# ServiceNow, Inc. (NOW)

Informational only - not investment advice.

CIK: 0001373715
SIC: 7372 Services-Prepackaged Software
SIC breadcrumb: [Services](/division/I/) > [Business Services](/major-group/73/) > [SIC 7372 Services-Prepackaged Software](/industry/7372/)
Latest 10-K filed: 2026-01-29
SEC page: https://www.sec.gov/edgar/browse/?CIK=1373715
Filing source: https://www.sec.gov/Archives/edgar/data/1373715/000137371526000007/now-20251231.htm

## At a glance

FY2025 · period end 2025-12-31 · filed 2026-01-29 · accession 0001373715-26-000007 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001373715.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 13,278,000,000 USD | 2025 | verified |
| Net income | 1,748,000,000 USD | 2025 | verified |
| Assets | 26,038,000,000 USD | 2025 | verified |
| Free cash flow | 4,576,000,000 USD | 2025 | computed |
| Net margin | 13.16% | 2025 | computed |
| Operating margin | 13.74% | 2025 | computed |
| Revenue YoY | +20.88% | 2025 | computed |
| ROE | 13.48% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

Peer groups: [Large-cap software and SaaS](/compare/software/) · SIC 7372 Services-Prepackaged Software

No market price, no rating, no forecast on this site. Not investment advice.

## Peer comparisons including NOW

- Large-cap software and SaaS: [peer review](/compare/software/) · [market-risk page](/compare/software/risk/)

### Peer percentile fingerprint

| Ratio | NOW | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 13.2% | 1.5% | 75 | 122 |
| Operating margin | 13.7% | 1.3% | 74 | 121 |
| Revenue growth | 20.9% | 13.5% | 76 | 124 |
| FCF margin | 34.5% | 19.3% | 92 | 120 |
| ROE | 13.5% | 2.0% | 72 | 112 |
| ROA | 6.7% | 0.9% | 75 | 124 |
| Liabilities / equity | 1.01 | 0.91 | 56 | 113 |
| Current ratio | 1.00 | 1.57 | 20 | 124 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 7372 Services-Prepackaged Software, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 13278000000 | USD | 2025 | 2026-01-29 |
| Net income | 1748000000 | USD | 2025 | 2026-01-29 |
| Assets | 26038000000 | USD | 2025 | 2026-01-29 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-01-29. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001373715.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2013 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  |  | 1,390,985,000 | 1,918,494,000 | 2,608,816,000 | 3,460,000,000 | 4,519,000,000 | 5,896,000,000 | 7,245,000,000 | 8,971,000,000 | 10,984,000,000 | 13,278,000,000 |
| Net income |  |  | -414,249,000 | -116,846,000 | -26,704,000 | 626,698,000 | 119,000,000 | 230,000,000 | 325,000,000 | 1,731,000,000 | 1,425,000,000 | 1,748,000,000 |
| Operating income |  |  | -382,168,000 | -64,396,000 | -42,426,000 | 42,000,000 | 199,000,000 | 257,000,000 | 355,000,000 | 762,000,000 | 1,364,000,000 | 1,824,000,000 |
| Gross profit |  |  | 991,990,000 | 1,418,632,000 | 1,986,158,000 | 2,664,000,000 | 3,532,000,000 | 4,543,000,000 | 5,672,000,000 | 7,050,000,000 | 8,697,000,000 | 10,295,000,000 |
| Diluted EPS | -0.54 |  |  | -0.68 | -0.15 | 3.18 | 0.59 | 1.13 | 1.60 | 1.68 | 1.37 | 1.67 |
| Operating cash flow |  |  | 159,081,000 | 642,940,000 | 811,089,000 | 1,236,000,000 | 1,786,000,000 | 2,191,000,000 | 2,723,000,000 | 3,398,000,000 | 4,267,000,000 | 5,444,000,000 |
| Capital expenditures |  |  | 105,562,000 | 150,510,000 | 224,462,000 | 265,000,000 | 419,000,000 | 392,000,000 | 550,000,000 | 694,000,000 | 852,000,000 | 868,000,000 |
| Share buybacks |  | 0.00 | 0.00 | 55,000,000 | 0.00 | 0.00 |  | 0.00 | 0.00 | 538,000,000 | 696,000,000 | 1,840,000,000 |
| Assets |  |  | 2,033,767,000 | 3,550,245,000 | 3,879,140,000 | 6,022,430,000 | 8,715,000,000 | 10,798,000,000 | 13,299,000,000 | 17,387,000,000 | 20,383,000,000 | 26,038,000,000 |
| Liabilities |  |  | 1,646,806,000 | 2,771,501,000 | 2,767,941,000 | 3,894,489,000 | 5,881,000,000 | 7,103,000,000 | 8,267,000,000 | 9,759,000,000 | 10,774,000,000 | 13,074,000,000 |
| Stockholders' equity |  |  | 541,093,000 | 778,744,000 | 1,110,000,000 | 2,127,000,000 | 2,834,000,000 | 3,695,000,000 | 5,032,000,000 | 7,628,000,000 | 9,609,000,000 | 12,964,000,000 |
| Cash and cash equivalents |  |  | 401,238,000 | 726,495,000 | 566,204,000 | 776,000,000 | 1,677,000,000 | 1,728,000,000 | 1,470,000,000 | 1,897,000,000 | 2,304,000,000 | 3,726,000,000 |
| Free cash flow |  |  | 53,519,000 | 492,430,000 | 586,627,000 | 971,000,000 | 1,367,000,000 | 1,799,000,000 | 2,173,000,000 | 2,704,000,000 | 3,415,000,000 | 4,576,000,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2013 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  |  | -29.78% | -6.09% | -1.02% | 18.11% | 2.63% | 3.90% | 4.49% | 19.30% | 12.97% | 13.16% |
| Operating margin |  |  | -27.47% | -3.36% | -1.63% | 1.21% | 4.40% | 4.36% | 4.90% | 8.49% | 12.42% | 13.74% |
| Return on equity |  |  | -76.56% | -15.00% | -2.41% | 29.46% | 4.20% | 6.22% | 6.46% | 22.69% | 14.83% | 13.48% |
| Return on assets |  |  | -20.37% | -3.29% | -0.69% | 10.41% | 1.37% | 2.13% | 2.44% | 9.96% | 6.99% | 6.71% |
| Liabilities / equity |  |  | 3.04 | 3.56 | 2.49 | 1.83 | 2.08 | 1.92 | 1.64 | 1.28 | 1.12 | 1.01 |
| Current ratio |  |  | 1.25 | 1.19 | 1.17 | 1.03 | 1.21 | 1.05 | 1.11 | 1.06 | 1.10 | 1.00 |

