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Health Care : Health Care Equipment & Supplies | Mid Cap Growth
Company profile

Globus Medical, Inc. is a medical device company. The Company is focused on developing products for patients with musculoskeletal disorders. It is focused on products to treat patients with spine disorders. The Company's products fall under categories, which include Innovative Fusion and Disruptive Technologies. The Innovative Fusion category products include fusion products to treat spinal disorders for the entire spine, and they can be used in various surgical approaches. The Disruptive Technologies category represents a shift in the treatment of spinal disorders by allowing for surgical procedures and the treatment of spinal disorders. QUARTEX is its Occipito-Cervico-Thoracic (OCT) stabilization system. QUARTEX features a threading locking cap to enable low-torque. The Company's portfolio of approved and pipeline Disruptive Technology products includes products that allow for minimally invasive surgical (MIS) techniques.

Closing Price
$53.74
Day's Change
-1.06 (-1.93%)
Bid
--
Ask
--
B/A Size
--
Day's High
54.71
Day's Low
53.26
Volume
(Average)
Volume:
559,650

10-day average volume:
607,687
559,650

ServiceNow Reports Second Quarter 2020 Financial Results

4:10 pm ET July 29, 2020 (BusinessWire) Print

ServiceNow (NYSE: NOW), the leading digital workflow company making work, work better for people, today announced financial results for its second quarter ended June 30, 2020, with subscription revenues of $1,016 million in Q2 2020, representing 30% year-over-year growth, 32% adjusted for constant currency.

During the quarter, ServiceNow closed 40 transactions with more than $1 million, including two transactions over $10 million, in net new annual contract value (ACV). The company now has 964 total customers with more than $1 million in ACV, representing 26% year-over-year growth in customers.

"ServiceNow is leading the workflow revolution, proven by our very strong Q2 results," said ServiceNow CEO Bill McDermott. "Businesses need to rapidly digitize workflows to deliver great experiences for their customers, employees, and partners. We are the strategic workflow authority helping our customers solve once-in-a-generation challenges and capitalize on the immense opportunities of digital transformation. Every day we are manifesting our purpose -- making the world of work, work better for people -- on our journey to becoming the defining enterprise software company of the 21st century."

"In Q2, we achieved our $4 billion revenues run rate milestone. We exceeded the high end of our subscription revenues and billings guidance, while continuing to drive margin expansion and strong free cash flow," said ServiceNow CFO Gina Mastantuono. "Our best-in-class renewal rate remained at 97%, and customers continue to expand on the Now Platform, giving us conviction to raise our growth and profitability guidance for the year. I am confident in our ability to deliver our second half."

During the quarter, ServiceNow continued rapid innovation delivering the capabilities customers need to protect revenue, improve productivity, and ensure business resilience. The company released the Safe Workplace apps and dashboard, designed to help make returning to the workplace work for everyone. This suite has now been downloaded by more than 550 organizations worldwide. ServiceNow also hosted its Knowledge 2020 Digital Experience - its largest ever, creating a global digital broadcast environment to engage nearly double the number of customers and partners from last year. ServiceNow's core business remained very strong. With Now workflows on the Now Platform -- the platform of platforms -- ServiceNow is accelerating digital transformation for its customers by enabling the consumer-grade workflow experiences that are more important than ever for their employees and customers.

Second Quarter 2020 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the second quarter 2020:

                                  Second Quarter 2020                       Second Quarter 2020                                                                              Second Quarter 2020 Non-GAAP Results(1)
                                                        GAAP Results                              GAAP Results
                                                    -------------------- ------------------------------------------------------------                        --------------------------------------------------------------------------------------------------------------------------------------------
                                               Amount               Amount              Year/Year                 Amount              Year/Year               Adjusted               Adjusted
                                                            ($ millions)         ($ millions)                                Growth (%)                              ($ millions)                                Growth (%)                                    Amount                                 Year/Year
                                                                                                                                                                                                                                                      ($ millions)(2)                                Growth (%)
--------------------------------------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
                              Subscription revenues               $1,016               $1,016                  30%                  30%                       $1,027               $1,027                  32%                  32%
           Professional services and other revenues                  $55                  $55                   5%                   5%                          $56                  $56                   6%                   6%
                                     Total revenues               $1,071               $1,071                  28%                  28%                       $1,083               $1,083                  30%                  30%
                                                        
                              Subscription billings                         $1,018                  25%                  25%               $1,033               $1,033                  26%                  26%
           Professional services and other billings                            $61                  13%                  13%                  $62                  $62                  14%                  14%
                                     Total billings                         $1,079                  24%                  24%               $1,095               $1,095                  26%                  26%
                                                        
