ServiceNow (NYSE:NOW) Shares Gap Up on Earnings Beat

ServiceNow, Inc. (NYSE:NOW)’s stock price gapped up prior to trading on Thursday following a better than expected earnings announcement. The stock had previously closed at $95.46, but opened at $100.01. ServiceNow shares last traded at $97.0110, with a volume of 13,222,877 shares.

The information technology services provider reported $0.90 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.86 by $0.04. ServiceNow had a return on equity of 18.16% and a net margin of 12.59%.The company had revenue of $3.99 billion during the quarter, compared to the consensus estimate of $3.93 billion. During the same period last year, the company earned $0.81 earnings per share. The firm’s revenue was up 24.0% compared to the same quarter last year.

Key Stories Impacting ServiceNow

Here are the key news stories impacting ServiceNow this week:

• Positive Sentiment: ServiceNow beat Q2 profit and revenue estimates, showing demand for its workflow automation software remains strong. ServiceNow Reports Second Quarter 2026 Financial Results
• Positive Sentiment: The company raised its subscription revenue forecast again, suggesting AI-powered products are driving faster growth than expected. ServiceNow raises annual subscription revenue forecast again on AI-driven demand
• Positive Sentiment: AI contract value crossed the $1 billion mark and backlog/remaining performance obligations remained strong, reinforcing the long-term revenue outlook. ServiceNow AI Contract Value Crosses $1 Billion Milestone, Stock Soars
• Positive Sentiment: Several analysts reaffirmed bullish ratings and lifted price targets after the results, which can help sustain momentum. Analyst rating updates

Wall Street Analyst Weigh In

Several equities analysts recently issued reports on the stock. Bank of America initiated coverage on shares of ServiceNow in a report on Monday, May 18th. They issued a “buy” rating and a $130.00 target price on the stock. Evercore reiterated an “outperform” rating on shares of ServiceNow in a report on Thursday. Capital One Financial lifted their price objective on ServiceNow from $105.00 to $120.00 and gave the stock an “overweight” rating in a research report on Tuesday, May 5th. Raymond James Financial dropped their price objective on ServiceNow from $160.00 to $130.00 and set an “outperform” rating on the stock in a research note on Thursday, April 23rd. Finally, Oppenheimer reaffirmed an “outperform” rating and set a $140.00 target price (up from $130.00) on shares of ServiceNow in a research note on Wednesday, July 15th. One analyst has rated the stock with a Strong Buy rating, thirty-six have issued a Buy rating, two have given a Hold rating and three have assigned a Sell rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $142.56.

Insider Transactions at ServiceNow

In related news, Director Paul Edward Chamberlain sold 1,500 shares of the business’s stock in a transaction dated Thursday, May 14th. The stock was sold at an average price of $87.23, for a total value of $130,845.00. Following the completion of the sale, the director directly owned 44,930 shares of the company’s stock, valued at $3,919,243.90. The trade was a 3.23% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Anita M. Sands sold 16,445 shares of the company’s stock in a transaction that occurred on Thursday, May 14th. The stock was sold at an average price of $90.14, for a total value of $1,482,352.30. Following the transaction, the director directly owned 30,090 shares in the company, valued at approximately $2,712,312.60. This trade represents a 35.34% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last 90 days, insiders have sold 28,071 shares of company stock valued at $2,529,956. 0.34% of the stock is currently owned by corporate insiders.

Institutional Trading of ServiceNow

Several hedge funds have recently bought and sold shares of the business. Vanguard Group Inc. raised its holdings in ServiceNow by 404.5% during the fourth quarter. Vanguard Group Inc. now owns 101,963,384 shares of the information technology services provider’s stock worth $15,619,771,000 after buying an additional 81,752,460 shares during the last quarter. State Street Corp grew its holdings in shares of ServiceNow by 406.6% during the fourth quarter. State Street Corp now owns 47,896,597 shares of the information technology services provider’s stock valued at $7,337,280,000 after buying an additional 38,441,898 shares during the last quarter. Price T Rowe Associates Inc. MD grew its holdings in shares of ServiceNow by 371.0% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 32,395,663 shares of the information technology services provider’s stock valued at $4,962,692,000 after buying an additional 25,517,218 shares during the last quarter. Geode Capital Management LLC increased its position in shares of ServiceNow by 404.8% during the fourth quarter. Geode Capital Management LLC now owns 23,512,428 shares of the information technology services provider’s stock worth $3,591,425,000 after acquiring an additional 18,854,775 shares in the last quarter. Finally, Morgan Stanley increased its position in shares of ServiceNow by 335.6% during the fourth quarter. Morgan Stanley now owns 22,733,483 shares of the information technology services provider’s stock worth $3,482,543,000 after acquiring an additional 17,514,679 shares in the last quarter. Institutional investors and hedge funds own 87.18% of the company’s stock.

ServiceNow Stock Up 2.3%

The company has a debt-to-equity ratio of 0.13, a quick ratio of 0.84 and a current ratio of 0.84. The company has a market cap of $100.68 billion, a price-to-earnings ratio of 58.20, a price-to-earnings-growth ratio of 1.71 and a beta of 0.96. The stock’s fifty day moving average is $104.67 and its two-hundred day moving average is $108.16.

About ServiceNow

ServiceNow (NYSE: NOW) is a cloud computing company that builds enterprise software to manage digital workflows and automate business processes. Its offerings are designed to replace manual work and legacy systems with cloud-based, service-oriented applications that support IT operations, customer service, human resources, security response and other enterprise functions.

The company’s flagship product family is the Now Platform, a suite of subscription software and platform services that includes IT Service Management (ITSM), IT Operations Management (ITOM), IT Business Management (ITBM), Customer Service Management (CSM), HR Service Delivery, Security Operations and Asset Management.