## As-reported value updates

9 tracked differences above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period.

Ledger: /company/NOW/revisions/


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-07-23. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001373715.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q3 | 2022-09-30 |  |  | 0.39 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | 0.73 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 |  |  | 5.08 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 2,288,000,000 | 242,000,000 | 1.17 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 2,437,000,000 | 295,000,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 2,603,000,000 | 347,000,000 | 1.67 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 2,627,000,000 | 262,000,000 | 1.26 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 2,797,000,000 | 432,000,000 | 2.07 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 2,957,000,000 | 384,000,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 3,088,000,000 | 460,000,000 | 2.20 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 3,215,000,000 | 385,000,000 | 1.84 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 3,407,000,000 | 502,000,000 | 2.40 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 3,568,000,000 | 401,000,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 3,770,000,000 | 469,000,000 | 0.45 | reported discrete quarter |
| 2026-Q2 | 2026-06-30 | 3,987,000,000 | 298,000,000 | 0.29 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from NOW's latest 10-K: [/company/NOW/business/](/company/NOW/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from NOW's latest 10-K: [/company/NOW/risk-factors/](/company/NOW/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1373715/000137371526000076/now-20260630.htm

Extracted from a substantive MD&A body after the formal Item 2 span was a TOC or reference stub.
Confidence: high
Filing date: 2026-07-23
Report date: 2026-06-30

Overview

ServiceNow delivers solutions that help public and private organizations govern, secure and manage artificial intelligence and digitalize and streamline workflows to drive collaboration, productivity and better experiences across the enterprise. At the core of these solutions is the ServiceNow AI Platform (“Platform”), a robust, cloud-based Platform that facilitates comprehensive delivery of seamless workflows and drives digital transformation across all departments and personas within an organization. Our Platform’s single data fabric and integrated data layer supports organizations’ operationalization of their AI strategy with speed, scale and security. Our workflow applications built on the Platform are grouped into four areas: Technology, CRM and Industry, Core Business, and Creator and Other. We offer an innovative suite of products, including AI-powered applications, and services designed to automate workflows, integrate systems and empower employees, regardless of existing systems, cloud environments or collaboration tools. The combination of ServiceNow's Security Operations with Armis' cyber asset intelligence and Veza's identity governance capabilities delivers end-to-end visibility, risk controls, and

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automated responses across the enterprise. Our one platform architecture provides the foundation for organizations to seamlessly integrate AI, data, and workflows and create intelligent processes across their enterprise.

