Business Emerge, July 25: ServiceNow has revised its annual subscription revenue forecast, driven by increased enterprise adoption of AI-powered cloud-based software. The company’s shares surged by over 7% in extended trading and have shown a 3.5% increase this year, although they still trail behind the S&P 500 index.
In light of growing interest in workflow automation and advancements in generative AI, ServiceNow has demonstrated significant growth. Analysts predict that the rising U.S. federal business and the broader acceptance of AI software will help the company mitigate the challenges posed by the uncertain economic environment.
During an internal investigation, ServiceNow’s board identified policy violations related to the hiring of a former chief information officer of the U.S. Army. Consequently, the individual has left the company. Additionally, Chief Operating Officer CJ Desai has mutually agreed to resign from all positions immediately.
ServiceNow has also announced the acquisition of the search and retrieval platform Raytion, though the financial terms were not disclosed. Moreover, the company plans to invest strategically in Prodapt, which specializes in digital and network services for the telecom and technology sectors.
The company now forecasts its full-year subscription revenue to range between $10.575 billion and $10.585 billion, surpassing analysts’ estimates of $10.565 billion. Previously, the projection was between $10.560 billion and $10.575 billion. In the recent quarter, ServiceNow reported an adjusted earnings of $3.13 per share, beating the estimated $2.84 per share.