ServiceNow beats Q3 earnings expectations

With more than 22 deals worth more than $1 million for the quarter, ServiceNow posts strong growth in subscription billings.

ServiceNow on Wednesday published its third quarter financial results, beating earnings expectations for the quarter.

The company reported non-GAAP net income of $69.3 million, or earnings of 40 cents per basic share and 38 per diluted share. Non-GAAP revenues came to $491.4 million, representing 37 percent year-over-year growth adjusted for constant currency.

Wall Street was looking for second quarter non-GAAP earnings per share of 32 cents a share on sales of $491.65 million.


The company achieved $499.7 million of non-GAAP subscription billings, representing 38 percent year-over-year growth. Non-GAAP subscription revenues came to $449.5 million, representing 41 percent year-over-year growth adjusted for constant currency. CFO Michael Scarpelli said the strong quarter was driven by large new deals, including 22 greater than $1 million.

In a statement, CEO John Donahoe noted the company had a strong third quarter across every region. He also highlighted the company's investments in innovations like machine learning, making such technology native to all applications on the ServiceNow platform.

"We are committed to being a trusted cloud partner for our customers helping them navigate digital transformation and create the future of work," he said.

For the fourth quarter of 2017, ServiceNow expects to see total non-GAAP revenues between $517 and $522 million, representing 34 percent to 35 percent. year-over-year growth. For the full 2017 fiscal year, it expects non-GAAP total revenues between $1.911 billion and $1.916 billion, representing 37 percent to 38 percent year-over-year growth.