We are closely monitoring ongoing global conflicts. While those events are continuing to evolve and the outcomes remain highly uncertain, we do not believe they will have a material impact on our business and results of operations. However, if the conflicts persist or worsen, leading to greater global economic disruptions and uncertainty, our business and results of operations could be materially impacted.

Additionally, other macroeconomic events, including interest rates, global inflation and tariffs, have led to economic uncertainty in the global economy. To mitigate risk, our cash and cash equivalents are distributed across several large financial institutions and are not concentrated in one financial institution. We have not experienced any impact to our liquidity or to our current and projected business operations and financial condition due to recent macroeconomic events. Further, we have policy restrictions on the types of securities that can be purchased as part of our available-for-sale debt securities portfolio. These restrictions take industry and company concentration limits into consideration among other things. We will continue to monitor the direct and indirect impact of macroeconomic events on our business and financial results.

See the “Risk Factors” section in Part I, Item 1A of our Annual Report on Form 10-K filed with the SEC on January 29, 2026 for further discussion of the possible impact of conflicts and macroeconomic events on our business and financial results.

On December 5, 2025, our board of directors approved and declared a 5-for-1 split of our common stock (“Stock Split”), with a proportionate increase in the number of shares of authorized common stock. The Stock Split had a record date of December 16, 2025 and an effective date of December 17, 2025. The par value per share of our common stock remains unchanged at $0.001 per share after the Stock Split. Accordingly, an amount equal to the par value of the additional issued shares resulting from the Stock Split was reclassified from additional paid-in capital to common stock. All references made to common share, equity award and per share amounts throughout this Management's Discussion and Analysis of Financial Condition and Results of Operations have been retroactively adjusted to reflect the effects of the Stock Split.

Key Business Metrics

Remaining performance obligations. Transaction price allocated to remaining performance obligations (“RPO”) represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancellable amounts that will be invoiced and recognized as revenue in future periods. RPO excludes contracts that are billed in arrears, such as certain time and materials contracts, as we apply the “right to invoice” practical expedient under relevant accounting guidance. Current remaining performance obligations (“cRPO”) represents RPO that will be recognized as revenue in the next 12 months.

As of June 30, 2026, our RPO was $29.0 billion, of which 46% represented cRPO. RPO and cRPO both increased by 21% compared to June 30, 2025. Factors that may cause our RPO to vary from period to period include the following:

•Foreign currency exchange rates. While a majority of our contracts have historically been in U.S. Dollars, an increasing percentage of our contracts in recent periods has been in foreign currencies, particularly the Euro and British Pound Sterling. Fluctuations in foreign currency exchange rates as of the balance sheet date will cause variability in our RPO.

•Mix of offerings. In a minority of cases, we allow our customers to host our software by themselves or through a third-party service provider. In self-hosted offerings, we recognize a portion of the revenue upfront upon the delivery of the software and as a result, such revenue is excluded from RPO.

•Subscription start date. From time to time, we enter into contracts with a subscription start date in the future and these amounts are included in RPO if such contracts are signed by the balance sheet date.

31

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•Timing of contract renewals. While customers typically renew their contracts at the end of the contract term, from time to time, customers may do so either before or after the scheduled expiration date. For example, in cases where we are successful in selling additional products or services to an existing customer, a customer may decide to renew its existing contract early to ensure that all its contracts expire on the same date. In other cases, prolonged negotiations or other factors may result in a contract not being renewed until after it has expired.

•Contract duration. While we typically enter into multi-year subscription services, the duration of our contracts varies. Further, we continue to see an increase in the number of 12-month agreements entered into with the U.S. federal government throughout the year, with the highest number of agreements entered into in the quarter ended September 30, driven primarily by timing of their annual budget expenditures. We sometimes also enter into contracts with durations that have a 12-month or shorter term to enable the contracts to co-terminate with the existing contract. The contract duration will cause variability in our RPO.

