With a market cap of $150.6 billion, ServiceNow, Inc. (NOW) provides cloud-based digital workflow solutions through its AI-powered Now Platform that enables machine learning, robotic process automation, process mining, analytics, and low-code/no-code development tools. Serving multiple industries across North America, EMEA, and Asia-Pacific, it offers a broad portfolio of IT and non-IT products, helping enterprises streamline operations, enhance productivity, and optimize total cost of ownership.
The Santa Clara, California-based company is slated to announce its fiscal Q1 2025 earnings results after the market closes on Wednesday, Apr. 23. Ahead of this event, analysts expect ServiceNow to report a profit of $2.01 per share, a 10.4% growth from $1.82 per share in the year-ago quarter. It has exceeded Wall Street’s earnings expectations in the past four quarters. In Q4 2024, NOW beat the consensus EPS estimate by a 10.9% margin.
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For fiscal 2025, analysts expect the business software specialist to report EPS of $8.93, an increase of 24% from $7.20 in fiscal 2024. In addition, EPS is anticipated to grow 28.8% year-over-year to $11.50 in fiscal 2026.
Shares of ServiceNow have declined 7.4% over the past 52 weeks, lagging behind the broader S&P 500 Index's ($SPX) 4.2% dip. However, the stock experienced a smaller decline than the Technology Select Sector SPDR Fund's (XLK) 12.8% drop over the same period.
Despite reporting better-than-expected Q4 2024 adjusted EPS of $3.67 and revenue of around $3 billion on Jan. 29, shares of NOW tumbled 11.4% the next day as the company issued weaker-than-expected Q1 and full-year 2025 subscription revenue. In addition, current remaining performance obligations (cRPO) grew 21% to $10.3 billion but slightly missed the target.
Moreover, the stock fell 2.7% on Mar. 26 after Baird cut its price target to $1,010 per share despite maintaining an "outperform" rating. Scotiabank's similar recent price target cut added to investor jitters. Worries over the $2.85 billion AI firm Moveworks acquisition also pressured the stock.
Analysts' consensus view on ServiceNow stock remains bullish, with a "Strong Buy" rating overall. Out of 38 analysts covering the stock, 30 recommend a "Strong Buy," three "Moderate Buys," four give a "Hold" rating, and one "Strong Sell." This configuration is more bullish than three months ago, with 28 analysts suggesting a "Strong Buy." As of writing, NOW is trading below the average analyst price target of $1,110.54.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
