ServiceNow subscription revenue rises 24.5% to $3.88B

• ServiceNow reported Q2 subscription revenue of $3.88 billion, up 24.5%, while total revenue increased 24% to $3.99 billion.
• The stock closed 6.5% lower at $95.41 before the after-market earnings announcement.
• ServiceNow raised its full-year subscription revenue outlook after its AI business crossed $1 billion in annual contract value.

ServiceNow (NYSE:NOW) reported second-quarter subscription revenue of $3.88 billion, up 24.5%, as total revenue increased 24% to $3.99 billion.

Subscription revenue exceeded ServiceNow’s previous $3.815 billion–$3.820 billion guidance and rose from $3.11 billion one year earlier.

Current remaining performance obligations increased 21% to $13.20 billion, including constant-currency growth of 21.5%.

Total remaining performance obligations reached $29 billion, up 21%, while ServiceNow said its AI products crossed $1 billion in annual contract value.

ServiceNow generated $3.67 billion in subscription revenue during Q1, when current and total remaining performance obligations reached $12.64 billion and $27.7 billion.

ServiceNow raised its full-year subscription revenue outlook above the $15.735 billion–$15.775 billion range issued after its first-quarter results.