ServiceNow's post-earnings results fell short of expectations, with slowing order growth dragging its stock down more than 20%.

BlockBeats news, October 29 — ServiceNow (NOW) released its third-quarter earnings report after market close on October 28 Eastern Time. The company's revenue grew 20.5% year-over-year to $4.106 billion, slightly above the market expectation of $4.09 billion; adjusted earnings per share were $1, below the expected $1.02. Although the company raised its full-year subscription revenue and free cash flow margin guidance, its stock price still fell sharply after hours.

The market is concerned about a slowdown in future order growth. The company expects fourth-quarter current remaining performance obligations (cRPO, i.e., contracted revenue expected to be recognized over the next 12 months) to grow 18.5% at constant currency, lower than 21% in the third quarter. The midpoint of its full-year subscription revenue guidance was also raised by only $15 million to $15.785 billion, indicating limited adjustment in management's expectations for short-term growth.

On the earnings call, analysts further pressed on when the AI business would significantly drive the company's overall revenue and order growth. Management explained that some fourth-quarter renewals were pulled forward into the third quarter, a higher proportion of on-premise deployment orders, and revenue classification changes caused by deployment services attached to large AI projects all affected short-term metrics. Among these, deployment services are expected to drag down fourth-quarter subscription revenue growth by about 0.5 percentage points.

According to TradingBeats monitoring, the NOW contract deployed by Trade.xyz was last quoted at $122.33, down about 20.50% in 24 hours, with trading volume of about $4.24 million during the same period and notional open interest of about $3.14 million.