Number of customers with ACV greater than $5 million. We count the total number of customers with annual contract value (“ACV”) greater than $5 million as of the end of the period. We had 658 and 533 customers with ACV greater than $5 million as of June 30, 2026 and 2025, respectively. For purposes of customer count, a customer is defined as an entity that has a unique Dunn & Bradstreet Global Ultimate (“GULT”) Data Universal Numbering System (“DUNS”) number and an active subscription contract as of the measurement date. The DUNS number is a global standard for business identification and tracking. We make exceptions for holding companies, government entities and other organizations for which the GULT, in our judgment, does not accurately represent the ServiceNow customer. For example, while all U.S. government agencies roll up to “Government of the United States” under the GULT, we count each government agency that we contract with as a separate customer. Our customer count is subject to adjustments for acquisitions, spin-offs and other market activity; accordingly, we restate previously disclosed number of customers with ACV greater than $5 million calculations to allow for comparability. ACV is calculated based on the foreign exchange rate in effect at the time the contract was signed. Foreign exchange rate fluctuations could cause some variability in the number of customers with ACV greater than $5 million. We believe information regarding the total number of customers with ACV greater than $5 million provides useful information to investors because it is an indicator of our growing customer base and demonstrates the value customers are receiving from the Platform.

Free cash flow. We define free cash flow, a non-GAAP financial measure, as GAAP net cash provided by operating activities plus cash outflows for legal settlements and business combination and other related costs including compensation expense, reduced by purchases of property and equipment. Purchases of property and equipment are otherwise included in cash used in investing activities under GAAP. We believe information regarding free cash flow provides useful information to investors because it is an indicator of the strength and performance of our business operations. However, our calculation of free cash flow may not be comparable to similar measures used by other companies. Our calculation of free cash flow is provided below:

[[GREPCENT_TABLE]]
[["","32"]]
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[[GREPCENT_TABLE]]
[["","Six Months Ended June 30,","","% Change"],["","2026","","2025"],["","(dollars in millions)"],["GAAP net cash provided by operating activities","$","2,257","","","$","2,393","","","(6","%)"],["Purchases of property and equipment","(255)","","","(395)","","","(35","%)"],["Business combination and other related costs","297","","","14","","","NM"],["Non-GAAP free cash flow","$","2,299","","","$","2,012","","","14","%"]]
[[/GREPCENT_TABLE]]

NM - Not meaningful

We have historically seen higher collections in the quarter ended March 31 due to seasonality in timing of entering into customer contracts, which is significantly higher in the quarter ended December 31. Additionally, we have historically seen higher disbursements in the quarters ended March 31 and September 30 due to payouts under our annual commission plans, purchases under our employee stock purchase plan, payouts under our bonus plans and coupon payments related to our 2030 Notes.

Non-GAAP consolidated income from operations. Non-GAAP consolidated income from operations is identified as an additional measure of profit or loss. This non-GAAP measure is used by the chief operating decision maker to allocate resources and assess performance. We define non-GAAP consolidated income from operations as income from operations excluding certain non-cash or non-recurring items, including stock-based compensation expense, amortization of purchased intangibles, legal settlements, impairment of assets, severance costs, contract termination costs and business combination and other related costs including compensation expense. We believe these adjustments provide useful supplemental information to investors and facilitate the analysis of our operating results and comparison of those results across reporting periods. The following table shows the reconciliation of our reported consolidated income from operations to non-GAAP consolidated income from operations.

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1373715/000137371526000007/now-20251231.htm
Complete FY 2025 MD&A: /company/NOW/mda/fy2025/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-01-29
Report date: 2025-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This section of our Annual Report on Form 10-K discusses our financial condition and results of operations for the fiscal years ended December 31, 2025 and 2024, and year-to-year comparisons between fiscal 2025 and fiscal 2024 in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). A discussion of our financial condition and results of operations for the fiscal year ended December 31, 2023 and year-to-year comparisons between fiscal 2024 and fiscal 2023 that is not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on January 30, 2025.

Our free cash flow and non-GAAP consolidated income from operations measures included in the section entitled “Key Business Metrics—Free Cash Flow” and “Key Business Metrics—Non-GAAP Consolidated Income from Operations” are not in accordance with GAAP. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. These measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP results, to more fully understand our business.

