ServiceNow, Inc.
Enterprise Cloud SoftwareFounded 2003- Updated July 2025
Reviewed by Swet Parvadiya
Last reviewed: July 2025
CorpDigest
ServiceNow, Inc.
Financial Performance
Last reviewed: July 2025 · By Swet Parvadiya
Revenue
$13.28B
Market Cap
$116.0B
Net Income
$1.7B
Employees
29,187
Revenue of $13.278 billion in fiscal 2025, with net income of $1.748 billion — a 13.2 percent net margin — reflects a business in transition between the pure subscription model that drove the first decade of growth and the consumption-based AI monetization that management has explicitly guided toward. The 82 percent subscription gross margin on the core platform is the financial foundation; the question is whether the AI consumption pricing expands or compresses the overall margin profile. Revenue growth from $9.0 billion in 2023 to $13.3 billion in 2025 — 48 percent growth over two years — is among the fastest sustained growth rates in enterprise software at this revenue scale. The growth comes from three sources: new customer acquisition, expansion of existing customer ACV through new workflow modules, and price escalation through annual contract renewals. The 98 percent renewal rate means less than 2 percent of ACV is lost to churn annually, creating a revenue base that compounds rather than requiring constant replacement. The $175 million FX headwind for 2025 subscription revenues — cited in 2024 guidance — reflects that 29 percent of revenue is denominated in non-USD currencies, primarily Euro and British Pound Sterling. A 10 percent USD strengthening would reduce operating income by $150 million according to the company's own 10-K sensitivity disclosure. That currency exposure grows with international revenue expansion and represents a meaningful variance factor in reported results. The 2,109 customers with ACV above $1 million — and nearly 500 above $5 million — represent the enterprise customer concentration that produces high renewal rates and expansion revenue, but also the dependency risk that comes when large enterprise customers negotiate multi-year renewal terms during market downturns. The average ACV of the top cohort reaching $5 million means the company's growth increasingly depends on deepening relationships with existing large customers rather than volume expansion from new customers.
Revenue Trend Analysis
YoY Change
+20.9%
2-Year CAGR
+21.7%
Peak Year
2025
Trend
Consistent Growth
ServiceNow, Inc. has reported revenue across 3 fiscal years, compounding at +21.7% annually over 2 years. The most recent year saw a 20.9% increase versus the prior year. Revenue peaked in 2025 at $13.3B. Out of 2 reported periods, 2 showed growth and 0 showed a decline.
| Fiscal Year | Revenue | Net Income | YoY Change |
|---|---|---|---|
| FY2025 | $13.3B | $1.7B | +20.9% |
| FY2024 | $11.0B | — | +22.4% |
| FY2023 | $9.0B | — | — |
Source: SEC EDGAR filings, annual earnings releases, and verified financial disclosures.
Click any row to see year details.
ServiceNow reported full-year 2024 total revenue of approximately $10.98 billion, up 22% from $8.97 billion in 2023, with subscription revenue of approximately $10.65 billion representing approximately 97% of the total. Current remaining performance obligations, the closest analog to subscription backlog, reached approximately $9.95 billion at year-end, up 22% year-over-year and providing strong forward revenue visibility. Subscription gross margin remained at approximately 82% non-GAAP, and consolidated non-GAAP operating margin expanded to approximately 30% from 27% in the prior year. Free cash flow generation reached approximately $3.46 billion for the year, up 25%, demonstrating both subscription revenue durability and operating leverage. GAAP net income was approximately $1.43 billion and non-GAAP net income approximately $3.5 billion. The company added approximately 1,800 net new customers during the year and now serves approximately 8,100 enterprise customers globally including nearly the entire Fortune 500. Average annual contract value continued expanding, with approximately 70 customers paying more than $20 million annually. Market capitalization peaked above $230 billion in late 2024 making ServiceNow one of the most valuable enterprise software companies globally, trading at a premium price-to-sales multiple reflecting durable growth and high free cash flow conversion.
