Movement Alert|ServiceNow Overnight Decline 17.84%, mixed quarterly results and margin pressure weighed on shares

Market Focus
6 hours ago

On October 29, ServiceNow fell 17.84% Overnight, trading at $123.25 per share, with turnover of $128,300.

The move followed quarterly results that beat revenue expectations but missed on adjusted earnings, while profitability metrics softened and the market reacted negatively despite continued large-deal momentum and a higher full-year free cash flow margin target.

For the third quarter, ServiceNow reported adjusted EPS of $1.00 versus a $1.02 expectation, and revenue of $4.106 billion versus a $4.095 billion expectation. GAAP net income dropped nearly 45% year over year to $277 million. Non-GAAP operating profit rose about 17% to $1.338 billion, but the non-GAAP operating margin declined to 32.5% from 33.5% a year earlier. The company also guided fourth-quarter subscription revenue to $4.25 billion-$4.26 billion, roughly in line with expectations, completed 19 new deals with annual contract value above $5 million, and raised its full-year non-GAAP free cash flow margin target by 100 basis points to 36%.

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