Overview

ServiceNow delivers solutions that help public and private organizations govern, secure and manage artificial intelligence and digitalize and streamline workflows to drive collaboration, productivity and better experiences across the enterprise. At the core of these solutions is the ServiceNow AI Platform (“Platform”), a robust, cloud-based Platform that facilitates comprehensive delivery of seamless workflows and drives digital transformation across all departments and personas within an organization. Our Platform’s single data fabric and integrated data layer supports organizations’ operationalization of their AI strategy with speed, scale and security. Our workflow applications built on the Platform are grouped into four areas: Technology, CRM and Industry, Core Business, and Creator and Other. We offer an innovative suite of products, including AI-powered applications, and services designed to automate workflows, integrate systems and empower employees, regardless of existing systems, cloud environments or collaboration tools. Our one platform architecture provides the foundation for organizations to seamlessly integrate AI, data, and workflows and create intelligent processes across their enterprise.

We are closely monitoring ongoing global conflicts. While those events are continuing to evolve and the outcomes remain highly uncertain, we do not believe they will have a material impact on our business and results of operations. However, if the conflicts persist or worsen, leading to greater global economic disruptions and uncertainty, our business and results of operations could be materially impacted.

Additionally, other macroeconomic events, including interest rates, global inflation and tariffs, have led to economic uncertainty in the global economy. To mitigate risk, our cash and cash equivalents are distributed across several large financial institutions and are not concentrated in one financial institution. We have not experienced any impact to our liquidity or to our current and projected business operations and financial condition due to recent macroeconomic events. Further, we have policy restrictions on the types of securities that can be purchased as part of our available-for-sale debt securities portfolio. These restrictions take industry and company concentration limits into consideration among other things. We will continue to monitor the direct and indirect impact of macroeconomic events on our business and financial results.

See the “Risk Factors” section in Part I, Item 1A of this Annual Report for further discussion of the possible impact of conflicts and macroeconomic events on our business and financial results.

48

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Part II

On December 5, 2025, our board of directors approved and declared a 5-for-1 split of our common stock (“Stock Split”), with a proportionate increase in the number of shares of authorized common stock. The Stock Split had a record date of December 16, 2025 and an effective date of December 17, 2025. The par value per share of our common stock remains unchanged at $0.001 per share after the Stock Split. Accordingly, an amount equal to the par value of the additional issued shares resulting from the Stock Split was reclassified from additional paid-in capital to common stock. All references made to common share, equity award and per share amounts throughout this Management's Discussion and Analysis of Financial Condition and Results of Operations have been retroactively adjusted to reflect the effects of the Stock Split.

Key Business Metrics

Remaining performance obligations. Transaction price allocated to remaining performance obligations (“RPO”) represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancellable amounts that will be invoiced and recognized as revenue in future periods. RPO excludes contracts that are billed in arrears, such as certain time and materials contracts, as we apply the “right to invoice” practical expedient under relevant accounting guidance. Current remaining performance obligations (“cRPO”) represents RPO that will be recognized as revenue in the next 12 months.

As of December 31, 2025, our RPO was $28.2 billion, of which 46% represented cRPO. RPO and cRPO increased by 27% and 25%, respectively, compared to December 31, 2024. Factors that may cause our RPO to vary from period to period include the following:

•Foreign currency exchange rates. While a majority of our contracts have historically been in U.S. Dollars, an increasing percentage of our contracts in recent periods has been in foreign currencies, particularly the Euro and British Pound Sterling. Fluctuations in foreign currency exchange rates as of the balance sheet date will cause variability in our RPO.

•Mix of offerings. In a minority of cases, we allow our customers to host our software by themselves or through a third-party service provider. In self-hosted offerings, we recognize a portion of the revenue upfront upon the delivery of the software and as a result, such revenue is excluded from RPO.

•Subscription start date. From time to time, we enter into contracts with a subscription start date in the future and these amounts are included in RPO if such contracts are signed by the balance sheet date.

•Timing of contract renewals. While customers typically renew their contracts at the end of the contract term, from time to time, customers may do so either before or after the scheduled expiration date. For example, in cases where we are successful in selling additional products or services to an existing customer, a customer may decide to renew its existing contract early to ensure that all its contracts expire on the same date. In other cases, prolonged negotiations or other factors may result in a contract not being renewed until after it has expired.

•Contract duration. While we typically enter into multi-year subscription services, the duration of our contracts varies. Further, we continue to see an increase in the number of 12-month agreements entered into with the U.S. federal government throughout the year, with the highest number of agreements entered into in the quarter ended September 30, driven primarily by timing of their annual budget expenditures. We sometimes also enter into contracts with durations that have a 12-month or shorter term to enable the contracts to co-terminate with the existing contract. The contract duration will cause variability in our RPO.

