10-QPeriod: Q3 FY2025

ServiceNow, Inc. Quarterly Report for Q3 Ended Sep 30, 2025

Filed October 30, 2025For Securities:NOW

Summary

ServiceNow, Inc. (NOW) reported solid financial results for the third quarter and first nine months of fiscal year 2025, demonstrating continued revenue growth and operational efficiency. Total revenues increased by 22% year-over-year for the third quarter and 21% for the first nine months, primarily driven by strong performance in subscription revenues. The company also showed significant improvements in profitability, with income from operations growing by 37% and 39% for the respective periods, and an increase in net income. Free cash flow saw a robust 27% increase year-over-year for the nine-month period, highlighting strong cash generation capabilities. The company also made strategic acquisitions and continued its share repurchase program, indicating confidence in its growth prospects and commitment to shareholder returns.

Financial Highlights

52 data points
Beta

Revenue

$3.41B

77.3% Gross Margin

Net Income

$502.00M

14.7% Net Margin

EPS (Diluted)

$0.48

Total Assets

$21.79B

Cash & Equivalents

$2.73B

Free Cash Flow

$578.00M

Financial Statements
Beta
Revenue$3.41B
Cost of Revenue$774.00M
Gross Profit$2.63B
R&D Expenses$750.00M
Operating Expenses$2.06B
Operating Income$572.00M
Net Income$502.00M
EPS (Basic)$0.48
EPS (Diluted)$0.48
Shares Outstanding (Basic)1.04B
Shares Outstanding (Diluted)1.05B

Key Highlights

  • 1Total revenues grew by 22% year-over-year to $3.41 billion in Q3 2025 and 21% year-over-year to $9.71 billion for the first nine months of 2025.
  • 2Subscription revenues, the primary revenue driver, increased by 22% in Q3 and 21% in the first nine months, showcasing consistent demand for ServiceNow's core offerings.
  • 3Income from operations saw a substantial increase of 37% in Q3 and 39% for the first nine months, indicating improved operational leverage and cost management.
  • 4Net income rose to $502 million for Q3 and $1.35 billion for the first nine months, demonstrating enhanced profitability.
  • 5Free cash flow increased by 27% to $2.60 billion for the first nine months of 2025, reflecting strong cash generation from operations.
  • 6The company acquired Logik.io Inc. for $506 million to enhance its CPQ solutions and is pursuing the acquisition of Moveworks, Inc. for approximately $2.9 billion.
  • 7ServiceNow repurchased $1.24 billion of its common stock in the first nine months of 2025, demonstrating a commitment to returning capital to shareholders.

Frequently Asked Questions

ServiceNow reported total revenues of $3.41 billion for the third quarter ended September 30, 2025, representing a 22% increase compared to the same period in 2024. Subscription revenues, which form the majority of the company's revenue, also grew by 22%.

The company demonstrated strong profitability improvements. Income from operations increased by 37% year-over-year to $572 million in the third quarter of 2025. Net income also rose to $502 million for the quarter.

ServiceNow expects subscription revenues to continue growing in absolute dollars and remain relatively flat as a percentage of total revenue for the full year 2025. While sales and marketing expenses are expected to increase in absolute dollars, they are projected to decrease as a percentage of revenue due to increased sales productivity and marketing efficiencies. Research and development expenses are expected to increase in absolute dollars but remain relatively flat as a percentage of revenue, while general and administrative expenses are also expected to increase in absolute dollars but remain relatively flat as a percentage of revenue.

ServiceNow completed the acquisition of Logik.io Inc. for $506 million to enhance its CPQ capabilities and accelerate sales and order management. Additionally, the company has a pending acquisition of Moveworks, Inc. for approximately $2.9 billion, aimed at strengthening its AI platform. The company also made a strategic investment of $750 million in Genesys.