ServiceNow beats expectations on all fronts

ServiceNow has announced financial results for its fourth quarter that beat all predictions. The highlight from the earnings call is the growing number of customers that are spending more than $1m – up by over 50 percent.

Subscription revenues were $1.5bn in the quarter representing 29 percent year-on-year growth. During ServiceNow closed 135 transactions with more than $1m in net new annual contract value and they now have 1,359 customers with more than $1m in annual contract value.

“We once again reported results that significantly beat the high end of expectations,” said ServiceNow President and CEO Bill McDermott. “Customer demand for ServiceNow’s innovative platform is stronger than ever. Our unique culture has made us one of the best places to work. We are growing like a fast-moving start-up with the profitability of a global market leader.”

“Q4 was an outstanding quarter closing out an already phenomenal year of outperformance,” said ServiceNow CFO Gina Mastantuono. “The company is firing on all cylinders and we enter 2022 with tremendous momentum. We expect constant currency subscription revenue growth to accelerate year-over-year in Q1, setting us up for another strong year and putting us well on our way to becoming a $15bn plus revenue company.”

During the quarter, ServiceNow continued to invest in the Now Platform with the acquisitions of ERP migration company Gekkobrain and software testing automation company DotWalk. ServiceNow deepened its strategic partnership with EY to further revolutionise finance and tax services on the Now Platform in support of EY’s goal of creating a $1bn business with ServiceNow by 2025. It also expanded its alliance with KPMG to help customers accelerate ESG impact and modernise risk and resilience. In addition, ServiceNow was recently named the preferred workflow partner for DXC Platform X and further strengthened its partnership with the formation of a DXC ServiceNow Strategic Business Group.

McDermott closed the earnings calls by telling analysts and journalists that, “our customers now view us as the standard platform for digital transformation”. To learn more about ServiceNow and to hear from Bill McDermott in a long-read world exclusive cover story, subscribe for free at https://erp.today/subscribe.

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