ServiceNow Shares Higher After Earnings Beat
January 27 2022 - 11:36AM
Dow Jones News
By Michael Dabaie
ServiceNow Inc. shares were up 10.7%, to $536.43, in late
morning trading after earnings came in above analyst views.
The digital workflow company after the bell Wednesday reported
fourth-quarter total revenue of $1.61 billion, up 29% and above
FactSet consensus for $1.6 billion. Subscription revenue was up
29%, to $1.52 billion.
Adjusted EPS came to $1.46, better than FactSet consensus of
$1.43.
ServiceNow guided for first quarter subscription revenue of
$1.61 billion to $1.615 billion for 25% growth and full year
subscription revenue of $7.02 billion to $7.04 billion for 26%
growth.
"In light of the recent software bear market, investors have
been worried that there would be a fall-off in fundamentals as we
move out of the pandemic. But the results at ServiceNow show what
our primary research across our coverage has indicated, and that is
that fundamentals remain very good," J.P. Morgan said in an analyst
note.
Truist Securities said core strength drove strong momentum into
2022.
"Despite FX headwinds stemming from their global presence, the
company continues to produce beat-and-raise quarters benefiting
from both new customers and significant upsell. While fundamental
performance on the quarter was driven largely from the strength of
their core offering, commentary on the call made us incrementally
optimistic about new product opportunities in the year ahead,"
Truist said.
Stifel said in a note that "Net/net we expect that ServiceNow's
rapidly expanding platform, growing pipeline, and large deal
momentum should enable the company to maintain 20%+ revenue growth
and significant margin expansion in coming years."
Write to Michael Dabaie at michael.dabaie@wsj.com
(END) Dow Jones Newswires
January 27, 2022 11:21 ET (16:21 GMT)
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