                                               Amount               Amount           Margin (%)           Margin (%)                 Amount           Margin (%)           Margin (%)        
                                                            ($ millions)         ($ millions)                                                                        ($ millions)
--------------------------------------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
                          Subscription gross profit                 $844                 $844                  83%                  83%                   $881                  87%                  87%        
Professional services and other gross profit (loss)                 ($6)                 ($6)                (10%)                (10%)                     $7                  13%                  13%        
                                 Total gross profit                 $838                 $838                  78%                  78%                   $888                  83%                  83%        
                             Income from operations                  $62                  $62                   6%                   6%                   $295                  28%                  28%        
          Net cash provided by operating activities                 $368                 $368                  34%                  34%                
                                     Free cash flow                           $259                  24%                  24%        
                                                        
                                               Amount               Amount         Earnings per         Earnings per                 Amount         Earnings per         Earnings per        
                                                            ($ millions)         ($ millions)        Basic/Diluted        Basic/Diluted                              ($ millions)        Basic/Diluted        Basic/Diluted
                                                                                                         Share ($)            Share ($)                                                      Share ($)            Share ($)
--------------------------------------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
(1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section entitled "Statement Regarding Use of Non-GAAP Financial Measures" for an explanation of non-GAAP measures, and the table entitled "GAAP to Non-GAAP Reconciliation" for a reconciliation of GAAP to non-GAAP measures.
(2) Non-GAAP adjusted subscription revenues, professional services and other revenues, total revenues and professional services and other billings are adjusted for constant currency. Non-GAAP adjusted subscription billings and total billings are adjusted for constant currency and constant billings duration. See the section entitled "Statement Regarding Use of Non-GAAP Financial Measures" for an explanation of non-GAAP measures, and the table entitled "GAAP to Non-GAAP Reconciliation" for a reconciliation of GAAP to non-GAAP measures.

Financial Outlook

Our guidance includes GAAP and non-GAAP financial measures.

The following table summarizes our guidance for the third quarter 2020:

     Third Quarter 2020                        Third Quarter 2020                        Third Quarter 2020 Non-GAAP Guidance(1)                                                      Third Quarter 2020 Non-GAAP Guidance(1)
                           GAAP Guidance                             GAAP Guidance
                       -------------------- ------------------------------------------------------------   --------------------------------------- --------------------------------------------------------------------------------------------------------------------------------------------
                  Amount               Amount            Year/Year            Year/Year                                  Amount               Amount            Year/Year            Year/Year             Adjusted             Adjusted             Adjusted             Adjusted
                            ($ millions)(2)      ($ millions)(2)           Growth (%)           Growth (%)                         ($ millions)(2)      ($ millions)(2)           Growth (%)           Growth (%)               Amount               Amount           Year/ Year           Year/ Year
                                                                                                                                                                                                                       ($ millions)(3)      ($ millions)(3)           Growth (%)           Growth (%)
---------------------- -------------------- -------------------- -------------------- -------------------- --------------------------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
 Subscription revenues      $1,055 - $1,060      $1,055 - $1,060            26% - 27%            26% - 27%                                 $1,055 - $1,060      $1,055 - $1,060            26% - 27%            26% - 27%
 Subscription billings                                   $995 - $1,015        $995 - $1,015            15% - 17%            15% - 17%      $1,003 - $1,023      $1,003 - $1,023            16% - 18%            16% - 18%
                                              
                                             Margin (%)           Margin (%)        
---------------------- -------------------- -------------------- -------------------- -------------------- --------------------------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Income from operations                                                 22%                  22%        
                                              
                                             Amount               Amount            
                                                                                                                                        (millions)           (millions)
---------------------- -------------------- -------------------- -------------------- -------------------- --------------------------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
(1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section entitled "Statement Regarding Use of Non-GAAP Financial Measures" for an explanation of non-GAAP measures, and the table entitled "Reconciliation of Non-GAAP Financial Guidance" for a reconciliation of GAAP to non-GAAP measures.
(2) Guidance for GAAP subscription revenues and non-GAAP subscription billings is based on foreign exchange rates as of June 30, 2020 for entities reporting in currencies other than U.S. Dollars.

