is showing notable activity with significant price movements indicating potential trading opportunities before the market opens [1] Premarket Gainers - Serina Therapeutics, Inc. (SER) increased by 52% to $4.13 - Digital Currency X Technology Inc. (DCX) rose by 37% to $4.21 - Virtuix Holdings Inc. Class A Common Stock (VTIX) gained 31% to $14.00 - Venu Holding Corporation (VENU) saw a 25% increase to $6.45 - TRX Gold Corporation (TRX) was up 18% to $2.29 - Korro Bio, Inc. (KRRO) increased by 17% to $13.69 - Check-Cap Ltd. (MBAI) rose by 15% to $2.40 - Namib Minerals (NAMM) gained 14% to $7.35 - Austin Gold Corp. (AUST) increased by 11% to $2.84 - SuperX AI Technology Limited (SUPX) was up 9% to $19.12 [3] Premarket Losers - Inuvo, Inc. (INUV) decreased by 26% to $2.42 - Comstock Inc. (LODE) fell by 16% to $2.95 - Joby Aviation, Inc. (JOBY) dropped 14% to $11.40 - ENvue Medical, Inc. (FEED) declined by 12% to $2.02 - Whirlpool Corporation (WHR) was down 10% to $72.25 - USA Rare Earth, Inc. (USAR) decreased by 10% to $22.66 - ServiceNow, Inc. (NOW) fell by 9% to $117.41 - Pinnacle Food Group Limited (PFAI) dropped 9% to $2.15 - BiomX Inc. (PHGE) decreased by 8% to $5.91 - Vyome Holdings, Inc. (HIND) was down 8% to $2.32 [4]

Core Viewpoint - ServiceNow's stock price has declined significantly following the release of its financial results, raising questions about whether to buy the dip or sell the rip [1] Financial Performance - ServiceNow reported fourth quarter revenue of $3.56 billion, a 21% increase from the same period in 2024, leading to an annual revenue of $13 billion, up 20% from 2024 [1] - The company's current remaining performance obligations (cRPO) rose to over $12 billion [1] - Guidance for Q1 revenue is projected between $3.65 billion and $3.655 billion, with an expected operating margin of 31.5% [1] - For the full year, revenue is expected to increase by 20.5% to 21%, reaching between $15.3 billion and $15.57 billion, which is below analysts' expectations of $15.7 billion [1] Valuation Metrics - The forward price-to-earnings ratio has decreased to 37.8, significantly lower than the five-year average of 67 [1] - The GAAP price-to-earnings ratio stands at 75, also below the five-year average of 252 [1] - The forward PEG ratio is 1.64, slightly lower than the sector median of 1.65 [1] Analyst Sentiment - Wall Street analysts maintain an optimistic outlook, with a consensus target price of $204, indicating a potential 57% increase from the current level [1] - Target prices from analysts include $200 from Cantor Fitzgerald and $175 from Jefferies, while only one analyst, Kash Rangan from Goldman Sachs, has downgraded the stock from buy to sell [1] Technical Analysis - The stock has been in a downward trend, falling from a high of $240 in January 2025 to $122 [1] - It has breached the 61.8% Fibonacci Retracement level at $133.45 and remains below key moving averages [1] - The Relative Strength Index (RSI) and MACD indicators show continued downward movement, suggesting further declines may target the next support level at $105 [1]

Core Viewpoint - ServiceNow's stock experienced a decline despite the company reporting better-than-expected quarterly results and providing a positive outlook for its earnings [1] Group 1 - The quarterly results exceeded market expectations, indicating strong performance in the software sector [1] - The company provided an optimistic outlook for future earnings, suggesting continued growth potential [1]

Market Analysis by covering: ServiceNow Inc. Read 's Market Analysis on Investing.com ...

