Bill McDermott, CEO of ServiceNow Inc., at the Allen & Co. Media and Technology Conference in Sun Valley, Idaho, July 10, 2025.
David Paul Morris | Bloomberg | Getty Images
ServiceNow reported first-quarter results Wednesday that narrowly beat Wall Street expectations, but the company said the Middle East conflict was hurting subscription revenue.
Here’s how the company performed compared to LSEG estimates:
Earnings per share: 97 cents adjusted, 96 cents expected; Revenue: $3.77 billion, $3.74 billion expected.
Revenue for the quarter was up 22% year-over-year. The company’s net income was $469 million, or 45 cents per share, up slightly from $460 million, or 44 cents per share, a year ago.
In a release, the company said subscription revenue growth for the quarter was “approximately 75 basis points of headwind due to ongoing conflicts in the region that delayed the completion of several large on-premises transactions in the region.”
The company reported quarterly subscription revenue of $3.67 billion, slightly above the $3.65 billion that FactSet had expected.
ServiceNow raised its forecast for fiscal 2026 subscription revenue of $15.74 billion to $15.78 billion from the previous quarter’s forecast of $15.53 billion to $15.57 billion.
“Our full-year outlook reflects a careful assessment of the current geopolitical environment,” CFO Gina Mastantuono told CNBC. “I’ve certainly been leaning a little bit more towards conservatism because of the ongoing conflict in the Middle East and that could affect the timing of the deal.”
ServiceNow bought back about 20 million shares in the first quarter, more than double the amount it bought in all of 2025. In its last earnings call, the company announced board approval for an additional $5 billion in stock repurchases.
The Santa Clara, California-based company reported current remaining performance obligations of $12.64 billion for the quarter, beating expectations of $12.56 billion. The company reported 16 deals with new annual contract value of more than $5 million in the first quarter, an increase of nearly 80% year-over-year.
ServiceNow is increasing spending in an effort to position itself as an “AI command center.” Stocks have had a rough start to 2026, falling about 30% since the start of the year.
Mastatuono told CNBC that the company’s AI product portfolio continues to perform well and is on track to exceed the company’s $1 billion goal in 2026.
The company also announced that it will expand its contract with. google cloud.
Earlier this week, ServiceNow completed its $7.75 billion acquisition of cybersecurity startup Armis, which was expected to close in the second half of this year.
