[Yumi's Pick] AIBoosts ServiceNow's Results... New Growth Is 'Homework'

ServiceNow reported annual contract value (ACV) for its AI products exceeding $1 billion, surpassing market expectations. Subscription revenue grew 24.5% YoY to $3.877 billion, with adjusted EPS of $0.90 beating forecasts. Recurring revenue rose 24% to $3.877 billion, while remaining performance obligation (RPO) grew 21% to $13.2 billion. Large contracts increased, with 123 deals exceeding $1 million in ACV, and 658 customers spending over $500,000. AI-related ACV grew 40% QoQ, with 5+ product contracts up 5.5x YoY. However, AI ACV growth may reflect existing customers upgrading rather than new acquisition. ServiceNow's 3Q subscription revenue guidance of $3.975-3.98 billion falls below market expectations of ~$4.01 billion.