ServiceNow (NYSE:NOW) Shares Gap Up on Earnings Beat

ServiceNow, Inc. (NYSE:NOW) shares gapped up prior to trading on Thursday following a stronger than expected earnings report. The stock had previously closed at $95.46, but opened at $100.01. ServiceNow shares last traded at $97.0110, with a volume of 13,222,877 shares.

The information technology services provider reported $0.90 earnings per share for the quarter, beating analysts’ consensus estimates of $0.86 by $0.04. The company had revenue of $3.99 billion for the quarter, compared to analyst estimates of $3.93 billion. ServiceNow had a return on equity of 18.16% and a net margin of 12.59%.The company’s revenue for the quarter was up 24.0% on a year-over-year basis. During the same quarter last year, the company earned $0.81 earnings per share.

Trending Headlines about ServiceNow

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: ServiceNow beat Q2 profit and revenue estimates, showing demand for its workflow automation software remains strong. ServiceNow Reports Second Quarter 2026 Financial Results
• Positive Sentiment: The company raised its subscription revenue forecast again, suggesting AI-powered products are driving faster growth than expected. ServiceNow raises annual subscription revenue forecast again on AI-driven demand
• Positive Sentiment: AI contract value crossed the $1 billion mark and backlog/remaining performance obligations remained strong, reinforcing the long-term revenue outlook. ServiceNow AI Contract Value Crosses $1 Billion Milestone, Stock Soars
• Positive Sentiment: Several analysts reaffirmed bullish ratings and lifted price targets after the results, which can help sustain momentum. Analyst rating updates

Wall Street Analyst Weigh In

NOW has been the topic of a number of analyst reports. Weiss Ratings downgraded shares of ServiceNow from a “hold (c-)” rating to a “sell (d+)” rating in a report on Friday, July 10th. The Goldman Sachs Group reiterated a “buy” rating and issued a $145.00 target price (down from $163.00) on shares of ServiceNow in a report on Wednesday, July 8th. Robert W. Baird dropped their price target on shares of ServiceNow from $125.00 to $118.00 and set an “outperform” rating on the stock in a research report on Thursday, April 23rd. UBS Group set a $248.00 price target on shares of ServiceNow in a report on Thursday. Finally, DA Davidson set a $170.00 price objective on shares of ServiceNow and gave the stock a “buy” rating in a research report on Monday. One investment analyst has rated the stock with a Strong Buy rating, thirty-six have assigned a Buy rating, two have given a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $142.56.

Insiders Place Their Bets

In related news, insider Jacqueline P. Canney sold 8,927 shares of the business’s stock in a transaction dated Friday, April 24th. The shares were sold at an average price of $89.60, for a total value of $799,859.20. Following the transaction, the insider directly owned 29,531 shares of the company’s stock, valued at approximately $2,645,977.60. The trade was a 23.21% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, insider Paul Fipps sold 1,048 shares of the stock in a transaction dated Monday, May 18th. The shares were sold at an average price of $98.51, for a total transaction of $103,238.48. Following the transaction, the insider owned 12,072 shares of the company’s stock, valued at approximately $1,189,212.72. The trade was a 7.99% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders sold 28,071 shares of company stock valued at $2,529,956. 0.34% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in NOW. Millstone Evans Group LLC lifted its stake in ServiceNow by 400.0% in the fourth quarter. Millstone Evans Group LLC now owns 165 shares of the information technology services provider’s stock valued at $25,000 after purchasing an additional 132 shares during the last quarter. CBIZ Investment Advisory Services LLC increased its position in ServiceNow by 540.0% in the fourth quarter. CBIZ Investment Advisory Services LLC now owns 160 shares of the information technology services provider’s stock worth $25,000 after buying an additional 135 shares during the last quarter. Blueline Advisors LLC bought a new stake in shares of ServiceNow in the fourth quarter valued at $25,000. Measured Wealth Private Client Group LLC raised its stake in shares of ServiceNow by 560.0% in the fourth quarter. Measured Wealth Private Client Group LLC now owns 165 shares of the information technology services provider’s stock valued at $25,000 after buying an additional 140 shares during the period. Finally, Wealth Watch Advisors INC lifted its position in shares of ServiceNow by 432.3% during the 4th quarter. Wealth Watch Advisors INC now owns 165 shares of the information technology services provider’s stock valued at $25,000 after buying an additional 134 shares during the last quarter. 87.18% of the stock is currently owned by hedge funds and other institutional investors.

ServiceNow Price Performance

The company has a debt-to-equity ratio of 0.13, a quick ratio of 0.84 and a current ratio of 0.84. The company has a market cap of $100.68 billion, a P/E ratio of 58.20, a P/E/G ratio of 1.71 and a beta of 0.96. The firm has a 50 day moving average price of $104.67 and a two-hundred day moving average price of $108.16.

ServiceNow Company Profile

ServiceNow (NYSE: NOW) is a cloud computing company that builds enterprise software to manage digital workflows and automate business processes. Its offerings are designed to replace manual work and legacy systems with cloud-based, service-oriented applications that support IT operations, customer service, human resources, security response and other enterprise functions.

The company’s flagship product family is the Now Platform, a suite of subscription software and platform services that includes IT Service Management (ITSM), IT Operations Management (ITOM), IT Business Management (ITBM), Customer Service Management (CSM), HR Service Delivery, Security Operations and Asset Management.