The following table summarizes our guidance for full-year 2020:

          Full-Year 2020                            Full-Year 2020                                                                                   Full-Year 2020 Non-GAAP Guidance(1)
                              GAAP Guidance                             GAAP Guidance
                          -------------------- ------------------------------------------------------------                        --------------------------------------------------------------------------------------------------------------------------------------------
                     Amount               Amount            Year/Year            Year/Year                 Amount            Year/Year            Year/Year             Adjusted             Adjusted             Adjusted             Adjusted
                               ($ millions)(2)      ($ millions)(2)           Growth (%)           Growth (%)                           ($ millions)(2)           Growth (%)           Growth (%)               Amount               Amount           Year/ Year           Year/ Year
                                                                                                                                                                                                       ($ millions)(3)      ($ millions)(3)           Growth (%)           Growth (%)
------------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
    Subscription revenues      $4,185 - $4,200      $4,185 - $4,200                  29%                  29%              $4,210 - $4,225      $4,210 - $4,225            29% - 30%            29% - 30%
    Subscription billings                $4,660 - $4,700            23% - 24%            23% - 24%      $4,702 - $4,742      $4,702 - $4,742            24% - 25%            24% - 25%
                              
                             Margin (%)           Margin (%)        
------------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
Subscription gross profit                              86%                  86%        
   Income from operations                              24%                  24%        
           Free cash flow                            29.5%                29.5%        
                              
                               Amount            
                                                                                                                                             (millions)
------------------------- -------------------- -------------------- -------------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
(1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section entitled "Statement Regarding Use of Non-GAAP Financial Measures" for an explanation of non-GAAP measures, and the table entitled "Reconciliation of Non-GAAP Financial Guidance" for a reconciliation of GAAP to non-GAAP measures.
(2) GAAP subscription revenues and non-GAAP subscription billings for the future quarters included in our full-year 2020 guidance are based on foreign exchange rates as of June 30, 2020 for entities reporting in currencies other than U.S. Dollars.

As with our previously issued full-year 2020 guidance dated April 29, 2020, our guidance factors in assumptions regarding the expected impacts of COVID-19 on our business. This assumes that generally the most significant headwinds would occur in the second and third quarter of 2020, that there will be uncertainty around new business, renewal timing or billings terms, particularly with customers in industries highly affected by COVID-19, and that these economic conditions could persist throughout the remainder of the year. These assumptions are based on information available to us today. Significant variation from these assumptions could cause us to modify our guidance higher or lower.

The following table compares our updated full-year 2020 guidance against our previously issued full-year 2020 guidance dated April 29, 2020:

               Comparison of Updated Full-Year 2020 Guidance to Previously Issued Guidance(1)                                                        Comparison of Updated Full-Year 2020 Guidance to Previously Issued Guidance(1)
                                                                   ($ millions)                                                                                                                          ($ millions)
                                  ------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                            Previous Guidance    Previous Guidance     Currency Impact(3)     Duration Impact(4)        Guidance Change       Current Guidance
                                                                                                     Midpoint(2)          Midpoint(2)                                                                                                                                                             Midpoint(5)
--------------------------------- ------------------------------------------------------------------------------ -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- -------------------- --------------------
       GAAP subscription revenues                                                                         $4,135               $4,135                  $19                  $19                   $0                   $0                  $39                  $39               $4,193               $4,193
                                                                                            
Non-GAAP subscription billings(6)                                                                         $4,630               $4,630                  $22                  $22                   $0                   $0                  $28                  $28               $4,680               $4,680
(1) Numbers rounded for presentation purposes.
(2) Refers to previously issued full-year 2020 guidance dated April 29, 2020.
(3) GAAP subscription revenues and non-GAAP subscription billings for the future quarters included in our full-year 2020 guidance are based on foreign exchange rates in effect at the end of the current quarter for entities reporting in currencies other than U.S. Dollars. Currency impact represents the sum of (i) the impact of the difference between the actual average rates in the period used to calculate our Q2 2020 actual results and the rates as of March 31, 2020 assumed in our previously issued guidance dated April 29, 2020 plus (ii) the impact of the difference between the exchange rates in effect as of June 30, 2020 assumed in our updated full-year 2020 guidance, and the rates as of March 31, 2020 assumed in our previously issued guidance dated April 29, 2020.
(4) Represents the impact of billings greater than 12 months in excess of guidance assumptions.
(5) Represents the updated full-year 2020 guidance presented in the table above.

Conference Call Details

The conference call will begin at 2 p.m. Pacific Time (22:00 BST) on July 29, 2020. Interested parties may listen to the call by dialing (833) 513-0567 (Passcode: 3395375), or if outside North America, by dialing (236) 714-2186 (Passcode: 3395375). Individuals may access the live teleconference from this webcast link:

https://event.on24.com/wcc/r/2399486/795C3DADBA1B185511D571A263A6CCAE

An audio replay of the conference call and webcast will be available two hours after its completion and will be accessible for 30 days. To hear the replay, interested parties may go to the investor relations section of the ServiceNow website or dial (800) 585-8367 (Passcode: 3395375), or if outside North America, by dialing (416) 621-4642 (Passcode: 3395375).

