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Servicenow Inc Up 14.26% To $418.36 After Earnings Beat

Thursday, October 27, 2022 09:41 AM | InvestorsObserver Analysts

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Servicenow Inc Up 14.26% To $418.36 After Earnings Beat

Thursday, October 27, 2022 - Servicenow Inc (NOW) reported upside earnings and downside revenues.

Servicenow Inc's earnings came in at an EPS of $1.96 per share, 6.00% higher than estimates for an EPS of $1.85 per share. The firm's earnings are up 26% since reporting $1.55 per share in the same period a year ago. Remember, earnings reported were on an adjusted basis, so they may not be comparable to prior reports and/or analyst estimates.

Consensus estimates for Servicenow Inc revenue averaged out to $1.9 billion, with the business missing on those expectations with reported third-quarter revenue of $1.8 billion. The $19 million (1%) negative revenue surprise led to 21% growth year-over-year as the firm reported revenue of $1.5 billion in its year-ago quarter. The higher earnings growth compared to revenue points to Servicenow Inc improving its profit margin.

The stock is up 14.26% to $418.36 after the report.

The firm's lower revenue growth to earnings signals that the firm has been able to reduce costs and improve its profit margin overall.

The average recommendation from Wall Street analysts was a Strong Buy which may get revised based on this new data.

Trading in the five days leading up to the report earned Servicenow Inc a Bullish Sentiment Rank from InvestorsObserver.

Prior to the report, InvestorsObserver gave the stock an overall score of 37. Meanwhile, the average Wall Street analyst rated the stock a Strong Buy.

ServiceNow Inc provides software solutions to structure and automate various business processes via a SaaS delivery model. The company primarily focuses on the IT function for enterprise customers. ServiceNow began with IT service management (ITSM), expanded within the IT function, and more recently directed its workflow automation logic to functional areas beyond IT, notably customer service, HR service delivery, and security operations. ServiceNow also offers an application development platform as a service (PaaS).

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