ServiceNow (NOW) Q3 2024 Earnings Transcript

Motley Fool Transcribing, The Motley Fool

Wed, April 22, 2026 astatine 9:54 AM CDT 49 min read

Image source: The Motley Fool.

Wednesday, Oct. 23, 2024 astatine 5 p.m. ET

• President & Chief Executive Officer — William McDermott

• Chief Financial Officer — Gina Mastantuono

Need a punctuation from a Motley Fool analyst? Email [email protected]

William McDermott: Thank you precise much, Darren. Good day everyone. I truly admit you joining today. There's a batch to screen successful this latest bushed and rise report. I'll absorption connected 5 almighty tailwinds that underscore our beardown assurance successful ServiceNow's maturation trajectory. The archetypal is elite level execution. With our Q3 results, we person demonstrated erstwhile again ServiceNow's beardown execution. We outperformed each apical enactment and profitability metrics. Subscription gross maturation was 22.5% astatine changeless currency, 200 ground points supra the precocious extremity of our guidance. cRPO was 23.5% astatine changeless currency, 150 ground points supra our guidance. Operating borderline was implicit 31%, much than 150 ground points supra our guidance.

We had 96 deals greater than $1 cardinal successful nett caller ACV. We landed our 2nd largest caller logo woody ever and our 2nd lawsuit crossed the $100 cardinal people successful full ACV. Customer adoption of ServiceNow's level continues to determination crossed the endeavor extremity to end. For CIOs and their tech teams, ITSM and ITOM were each successful astatine slightest 15 of our apical 20 deals with double-digit deals implicit $1 million. It's besides worthy noting that IT plus absorption was successful each of our apical 20 deals. Q3 was different beardown show for Security and Risk arsenic they combined for 14 of the apical 20 deals with 11 deals that were implicit $1 million.

As we spot much accidental to disrupt the beforehand office, lawsuit workflows had a large Q3 with 15 of the apical 20 deals and 17 deals implicit $1 million. Employee workflows were successful 13 of the apical 20 with 9 deals implicit $1 cardinal and originative workflow was beardown again successful 17 of the apical 20 with 13 deals implicit $1 million. Here's the headline. Many companies person struggled to execute successful what has been a analyzable macro environment. ServiceNow has delivered consistently beyond the Rule of 50. We are the benchmark for elite level execution. The 2nd tailwind down ServiceNow's occurrence is our increasing strategical relevance.

For years, we've been talking astir the messiness of the 20th period endeavor systems. Organizations astir the satellite needed a level to assistance them cleanable up that mess, truthful they tin modernize for the AI world, ServiceNow is that chosen strategical platforms. And we integrate with each those different systems, orchestrate the silos into modern workflows and make a accordant consumer-grade idiosyncratic experience. It's important to recognize the past here. When nationalist unreality solutions came online arsenic the past secular displacement successful the enterprise, they created sprawling governance challenges. CIOs astatine the absorption of their CEOs were asked to get things nether control, the cost, information and integration. And ServiceNow played that role.