ServiceNow's revenue trajectory has been one of the most consistent at-scale growth stories in enterprise software, expanding from $682 million in fiscal 2014, the first full year after its 2012 IPO, to approximately $10.98 billion in fiscal 2024, a roughly 16x increase over a decade representing a compound annual growth rate of approximately 32%. Annual subscription revenue grew from approximately $549 million in 2014 to $10.65 billion in 2024, while remaining performance obligations expanded from approximately $1.2 billion to over $22 billion, providing multi-year forward visibility. Customer count grew from approximately 2,800 in 2014 to over 8,100 in 2024. The growth was achieved through aggressive sales hiring with approximately 26,000 total employees globally as of recent disclosures, international expansion now contributing roughly 35% of revenue, product line expansion from a single ITSM product to more than 15 workflow modules, increasing average contract values through up-sell and tier upgrades, and consistent renewal rates near 99%. Operating margins expanded from negative GAAP levels in 2014 to mid-teens GAAP and approximately 30% non-GAAP operating margin in 2024, demonstrating significant operating leverage at scale. Free cash flow grew from approximately $159 million in 2014 to $3.46 billion in 2024, an over 20x expansion.
ServiceNow generates strong free cash flow with approximately $3.46 billion in fiscal 2024 against approximately $10.98 billion in revenue, a free cash flow margin of approximately 31%, among the highest in scaled enterprise software. The high cash conversion reflects the multi-year subscription billing model where annual prepayment of contract value funds working capital, the multi-tenant SaaS infrastructure that limits capital expenditure to approximately 5 to 7% of revenue, and disciplined operating cost growth that has expanded margins over time. ServiceNow holds approximately $5.2 billion in cash, equivalents, and short-term investments against approximately $1.5 billion in total debt, primarily senior notes issued at low coupons during the 2020-2021 low-rate period. The company has not paid a dividend, prioritizing reinvestment in product development, sales expansion, and acquisitions. Share repurchases have been used to offset employee stock-based compensation dilution, with approximately $1.5 billion deployed in 2024 against share-based compensation expense of approximately $1.7 billion. The board has authorized cumulative repurchase capacity above $4 billion. Capital allocation prioritizes organic investment, with research and development running approximately 24% of revenue and sales and marketing approximately 38% of revenue, both substantial commitments that fuel sustained 20%+ growth at scale.
ServiceNow trades at one of the highest revenue multiples in scaled enterprise software, with the market capitalization reaching above $230 billion in late 2024 against trailing revenue of approximately $10.98 billion, an implied price-to-sales ratio in the mid-20s and forward EV-to-revenue closer to 18x. By comparison, Salesforce trades at roughly 7 to 9x revenue, Microsoft at roughly 12 to 14x, Adobe at 10 to 12x, and most other large-cap enterprise SaaS names well below ServiceNow's multiple. The premium reflects several factors: ServiceNow's revenue growth rate of 22% in 2024, well above most large SaaS peers; the durable 99% renewal rate and predictable subscription revenue; the 30%+ non-GAAP operating margin that demonstrates structural profitability at scale; the 31% free cash flow margin; and increasing investor enthusiasm for the company's role in generative AI through the Now Assist platform. The valuation has expanded substantially over recent years, with the stock outperforming the S&P 500 Information Technology Index by a wide margin since Bill McDermott assumed the CEO role in November 2019. The premium multiple does create risk of significant multiple compression if growth decelerates, AI monetization disappoints, or macroeconomic conditions tighten enterprise IT spending, and the stock has been volatile around earnings prints despite consistent fundamental delivery.
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CorpDigest. "ServiceNow, Inc. Revenue & Financials." CorpDigest, https://corpdigest.com/company/servicenow/financials.<div style="font-family:system-ui,sans-serif;font-size:14px;line-height:1.5;border:1px solid #e2e8f0;border-radius:8px;padding:12px 16px;max-width:520px"><strong>ServiceNow, Inc. reported $13B in revenue (FY2025).</strong><br>Source: <a href="https://corpdigest.com/company/servicenow/financials" target="_blank" rel="noopener">CorpDigest — ServiceNow, Inc. financials</a></div>