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ServiceNow reported its Q2 results Wednesday night, which were positive on several fronts.
The firm “significantly beat the high end” of its guidance for topline and profitability metrics. Subscription revenue was up 21.5% (constant currency) over the comparable quarter last year (to $3.11bn), while operating margin was 29.5% (c.2.5 points above guidance).
The firm ended the quarter with 528 customers with more than $5m in annual contract value (ACV), which is c.19.5% growth over last year. Meanwhile, the number of customers with more than $20m in ACV grew by more than 30% year-on-year. This means ServiceNow is “firmly on track” to hit its 2026 target of $1bn in ACV.
ServiceNow Chairman and CEO Bill McDermott said “ServiceNow has never been more differentiated as a full stack agentic operating system for the enterprise”.
ServiceNow acquired data.world, a cloud-native enterprise data catalogue and governance platform provider, in May. Its tech will be incorporated into the ServiceNow AI Platform to enhance AI agent understanding and deepen enterprise data intelligence and governance.
The company also announced agentic workforce management, which extends its end-to-end AI agent orchestration capability. It’s another step forward in enabling human employees and AI agents to work in unison. Members of our TechSectorViews programme can tap into our research identifying the best opportunities for IT Service providers around the Future of Work later this year.
President and CFO, Gina Mastantuono, said that with “robust pipeline and expanding market opportunities…we are well‑positioned for the second half of the year”. The expectation is for 19.5-20% growth (constant currency basis) in subscription revenue, with an expected operating margin of 30.5%.
Posted by: Kate Hanaghan at 10:31
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results
AgenticAI