ServiceNow NOW reported third-quarter 2026 non-GAAP earnings of $1.00 per share, up 5.3% year over year. The figure missed the Zacks Consensus Estimate by 1.96%.
Revenues of $4.11 billion increased 20.5% year over year and surpassed the consensus mark by 0.46%. Results benefited from strong subscription demand and accelerating AI adoption. Current remaining performance obligations (cRPO) reached $13.65 billion.
NOW Benefits From Strong Subscription Revenue Growth
Subscription revenues increased 21% year over year to $3.99 billion. At constant currency (cc), subscription revenues grew 20.5%, exceeding the high end of management’s guidance by 50 basis points (bps).
ServiceNow, Inc. Price, Consensus and EPS Surprise
ServiceNow, Inc. price-consensus-eps-surprise-chart | ServiceNow, Inc. Quote
Professional services and other revenues advanced 10% year over year to $118 million.
ServiceNow attributed its subscription outperformance to broad demand across enterprise workflows and AI solutions. However, investments in deployment expertise shifted approximately 25 bps of subscription revenue growth to professional services revenues as the company accelerated AI implementation for select large customers.
ServiceNow Expands Backlog and Large Customer Deals
In the third quarter of 2026, cRPO, representing contracted revenues expected to be recognized within 12 months, grew 20.5% year over year. At cc, the metric increased 21%, exceeding guidance by 100 bps. Total remaining performance obligations (RPO) increased 22% year over year to $29.7 billion, or 22.5% at cc.
NOW recorded 19 transactions exceeding $5 million in net new annual contract value (ACV), up more than 135% year over year. The company ended the quarter with 680 customers generating more than $5 million in ACV, an increase of approximately 23%.
ServiceNow maintained a 98% renewal rate. Additionally, 19 of its top 20 deals included six or more products, reflecting continued expansion among large enterprise customers.
NOW Sees Accelerating AI and Workflow Adoption
ServiceNow’s AI net new ACV increased 65% year over year. Deals exceeding $1 million in AI ACV grew 4.5 times, while transactions involving five or more AI products increased more than 8.5 times. Year-to-date agentic AI consumption in production surged more than 13 times.
Demand remained broad across workflows. IT Service Management appeared in 11 of the top 20 deals, while IT Operations Management featured in nine. Security and Risk solutions were included in 16 deals, while CRM and industry workflows appeared in 13.
NOW also witnessed strong momentum in emerging AI offerings. Control Tower net new ACV grew more than sixfold year over year, while EmployeeWorks reached $100 million in ACV in less than three quarters.
