NOW Q1 2025 Earnings

Call Details

• Call Title: ServiceNow, Inc. Q1 2025 Earnings Call
• Date: April 23, 2025 at 9:00 PM UTC
• Management Team:
  • Darren Yip (Senior Vice President of Investor Relations and Market Insight)
  • Bill McDermott (Chairman and Chief Executive Officer)
  • Gina Mastantuono (President and Chief Financial Officer)
  • Amit Zavery (President, Chief Product Officer, and Chief Operating Officer)

Call Summary

Financial Performance

• Subscription revenues were $3.005 billion, growing 20% year-over-year in constant currency.
• Remaining performance obligation was approximately $22.1 billion, growing 25.5% year-over-year in constant currency.
• Current RPO was $10.31 billion, representing 22% year-over-year growth in constant currency.
• Non-GAAP operating margin was 31%, approximately 100 basis points above guidance for the quarter.
• Free cash flow margin was 48%, approximately 100 basis points higher year-over-year.
• The company closed 72 deals greater than $1 million in net new ACV, including nine deals greater than $5 million.

Guidance

• Full-year 2025 subscription revenue guidance midpoint was raised by $5 million to a range of $12.64 billion to $12.68 billion, representing 18.5% to 19% year-over-year growth or 19.5% on a constant currency basis.
• Subscription revenue guidance for Q2 2025 is $3.030 billion to $3.035 billion, representing 19% to 19.5% year-over-year growth or 19.5% on a constant currency basis.
• Q2 CRPO growth is expected to be 19.5% on both a reported and constant currency basis.
• Full-year 2025 expectations include subscription gross margin of 83.5%, operating margin of 30.5%, free cash flow margin of 32%, and GAAP diluted weighted average shares of 209 million.
• Q2 operating margin expectation is 27% for the quarter.
• The company stated it only flowed through part of the Q1 beat and FX tailwind into the full-year outlook to incorporate conservatism related to geopolitical and federal budget uncertainty.