Photo Credit: Donny Gonzo / Flickr.com

The tech industry may be preparing for worsening economic conditions, but one player seems to be above all these concerns. ServiceNow (NYSE: NOW) recently reported its fourth-quarter results that continued to outpace market expectations. The company’s growth metrics were well above SaaS peers in FY22, and it is expected to maintain strong growth in the coming year. It did, however, fail to meet market expectations on the outlook.

ServiceNow’s Financials

For the fourth quarter of the year, ServiceNow’s revenues grew 25.5% to $1.94 billion, ahead of the market’s forecast by 0.32%. EPS of $2.28 was also ahead of the market’s estimates of $2.01.

By segment, subscription revenues grew 27.5% to $1.86 billion and professional and other services revenues fell 6.5% to $85 million. It added 1,637 customers and generated more than $1 million in ACV.  

Annual revenue for FY22 grew 28% to $7.5 billion. Non-GAAP net income was $1.5 billion or $7.59 per share.

For the first quarter, ServiceNow forecast subscription revenues of $1.99-$2.00 billion. For the fiscal year, it expects subscription revenues of $8.44-$8.5 billion. The outlook fell short of the market predictions. The market expects ServiceNow to deliver revenues of $8.77 billion and an EPS of $8.98 for the year and revenues of $2.06 billion and an EPS of $2.05 for the quarter.

Overall, it was still a stellar quarter, and a stellar year for ServiceNow. It delivered a growth of 28% on current remaining performance obligations (cRPO) on a constant currency basis. The Q4 ending cRPO balance of $6.9 billion grew 25.5% over the year on a constant currency basis, falling marginally short of the management’s guidance of 26% growth. The Q4 ending cRPO balance accounted for 82% of guided subscription revenues for FY23, ahead of the 5-year average coverage of 78%. Clearly, ServiceNow will continue to deliver strong growth even amid economic concerns.

ServiceNow’s Product Expansion using Machine Learning

Recently, ServiceNow announced new solutions to help digitize productivity challenges. Automated service suggestions, Service Request Playbook, and Workplace Scenario Planning are all built on the ServiceNow platform, and accelerate automation of complex processes for enterprises and government agencies, improving service operations in addition to customer, employee, and constituent experiences.

Available through Service Mapping Plus, Automated service suggestions uses machine learning to automatically analyze an organization’s network traffic and suggest entry points for business-critical services. IT departments have the ability to create a high-fidelity service map of infrastructure and middleware, saving time and money, while also generating more accurate enterprise-wide mapping, arming organizations with service-relevant insights needed to make decisions and respond to emergent IT events quickly.

Service Request Playbook is built on ServiceNow Public Sector Digital Services and is a pre-packaged application purpose-built to digitize and automate their service request process, helping government workers improve efficiency and consistency, while also empowering them to monitor the progress of back-office teams.

A part of Workplace Service Delivery, Workplace Scenario Planning helps organizations operate more strategically across workspace planning efforts, allowing them to better manage spend and improve the office experience. Space planners have the ability to design, compare, and experiment with various space allocation scenarios with a visual drag-and-drop interface before deploying changes in an office. This allows them to optimize space and save money and provides a more collaborative and productive office experience.

Its stock is currently trading at $442.57 with a market capitalization of $89.4 billion. It had climbed to a 52-week high of $621.41 in February last year and hit a 52-week low of $337.00 in October last year.

More By This Author:

Cloud Stocks: Microsoft Challenges Google With OpenAI Partnership
Netflix Focuses On Improving Monetization
Cloud Stocks: BlackLine Expands Product Line-Up With AI And AR Tools