Investor Presentation Details

An investor presentation providing additional information and analysis can be found at http://investors.servicenow.com.

Statement Regarding Use of Non-GAAP Financial Measures

We report the following non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Adjusted revenues. We present revenues adjusted for constant currency to provide a framework for assessing how our business performed excluding the effect of foreign currency rate fluctuations. To present this information, current period results for entities reporting in currencies other than U.S. Dollars (USD) are converted into USD at the average exchange rates in effect during the comparison period (for Q2 2019, the average exchange rates in effect for our major currencies were 1 USD to 0.8899 Euros and 1 USD to 0.7781 British Pound Sterling (GBP)), rather than the actual average exchange rates in effect during the current period (for Q2 2020, the average exchange rates in effect for our major currencies were 1 USD to 0.9083 Euros and 1 USD to 0.8059 GBP). Similarly, in our guidance, we apply the average exchange rates in effect during the comparison period rather than the exchange rates for the guidance period. We believe the presentation of revenues adjusted for constant currency facilitates the comparison of revenues year-over-year. Billings and Adjusted billings. We believe billings is a useful leading indicator regarding the performance of our business. We define subscription billings, professional services and other billings, and total billings as the applicable revenue plus the applicable change in deferred revenue, unbilled receivables and customer deposits as presented or derived from the statement of cash flows. We adjust billings for constant currency, as described above, and for constant duration by replacing the portion of multi-year billings in excess of twelve months during the current or guidance period with the portion of multi-year billings in excess of twelve months during the comparison period. We believe these adjustments facilitate greater comparability in our billings information year-over-year. Gross profit, Income from operations, Net income and Net income per share - diluted. Our non-GAAP presentation of gross profit, income from operations, and net income measures exclude certain non-cash or non-recurring items, including stock-based compensation expense, amortization of debt discount and issuance costs related to our convertible senior notes, loss on early note conversions, amortization of purchased intangibles, legal settlements, business combination and other related costs, and the related income tax effect of these adjustments. The non-GAAP weighted-average shares used to compute our non-GAAP net income per share - diluted excludes the dilutive effect of the in-the-money portion of convertible senior notes as they are covered by our note hedges, and includes the dilutive effect of time-based stock awards, the dilutive effect of warrants and the potentially dilutive effect of our stock awards with performance conditions not yet satisfied at forecasted attainment levels to the extent we believe it is probable that the performance condition will be met. We believe these adjustments provide useful supplemental information to investors and facilitates the analysis of our operating results and comparison of operating results across reporting periods. Free cash flow. Free cash flow is defined as net cash provided by (used in) operating activities plus cash paid for legal settlements and repayments of convertible senior notes attributable to debt discount, reduced by purchases of property and equipment. Free cash flow margin is calculated as free cash flow as a percentage of total revenues. We believe information regarding free cash flow and free cash flow margin provides useful information to investors because it is an indicator of the strength and performance of our business operations.

Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Please see the tables included at the end of this release for the reconciliation of GAAP and non-GAAP results and guidance.

Use of Forward-Looking Statements

This release contains "forward-looking statements" regarding our performance, including but not limited to statements in the section entitled "Financial Outlook." Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make.

Factors that may cause actual results to differ materially from those in any forward-looking statements include: (i) the impact and duration of the health impact of COVID-19 and the economic impact of safety measures to mitigate its impact, including the effectiveness, extent and duration of efforts to limit the spread and impact of the disease, such as "shelter in place" and similar government directives; (ii) our ability to compete successfully against existing and new competitors, (iii) our ability to comply with evolving privacy laws, data transfer restrictions, and other foreign and domestic standards related to data and the Internet, (iv) our ability to predict, prepare for and respond promptly to rapidly evolving technological, market and customer developments, (v) errors, interruptions, delays, or security breaches in or of our service or data centers, (vi) our ability to grow our business, including converting remaining performance obligations into revenue, adding and retaining customers, selling additional subscriptions to existing customers, selling to larger enterprises, government and regulated organizations with complex sales cycles and certification processes, and entering new geographies and markets, (vii) our ability to develop and gain customer acceptance of new and improved products and services, including those acquired through strategic transactions, and (viii) material changes in the value of foreign currencies relative to the U.S. Dollar. Additionally, these forward-looking statements, particularly our guidance, involve risk, uncertainties and assumptions, including those related to the continued impacts of COVID-19 on our business and global economic conditions. Many of these assumptions relate to matters that are beyond our control and changing rapidly, including, but not limited to, the timeframes for and severity of social distancing and other mitigation requirements, the continued impact of COVID-19 on our customers' purchasing decisions and the length of our sales cycles, particularly for customers in certain industries highly affected by COVID-19. Significant variation from the assumptions underlying our forward-looking statements could cause our actual results to vary, and the impact could be significant.

