ServiceNow, Inc. Q3 2025 Earnings Recap

ServiceNow's Q3 2025 results significantly exceeded expectations, with a remarkable 20.5% year-over-year subscription revenue growth and a strengthened operating margin, underscoring its leadership in enterprise AI solutions.

Key Takeaways

• Subscription revenue and current RPO growth both surged 20.5% year-over-year, outperforming guidance by 1 and 2.5 points, respectively.
• Operating margin improved to 33.5%, exceeding guidance by 3 points, while free cash flow margin stood at 17.5%.
• The company secured 103 deals exceeding $1 million in net new ACV, highlighting robust demand across its product offerings, particularly in technology workflows and AI solutions.
• ServiceNow's AI initiatives, including Now Assist, are projected to generate over $0.5 billion in ACV this year, on track to exceed the $1 billion target next year, reflecting strong momentum in enterprise AI transformation.
• Continued innovation and strategic partnerships position ServiceNow as a pivotal player in the rapidly evolving AI ecosystem, solidifying its status among the "Super 8" of enterprise software.