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Jun 30
ServiceNow Q2 2025 Earnings Report
ServiceNow delivered strong Q2 2025 results with robust subscription revenue growth and solid profitability.
Key Takeaways
ServiceNow exceeded guidance in Q2 2025 with strong subscription revenue growth, record RPO, and expanding AI-driven adoption.
Subscription revenues reached $3.113 billion, driven by strong demand for AI-powered solutions.
Net income rose to $385 million, reflecting improved operational efficiency.
Current remaining performance obligations hit $10.92 billion, up significantly year-over-year.
The number of customers with ACV above $20 million grew over 30% year-over-year.
ServiceNow
ServiceNow
ServiceNow Revenue by Segment
Revenue by Segment
Subscription Revenue
CapyFin.comProfessional services Revenue
CapyFin.com Forward Guidance
ServiceNow expects continued growth with strong subscription revenue momentum, despite some Q3 headwinds from large contract renewals.
Positive Outlook
- Subscription revenues projected between $3.26B and $3.265B in Q3 2025.
- Non-GAAP operating margin expected at 30.5%.
- Full-year subscription revenues forecasted at $12.775B to $12.795B.
- Strong momentum in CRM and AI agent adoption supports growth.
- Large customer cohort renewal expected in Q4 2025, boosting RPO.
Challenges Ahead
- Q3 2025 will face ~2 points of headwinds to cRPO growth due to contract wind-downs.
- US Federal agencies facing budget tightening may impact growth.
- Q3 cRPO growth guided at 18.5%, slower than Q2 2025 levels.
- Ongoing macroeconomic uncertainties remain a risk.
- Potential foreign currency fluctuations may affect reported revenues.
Revenue & Expenses
Visualization of income flow from segment revenue to net income