ServiceNow reported a solid Q4 2024, underscoring the continued strength of the Now Platform across enterprise workflows. Revenue of $2.957 billion rose 21.3% year-over-year and 5.7% quarter-over-quarter, while gross margins held near 78.7%, supporting operating leverage even as operating expenses remained elevated. Net income of $384 million and an EPS of $1.86 (diluted $1.84) contributed to a free cash flow generation of approximately $1.382 billion, with operating cash flow of $1.635 billion and free cash flow per share of about $6.71. The balance sheet remains highly liquid, with cash and short-term investments totaling roughly $5.762 billion and a net cash position of about $26 million, against modest debt of $2.177 billion. The quarterly results reinforce ServiceNow’s position as a platform-centric, enterprise-grade automation leader, leveraging strong margin discipline and robust cash generation to fund R&D and GTM investments.
Key Performance Indicators
Revenue
Increasing
2.96B
QoQ: 5.72% | YoY: 21.34%
Gross Profit
Increasing
2.33B
78.66% margin
QoQ: 5.11% | YoY: 21.08%
Operating Income
Increasing
374.00M
QoQ: -10.53% | YoY: 38.52%
Net Income
Increasing
384.00M
QoQ: -11.11% | YoY: 30.17%
EPS
Increasing
1.86
QoQ: -11.43% | YoY: 29.17%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue: $2.957B in Q4 2024, YoY +21.34%, QoQ +5.72%. Gross Profit: $2.326B, Gross Margin 78.66%, YoY +21.08%, QoQ +5.11%. Operating Income: $374M, Margin 12.65%, YoY +38.52%, QoQ -10.53%. Net Income: $384M, Margin 12.99%, YoY +30.17%, QoQ -11.11%. EPS: $1.86 (GAAP), Diluted $1.84, YoY +29.17%, QoQ -11.43%. Cash Flow and liquidity: Operating cash flow $1.635B; Free cash flow $1.382B; Capex $253M; FCF Margin ~46.8% of revenue. Balance sheet highlights: Total assets $20.383B; cash and short-term investments $5.762B; total current liabilities $8.358B; long-term debt $2.176B; total liabilities $10.774B; total stockholders’ equity $9.609B. Leverage and profitability: EBITDA $622M (EBITDA margin ~21.0%), net income margin ~13.0%. Valuation context: Price-to-Sales ~74x, Price-to-Earnings ~142x, Enterprise Value Multiple ~366x, indicating a premium valuation typical of cloud platform leaders with strong ARR growth.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
2.96B
21.34%
5.72%
Gross Profit
2.33B
21.08%
5.11%
Operating Income
374.00M
38.52%
-10.53%
Net Income
384.00M
30.17%
-11.11%
EPS
1.86
29.17%
-11.43%
Key Financial Ratios
Gross Profit Margin
Excellent
78.70%
Gross profit margin is exceptional, indicating strong pricing power and operational efficiency
Operating Profit Margin
Fair
12.60%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Good
13.00%
Net profit margin is healthy and competitive within industry standards
Return on Assets
Weak
1.88%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
4.00%
Return on equity suggests inefficient capital allocation
Current Ratio
Adequate
1.04
Current ratio meets minimum requirements but limited cushion
Debt to Equity
Conservative
0.24
Debt-to-equity shows conservative leverage and low financial risk
P/E Ratio
High Growth
142.42x
Very high P/E indicates aggressive growth expectations, higher risk
Price to Book
High Premium
22.77x
Very high premium suggests asset-light business model or lofty expectations
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