ServiceNow reported 20% year-over-year revenue growth for the third quarter, beating the high end of its guidance across topline growth and profitability measures. The company also raised its full-year subscription-revenue and free-cash-flow-margin outlook, and lifted its 2026 target for annual contract value from AI products.
-
Revenue: Subscription revenue was $3.988 billion, up 21% from a year earlier, or 20.5% in constant currency. Total revenue reached $4.106 billion, up 20.5%, or 20% in constant currency.
-
Contracted revenue: Current remaining performance obligations—contracted revenue expected to be recognized over the next 12 months—stood at $13.65 billion, up 20.5% year over year, or 21% in constant currency. Total remaining performance obligations were $29.7 billion, up 22%, or 22.5% in constant currency.
-
Large customer commitments: ServiceNow completed 19 transactions representing more than $5 million each in net new annual contract value during the quarter, an increase of more than 135% year over year. It ended the quarter with 680 customers generating more than $5 million in annual contract value, up about 23%.
-
AI target: The company raised its 2026 target for AI annual contract value to $1.7 billion, 70% above the target it had at the start of the year.
-
Updated outlook: ServiceNow raised its full-year subscription-revenue and free-cash-flow-margin outlook. The release details provided here do not include the revised figures.
The results show growth in both recognized subscription sales and contracted business yet to be recognized as revenue. The higher AI annual-contract-value target and growth in large customer commitments also indicate that AI-related offerings and sizable enterprise deals are becoming more prominent in ServiceNow’s business.