Core Viewpoint - ServiceNow continues to demonstrate strong financial performance and growth potential in the IT services industry, despite a recent drop in share price following its earnings report [1][4]. Financial Performance - ServiceNow reported an earnings per share (EPS) of $0.92, surpassing the estimated $0.88 and the Zacks Consensus Estimate of $0.87, marking a year-over-year improvement from $0.73 [2][6]. - The company's revenue for the quarter was $3.56 billion, exceeding the estimated $3.52 billion and the Zacks Consensus Estimate by 1.24%, reflecting a significant increase from $2.96 billion in the same period last year [3][6]. Market Position and Growth Outlook - Despite a more than 5% drop in shares post-earnings announcement, the company remains optimistic about future growth, projecting higher-than-anticipated subscription revenue for 2026 [4][6]. - Strategic acquisitions, including plans to acquire startups Armis and Veza, are expected to enhance ServiceNow's capabilities in artificial intelligence and security [4]. Valuation Metrics - ServiceNow's financial metrics indicate a strong valuation, with a price-to-earnings (P/E) ratio of approximately 77.88 and a price-to-sales ratio of 10.63 [5]. - The company's enterprise value to sales ratio is 10.60, and a debt-to-equity ratio of 0.21 suggests a relatively low level of debt, while a current ratio of 1.06 indicates modest short-term financial health [5].

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[music] For a long time now, the enterprise software cohort has just been a house of pain because Wall Street's terrified that they're going to be steamrolled by generative AI platforms that are very good at writing code. But we really haven't seen all that much impact in the actual numbers for these companies. Instead, the enterprise stocks, they've been pummeled by multiple compression.The earnings themselves have been fine, though. Just take a look at Service Now. Here's a stock that peaked exactly one y ...

