Bill McDermott named ServiceNow CEO days after leaving SAP

McDermott will replace John Donahoe, who is stepping down from his role leading ServiceNow to become the CEO of Nike.

SAP's departing CEO Bill McDermott has been named the next chief executive of ServiceNow, the company announced Tuesday. McDermott will replace John Donahoe, who is stepping down from his role leading ServiceNow to become the CEO of Nike, according to a statement

ServiceNow, makers of a cloud automation platform used for IT service and other functions, said McDermott will join ServiceNow following his transition from SAP. Donahoe served as the company's chief executive since 2017, following his role as CEO of eBay. Donahoe has served as a Nike board member since 2014.

In prepared remarks, McDermott said he was "fired up" to take the helm of "one of the most exciting innovation and growth companies in the world".

"The company has a transformational platform, immensely talented colleagues and limitless potential," McDermott said. "Fred Luddy has given us an enduring foundation on which to build the company's bright future. I consider it a personal honor to succeed John and help carry ServiceNow's proud legacy forward to the next chapter. I'm fired up and can't wait to get started!"

On Wednesday, the company delivered better-than-expected third quarter financial results. ServiceNow reported a net income of $40.5 million, or 21 cents a share, on revenue of $885.8 million, up 32% from a year ago. Non-GAAP earnings for the third quarter were 99 cents a share. 

Wall Street was looking for non-GAAP earnings of 88 cents a share on revenue of $884.96 million.

The company said subscription billings were $864 million and grew 28% year-over-year. Subscription revenue was $834.9 million, up 33% from a year ago.

During the quarter, ServiceNow said it closed 46 transactions with more than $1 million in net new annual contract value. The company has 809 total customers with more than $1 million in ACV, representing 32% year-over-year growth in customers.

Shares of ServiceNow were up around 3% after hours. 

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