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The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $2.27 billion, up 24.09% from the figure reported in the year-ago quarter.
The consensus mark for third-quarter earnings is pegged at $2.54 per share over the past 30 days, indicating growth of 29.59% from the figure reported in the year-ago quarter.
ServiceNow’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 12.79%.
Let’s see how things are shaping up for ServiceNow prior to this announcement.
Factors at Play
ServiceNow’s third-quarter 2023 results are expected to benefit from expanding clientele. It has been gaining from the rising adoption of its workflows by enterprises undergoing digital transformation.
The availability of new solutions — Automated service suggestions, Service Request Playbook and Workplace Scenario Planning — is helping the company win new customers. It had 1,724 total customers with more than $1 million in annual contract value at the end of the second quarter.
For third-quarter 2023, subscription revenues are projected between $2.185 billion and $2.195 billion, suggesting an improvement in the range of 25.5-26% year over year on a GAAP basis. At constant currency, subscription revenues are expected to grow in the 23-23.5% range.
Our model estimate for third-quarter subscription revenues is pegged at $2.19 billion, suggesting 25.9% year-over-year growth.
ServiceNow’s expanding global presence, solid partner base and strategic buyouts are expected to have bolstered its top-line growth in the third quarter of 2023.
Key Q3 Developments
During the to-be-reported quarter, ServiceNow announced a comprehensive new automation solution in the Now Platform Vancouver release. It announced a major Now Platform expansion with the Now Assist family of solutions. Available in the Now Platform Vancouver release, Now Assist for IT Service Management, Customer Service Management, HR Service Delivery and Creator embed the power of generative AI across all workflows on the Now Platform.
Moreover, ServiceNow and KPMG announced an expanded partnership related to finance, supply chain and procurement operations.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
ServiceNow has an Earnings ESP of -2.30% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Image: Bigstock
ServiceNow (NOW) to Report Q3 Earnings: What's in the Cards?
ServiceNow (NOW - Free Report) is scheduled to release its third-quarter 2023 results on Oct 25.
The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $2.27 billion, up 24.09% from the figure reported in the year-ago quarter.
The consensus mark for third-quarter earnings is pegged at $2.54 per share over the past 30 days, indicating growth of 29.59% from the figure reported in the year-ago quarter.
ServiceNow’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 12.79%.
ServiceNow, Inc. Price and EPS Surprise
ServiceNow, Inc. price-eps-surprise | ServiceNow, Inc. Quote
Let’s see how things are shaping up for ServiceNow prior to this announcement.
Factors at Play
ServiceNow’s third-quarter 2023 results are expected to benefit from expanding clientele. It has been gaining from the rising adoption of its workflows by enterprises undergoing digital transformation.
The availability of new solutions — Automated service suggestions, Service Request Playbook and Workplace Scenario Planning — is helping the company win new customers. It had 1,724 total customers with more than $1 million in annual contract value at the end of the second quarter.
For third-quarter 2023, subscription revenues are projected between $2.185 billion and $2.195 billion, suggesting an improvement in the range of 25.5-26% year over year on a GAAP basis. At constant currency, subscription revenues are expected to grow in the 23-23.5% range.
Our model estimate for third-quarter subscription revenues is pegged at $2.19 billion, suggesting 25.9% year-over-year growth.
ServiceNow’s expanding global presence, solid partner base and strategic buyouts are expected to have bolstered its top-line growth in the third quarter of 2023.
Key Q3 Developments
During the to-be-reported quarter, ServiceNow announced a comprehensive new automation solution in the Now Platform Vancouver release. It announced a major Now Platform expansion with the Now Assist family of solutions. Available in the Now Platform Vancouver release, Now Assist for IT Service Management, Customer Service Management, HR Service Delivery and Creator embed the power of generative AI across all workflows on the Now Platform.
Moreover, ServiceNow and KPMG announced an expanded partnership related to finance, supply chain and procurement operations.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
ServiceNow has an Earnings ESP of -2.30% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
GoDaddy (GDDY - Free Report) has an Earnings ESP of +14.09% and sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
GoDaddy shares have gained 0.9% year to date. GDDY is set to report its third-quarter 2023 results on Nov 2.
Pinterest (PINS - Free Report) has an Earnings ESP of +4.76% and a Zacks Rank #1.
Pinterest shares have gained 9.3% year to date. PINS is set to report its third-quarter 2023 results on Oct 30.
Meta Platforms (META - Free Report) has an Earnings ESP of +3.98% and has a Zacks Rank of 3 at present.
Meta shares have gained 159.9% year to date. META is set to report its third-quarter 2023 results on Oct 25.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.