AI and Automation - ServiceNow's AI Platform facilitates seamless workflows and digital transformation across organizations, enhancing collaboration and productivity[10]. - The company emphasizes the importance of AI in modernizing workflows, with organizations prioritizing AI-powered automation to improve productivity and manage risks[11]. - ServiceNow's platform architecture allows for the integration of AI-enhanced workflows without disrupting existing technology infrastructures, providing a competitive edge in the market[15]. - The Now Assist AI tools enable organizations to boost productivity by offering a range of AI capabilities, including language models and custom AI agents, tailored to specific needs[20]. - AI agents for IT Service Management automate incident triage and provide intelligent resolution recommendations, allowing IT staff to focus on higher-value activities[38]. - Now Assist and AI agents for SOM automate lead qualification and issue resolution, increasing productivity and reducing sales process completion time[56]. - The company is focused on incorporating AI technology into its offerings, which is seen as a key driver for future growth despite associated operational and regulatory challenges[135]. Workflow and Efficiency - The platform's data fabric supports real-time connections to external data sources, enhancing workflow efficiency and delivering context-aware insights[21]. - ServiceNow's acquisition of Moveworks strengthens its enterprise workflow automation capabilities, improving service request handling and information retrieval[22]. - The company's CRM and Industry products streamline end-to-end customer service workflows, significantly reducing response and resolution times, saving employees tens of thousands of hours annually[49]. - Core Business products improve efficiency by automating repetitive HR tasks, significantly reducing HR case volume and resolving over 50% of new cases within the same day[61][62]. - ServiceNow's technology products help organizations optimize IT operations, reduce downtime, and drive down costs, ultimately improving employee and customer experiences[37]. Market Strategy and Growth - The company aims to become the defining AI enterprise software company of the 21st century, guided by its core values and commitment to customer experience[105]. - The company maintains a global partner ecosystem to enhance market reach and co-innovation, including relationships with major technology providers like AWS, Google, and Microsoft[90]. - The company’s marketing strategy includes digital advertising, trade shows, and user conferences to increase market penetration and expand into new geographies[88]. - The company’s growth strategy includes expanding offerings into new and adjacent industries while complying with relevant regulations[133]. - Sales outside of North America represented 37% of total revenues for the years ended December 31, 2025 and 2024[132]. Research and Development - Significant investments in research and development are expected to continue, aimed at expanding platform capabilities and advancing AI and machine intelligence technologies[100]. - The company has over 2,000 issued U.S. and foreign patents and over 580 pending patent applications as of December 31, 2025, indicating a strong focus on intellectual property[96]. Employee and Talent Management - As of December 31, 2025, the company employed 29,187 full-time employees, with 14,601 in the United States and 14,586 internationally[114]. - The company has a total rewards program that includes an annual cash bonus plan and a broad-based discretionary equity incentive program to attract and retain employees[112]. - The company faces intense competition for talent, particularly in technology roles, which could impact its ability to achieve revenue growth[164]. - The company’s ability to attract and retain employees may be adversely affected by failure to meet corporate sustainability goals[180]. Cybersecurity and Risk Management - The company has established comprehensive cybersecurity risk management policies and practices, integrating them into its overall risk management program[204]. - Significant financial and personnel resources have been devoted to cybersecurity, with ongoing investments planned to enhance data security infrastructure[203]. - The company conducts annual cybersecurity risk assessments, utilizing both internal and external information to prioritize security initiatives[206]. - Regular training is provided to employees on cybersecurity topics, including phishing and insider threats, to enhance awareness and response capabilities[211]. - The Board and Audit Committee oversee cybersecurity risk management, receiving regular updates on incidents and risk assessments[214]. - Cybersecurity threats are a growing concern, with increased reliance on third-party providers introducing new risks to business operations[155]. - The company has identified vulnerabilities in its products and services, and delays in developing effective patches could expose it to security risks[156]. - An actual or perceived security breach could lead to significant operational and financial consequences, including loss of sales and reputational damage[161]. - The company has implemented controls for third-party risk management, assessing cybersecurity threats associated with service providers[210]. - Independent cyber maturity assessments were conducted in 2023, 2024, and 2025 to evaluate controls against the NIST Cybersecurity Framework[212]. Financial Performance and Challenges - The company expects a decline in revenue growth rate over the long term due to increasing competition and market saturation[185]. - The effective tax rate may be adversely affected by changes in tax laws, which could materially impact financial results[186]. - The company is subject to ongoing tax audits globally, which may result in significant tax liabilities if positions are challenged[189]. - The company may incur significant implementation costs if customer product implementations are delayed or unsuccessful[179]. - The complexity of government procurement processes may lead to increased expenses and delays in contract awards, impacting financial performance[143]. - The company’s stock price is likely to remain volatile, influenced by various external factors including market conditions and company performance[197]. Legal and Compliance Risks - The company acknowledges that its business model may be impacted by global trends and laws governing AI usage, such as the EU AI Act[137]. - The company faces potential legal and ethical challenges related to AI, including risks of copyright infringement and reputational harm, which could negatively impact customer trust and adoption of AI products[138]. - The use of open-source software poses risks that could harm the company's ability to sell products and services, potentially leading to litigation[178]. - The company may face penalties and sanctions if it fails to comply with global trade laws, which could adversely affect its business operations[149]. Operational Challenges - The company has made substantial investments to support sales to government entities, but the procurement processes are lengthy and may encounter delays, impacting revenue[142]. - The company has seen increased complexity in customer deals, leading to longer sales cycles and greater competition, which may divert resources from other sales opportunities[150]. - The company is expanding its business in heavily regulated industries, which may impose stringent compliance requirements that could restrict business growth[148]. - The company relies on third-party information systems, and delays in improving these systems could negatively impact operations and customer support[170]. - Disruptions or defects in services could lead to substantial liability and harm the company's reputation, potentially resulting in lost revenues[169]. - Delays in product releases or defects may hinder customer adoption and satisfaction, adversely affecting future sales[165].

ServiceNow (NOW) came out with quarterly earnings of $0.92 per share, beating the Zacks Consensus Estimate of $0.87 per share. This compares to earnings of $0.73 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +5.84%. A quarter ago, it was expected that this maker of software that automates companies' technology operations would post earnings of $0.84 per share when it actually produced earnings of $0.96, delivering a surprise ...