ServiceNow (NOW) Q4 Earnings Report Preview: What To Look For

Enterprise workflow automation company ServiceNow (NYSE:NOW) will be reporting results this Wednesday afternoon. Here’s what to expect.

ServiceNow beat analysts’ revenue expectations by 1.4% last quarter, reporting revenues of $3.41 billion, up 21.8% year on year. It was a satisfactory quarter for the company, with an impressive beat of analysts’ EBITDA estimates but a significant miss of analysts’ billings estimates.

Is ServiceNow a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, analysts are expecting ServiceNow’s revenue to grow 19.4% year on year to $3.53 billion, slowing from the 21.3% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.89 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. ServiceNow has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 1.1% on average.

With ServiceNow being the first among its peers to report earnings this season, we don’t have anywhere else to look to get a hint at how this quarter will unravel for productivity software stocks. However, the whole sector has faced a sell-off over the last month with stocks in ServiceNow’s peer group down 6.8% on average. ServiceNow is down 11.4% during the same time and is heading into earnings with an average analyst price target of $206.29 (compared to the current share price of $136.99).

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