01—Abstract
Summary
Summary of the 10-K filed January 30, 2025. Cited figures are marked; the original filing is the authoritative source.
ServiceNow, Inc. (NOW) reported strong performance for the fiscal year ended December 30, 2024, with total revenues reaching $10.98 billiona, a 22% increase year-over-year.
This growth was primarily driven by its subscription services, which saw a 23% increase to $10.65 billionb, demonstrating continued demand for its workflow automation and digital transformation solutions. The company continues to heavily invest in Artificial Intelligence (AI), integrating AI capabilities like Now Assist across its product portfolio to enhance user productivity and accelerate customer ROI. This strategic focus on AI is a key differentiator and a significant driver of future growth, positioning ServiceNow as an AI platform for business transformation.
The company also highlighted its broad customer adoption, with over 85% of the Fortune 500 relying on its platform. Financially, ServiceNow generated substantial operating cash flow of $4.27 billionc and free cash flow of $3.46 billion, underscoring its robust operational efficiency and financial health. The company also continues to return value to shareholders through its share repurchase program, with an additional $3 billion authorized in January 2025.
02—Key points
Key Highlights
- Total revenues increased by 22% to $10.98 billion for the fiscal year ended December 30, 2024.
- Subscription revenues grew by 23% to $10.65 billion, driven by new and existing customer adoption.
- ServiceNow's platform is utilized by over 85% of the Fortune 500 and nearly 60% of the Global 2000.
- Significant investment and integration of AI capabilities, particularly through Now Assist, to enhance workflow automation and customer value.
- Generated $4.27 billion in net cash from operating activities and $3.46 billion in free cash flow.
- Maintained a high renewal rate of 98% for the third consecutive year.
- Announced an additional $3 billion share repurchase program authorization in January 2025, demonstrating commitment to shareholder returns.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, ServiceNow kept $0.13.
- Revenue$10.98B100.0%
- Cost of revenue−$2.29B20.8%
- Gross profit$8.70B79.2%
- Operating costs−$7.33B66.8%
- Operating income$1.36B12.4%
- Interest, other & tax$61.0M0.6%
- Net income$1.43B13.0%
Where FY2024 revenue went
$10.98B- Other operating costs: $4.79B, 44% of revenue
- R&D: $2.54B, 23% of revenue
- Cost of revenue: $2.29B, 21% of revenue
- Operating income: $1.36B, 12% of revenue
Kept 12% as operating income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed January 30, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $10.98B$8.97B | +22.4% |
| Cost of Revenue | $2.29B$1.92B | +19.1% |
| Gross Profit | $8.70B$7.05B | +23.4% |
| R&D Expenses | $2.54B$2.12B | +19.7% |
| Operating Expenses | $7.33B$6.29B | +16.6% |
| Operating Income | $1.36B$762.00M | +79.0% |
| Net Income | $1.43B$1.73B | −17.7% |
| EPS (Basic) | $1.38$1.70 | −18.8% |
| EPS (Diluted) | $1.37$1.68 | −18.5% |
| Shares Outstanding (Basic) | 1.03B1.02B | +0.8% |
| Shares Outstanding (Diluted) | 1.04B1.03B | +1.4% |
05—Questions
Frequently Asked Questions
What are ServiceNow's primary revenue drivers?
ServiceNow's primary revenue driver is its subscription services, which accounted for 97% of total revenues in the fiscal year ended December 30, 2024. These subscription revenues are generated from access to the Now Platform and its associated workflow applications.
How is ServiceNow leveraging Artificial Intelligence (AI) in its offerings?
ServiceNow is heavily integrating AI, including Generative AI and agentic AI, across its platform and applications through its Now Assist solution. This aims to enhance user productivity, automate processes, provide faster insights, and accelerate customer return on investment by embedding AI capabilities directly into workflows.
What is ServiceNow's financial health and cash flow generation like?
The company demonstrates strong financial health, generating $4.27 billion in net cash from operating activities and $3.46 billion in free cash flow for the fiscal year ended December 30, 2024. This robust cash flow generation supports its ongoing investments and shareholder return initiatives.
What are the key risks facing ServiceNow according to the filing?
Key risks identified include the challenge of continuous innovation in a rapidly evolving technological landscape, intense competition, potential cybersecurity threats, reliance on partners, and operational, legal, and ethical challenges associated with integrating AI technologies. Data privacy regulations and international market expansion also pose significant risks.
06—Continue