On July 23, ServiceNow rose 4.65% overnight, trading at $99.95/share, reversing the prior session's decline of over 5% that was driven by sector-wide pressure ahead of earnings.

The rally was triggered by ServiceNow's Q2 earnings release, which exceeded market expectations across all key metrics. The company reported revenue of $3.987 billion, surpassing the consensus estimate of $3.928 billion, representing approximately 24% year-over-year growth. Adjusted EPS came in at $0.90, beating the $0.85 analyst estimate by nearly 6%, reflecting a roughly 10% increase from the prior year period. Subscription revenue reached $3.88 billion, also above forecasts.

Driven by sustained AI-powered software demand growth, ServiceNow raised its full-year subscription revenue guidance to $15.76 billion to $15.78 billion. The company noted its AI platform is now deployed across nearly 50 U.S. states for citizen services and operational modernization. Additionally, the CEO announced plans to deepen strategic partnerships with Palo Alto Networks and CrowdStrike. The strong results effectively reversed negative sentiment that had weighed on the stock since IBM's disappointing preliminary results pressured the broader software sector starting July 14.

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