ServiceNow (NOW) Q4 2025 earnings summary

Executive summary

• Q4 and full-year 2025 results exceeded expectations, with accelerated net new ACV growth, strong AI-driven product adoption, and customer expansion.

• Subscription revenue grew 21% year-over-year, surpassing guidance, and operating margin reached 31%, also above guidance.

• Maintained high renewal rates and expanded large customer relationships, with over 600 customers exceeding $5M in annual contract value.

• Strategic acquisitions (Moveworks, Veza, Armis) and expanded partnerships enhanced AI, security, and workflow capabilities.

• Announced an incremental $5 billion share repurchase authorization, with an immediate $2 billion ASR and a 5-for-1 stock split effective December 17, 2025.

Financial highlights

• Q4 2025 subscription revenues were $3,466M, up 21% year-over-year; full-year subscription revenues totaled $12,883M, up 21%.

• RPO at year-end was $28.2B, up 26.5% year-over-year; current RPO was $12.85B, up 25%.

• Free cash flow margin for full-year 2025 was 35% ($4.636B); Q4 free cash flow margin was 57%.

• Non-GAAP operating margin for 2025 was 31%; non-GAAP net income was $3.669B with diluted EPS of $3.51.

• 244 deals over $1M in NNACV closed in Q4, with 7 deals over $10M; 603 customers with >$5M ACV, up ~20%.

Outlook and guidance

• FY 2026 subscription revenue guidance: $15.53B–$15.57B, up 20.5–21% year-over-year (constant currency growth 19.5–20%).

• Q1 2026 subscription revenue guidance: $3.65B–$3.655B, up 21.5% year-over-year (constant currency 18.5–19%).

• FY 2026 non-GAAP operating margin expected at 32%, free cash flow margin at 36%, and subscription gross margin at 82%.

• Guidance includes a 100bps contribution from Moveworks and a 150bps Q1 headwind from mix shift to hosted revenue.

• CRPO growth for Q1 expected at 20% year-over-year.