ServiceNow Crushes Q2, Raises 2026 Outlook as AI ACV Tops $1B
NOW sits 23% above its 52-week low of $81.24.
Summary
ServiceNow reported Q2 2026 subscription revenue of $3.88B (+24.5% YoY), beating guidance, and raised its full-year outlook. AI annual contract value surpassed $1B, and the company set a long-term target of $30B+ in subscription revenue by 2030.
Key Events · Earnings and Guidance · NOW
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Q2 Beat Across All Metrics
Subscription revenues of $3,877M grew 24.5% YoY, exceeding the high end of guidance by 150 bps. Non-GAAP diluted EPS of $0.90 beat estimates.
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AI ACV Surpasses $1B
ServiceNow AI crossed $1 billion in annual contract value, with agentic deployments increasing ninefold in nine months, driving broad-based demand.
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Raised Full-Year 2026 Guidance
Full-year subscription revenue guidance raised to $15,760M–$15,780M (22.5% YoY growth). Non-GAAP operating margin guidance of 31.5% and free cash flow margin of 35%.
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Record Remaining Performance Obligations
cRPO of $13.20B (21% YoY growth) and total RPO of $29.0B (21% YoY growth), reflecting strong demand and longer customer commitments.
Analysis · NOW · Technology
A standout quarter saw ServiceNow beat the high end of its own guidance on every topline and profitability metric. Subscription revenue grew 24.5% to $3.88 billion, fueled by accelerating AI adoption—ServiceNow AI crossed $1 billion in annual contract value. The company raised its full-year subscription revenue forecast and issued Q3 guidance above consensus. With $29 billion in remaining performance obligations and a new long-term target of $30 billion+ in subscription revenue by 2030, the results reinforce ServiceNow's position as the fastest-growing major enterprise software company. The stock is likely to react positively to the beat-and-raise and the AI momentum.
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In the 30 days to Oct 1, 2026, 36.1% of the 1051 measured filings Wiseek scored 8 moved their stock by 5% or more by the next session's close. The median move was -0.56%. These are measured outcomes after filings of this importance, not a forecast for this one.
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At the time of this filing, NOW was trading at $99.96 on NYSE in the Technology sector, with a market capitalization of approximately $98.4B. The 52-week trading range was $81.24 to $210.20. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.