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ServiceNow shares rebound as subscription revenue and RPO rise
In Q2, subscription revenue increased 23.0% year over year and remaining performance obligations totaled $13.2 billion, supporting revenue visibility.
ServiceNow (NOW) shares have rebounded strongly after earlier underperformance, with the stock up 57.4% from its low of $81.24, according to Yahoo Finance.
The sell-off earlier in the year was linked to a broader shift in investor sentiment toward enterprise software stocks, as concerns grew that AI powered agents could disrupt traditional vendors. Margin pressure also weighed on the shares, the outlet said.
Yahoo Finance highlights that ServiceNow’s operating momentum has remained solid, driven by rising subscription revenue and an upbeat outlook. In Q2, subscription revenue reached $3.975 billion, up 23.0% year over year on a constant currency basis.
The outlet also pointed to earnings visibility from remaining performance obligations, which totaled $13.2 billion. It added that 18 of ServiceNow’s top 20 deals included at least eight products, with IT Service Management in 15 of the top 20 deals and IT Operations Management in 18.