Number of customers with ACV greater than $5 million. We count the total number of customers with annual contract value (“ACV”) greater than $5 million as of the end of the period. We had 603, 502, and 420 customers with ACV greater than $5 million as of December 31, 2025, 2024 and 2023, respectively. For purposes of customer count, a customer is defined as an entity that has a unique Dunn & Bradstreet Global Ultimate (“GULT”) Data Universal Numbering System (“DUNS”) number and an active subscription contract as of the measurement date. The DUNS number is a global standard for business identification and tracking. We make exceptions for holding companies, government entities and other organizations for which the GULT, in our judgment, does not accurately represent the ServiceNow customer. For example, while all U.S. government agencies roll up to “Government of the United States” under the GULT, we count each government agency that we contract with as a

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Table of Contents

Part II

separate customer. Our customer count is subject to adjustments for acquisitions, spin-offs and other market activity; accordingly, we restate previously disclosed number of customers with ACV greater than $5 million calculations to allow for comparability. ACV is calculated based on the foreign exchange rate in effect at the time the contract was signed. Foreign exchange rate fluctuations could cause some variability in the number of customers with ACV greater than $5 million. We believe information regarding the total number of customers with ACV greater than $5 million provides useful information to investors because it is an indicator of our growing customer base and demonstrates the value customers are receiving from the Platform.

Free cash flow. We define free cash flow, a non-GAAP financial measure, as GAAP net cash provided by operating activities plus cash outflows for legal settlements and business combination and other related costs including compensation expense, reduced by purchases of property and equipment. Purchases of property and equipment are otherwise included in cash used in investing activities under GAAP. We believe information regarding free cash flow provides useful information to investors because it is an indicator of the strength and performance of our business operations. However, our calculation of free cash flow may not be comparable to similar measures used by other companies. A calculation of free cash flow is provided below:

[[GREPCENT_TABLE]]
[["","Year Ended December 31,"],["","2025","","2024","","2023"],["","(dollars in millions)"],["GAAP net cash provided by operating activities","$","5,444","","","$","4,267","","","$","3,398"],["Purchases of property and equipment","(868)","","","(852)","","","(694)"],["Business combination and other related costs","60","","","23","","","24"],["Legal settlements","\u2014","","","17","","","\u2014"],["Non-GAAP free cash flow","$","4,636","","","$","3,455","","","$","2,728"]]
[[/GREPCENT_TABLE]]

We have historically seen higher collections in the quarter ended March 31 due to seasonality in timing of entering into customer contracts, which is significantly higher in the quarter ended December 31. Additionally, we have historically seen higher disbursements in the quarters ended March 31 and September 30 due to payouts under our annual commission plans, purchases under our employee stock purchase plan, payouts under our bonus plans and coupon payments related to our 2030 Notes.

Non-GAAP consolidated income from operations. Non-GAAP consolidated income from operations is identified as an additional measure of profit or loss. This non-GAAP measure is used by the chief operating decision maker to allocate resources and assess performance. We define non-GAAP consolidated income from operations as

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2025 MD&A: /company/NOW/mda/fy2025/
All MD&A years: /company/NOW/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/NOW/mda/fy2024/): filed 2025-01-30; accession 0001373715-25-000010 (https://www.sec.gov/Archives/edgar/data/1373715/000137371525000010/now-20241231.htm)
- [FY 2023 MD&A](/company/NOW/mda/fy2023/): filed 2024-01-25; accession 0001373715-24-000030 (https://www.sec.gov/Archives/edgar/data/1373715/000137371524000030/now-20231231.htm)
- [FY 2022 MD&A](/company/NOW/mda/fy2022/): filed 2023-01-31; accession 0001373715-23-000035 (https://www.sec.gov/Archives/edgar/data/1373715/000137371523000035/now-20221231.htm)
- [FY 2021 MD&A](/company/NOW/mda/fy2021/): filed 2022-02-03; accession 0001373715-22-000024 (https://www.sec.gov/Archives/edgar/data/1373715/000137371522000024/now-20211231.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 7372 Services-Prepackaged Software) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity

Macro-to-micro threads including this sector: [US labor market](/thread/us-labor-market/), [Growth & output](/thread/growth-output/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/NOW.md · JSON record: /company/NOW.json · verified financials: /company/NOW/financials.json / /company/NOW/financials.csv · machine TOC for the whole site: /llms.txt