Further information on these and other factors that could affect our financial results are included in our Form 10-Q that will be filed for the quarter ended June 30, 2020 and in other filings we make with the Securities and Exchange Commission from time to time, including our Form 10-K filed for the year ended December 31, 2019.

We undertake no obligation, and do not intend, to update these forward-looking statements, to review or confirm analysts' expectations, or to provide interim reports or updates on the progress of the current financial quarter.

About ServiceNow

ServiceNow (NYSE: NOW) is making the world of work, work better for people. Our cloud-based platform and solutions deliver digital workflows that create great experiences and unlock productivity for employees and the enterprise. For more information, visit: www.servicenow.com.

(C) 2020 ServiceNow, Inc. All rights reserved. ServiceNow, the ServiceNow logo, Now, and other ServiceNow marks are trademarks and/or registered trademarks of ServiceNow, Inc. in the United States and/or other countries. Other company names, product names, and logos may be trademarks of the respective companies with which they are associated.

                                                                                                                                                        ServiceNow, Inc.
                                                                                                                                         Condensed Consolidated Statements of Operations
                                                                                                                                              (in thousands, except per share data)
                                                                                                                                                           (unaudited)
 
                                                                     Three Months Ended                                        Three Months Ended                                                                                 Six Months Ended
                                                                                       -------------------- ----------------------------------------------------------------------------------------                            ------------------------------------------------------------------------------------------
                                                                        June 30, 2020                 June 30, 2020                          June 30, 2019                          June 30, 2020                           June 30, 2019
                                                                                       -------------------- -----------------------------------                        ---------------------------------                        -----------------------------------                        -----------------------------------
Revenues:                                                                                                                                              
                                                                                       $                    $      1,015,528     $      780,989     $      2,010,230     $      1,520,975  
   Subscription
                                                                                                     55,314           55,314             52,915              106,952              101,855  
   Professional services and other
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                                  1,070,842        1,070,842            833,904            2,117,182            1,622,830  
      Total revenues
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
Cost of revenues (1):                                                                                                                                  
                                                                                                    171,934          171,934            135,479              331,655              262,068  
   Subscription
                                                                                                     61,005           61,005             62,668              124,650              122,331  
   Professional services and other
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                                    232,939          232,939            198,147              456,305              384,399  
      Total cost of revenues
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                                    837,903          837,903            635,757            1,660,877            1,238,431  
         Gross profit
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
Operating expenses (1):                                                                                                                                
                                                                                                    426,519          426,519            393,895              867,753              755,304  
   Sales and marketing
                                                                                                    245,081          245,081            183,420              471,738              355,942  
   Research and development
                                                                                                    104,037          104,037             85,442              209,785              169,898  
   General and administrative
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                                    775,637          775,637            662,757            1,549,276            1,281,144  
      Total operating expenses
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                                     62,266           62,266            (27,000 )                               111,601              (42,713 )
         Income (loss) from operations
Interest expense                                                                                     (8,488           (8,488 )                              (8,269 )                               (17,058 )                               (16,437 )
Interest income and other income, net                                                                 8,252            8,252             18,954               15,849               31,379  
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                                     62,030           62,030            (16,315 )                               110,392              (27,771 )
         Income (loss) before income taxes
Provision for (benefit from) income taxes                                                            21,264           21,264             (5,236 )                                21,395              (15,147 )
                                                                                       -------------------- ---------------  --------------------                      -------------  --------------------                      ---------------  --------------------                      ---------------  --------------------
                                                                                       $                    $         40,766     $      (11,079 )                      $         88,997     $        (12,624 )
         Net income (loss)
                                                                                       ==================== ====== ========= ====================                      ====== ======= ====================                      ====== ========= ====================                      ====== ========= ====================
Net income (loss) per share - basic                                                    $                    $           0.21     $        (0.06 )                      $           0.47     $          (0.07 )
                                                                                       ==================== ====== ========= ====================                      ====== ======= ====================                      ====== ========= ====================                      ====== ========= ====================
Net income (loss) per share - diluted                                                  $                    $           0.20     $        (0.06 )                      $           0.44     $          (0.07 )
                                                                                       ==================== ====== ========= ====================                      ====== ======= ====================                      ====== ========= ====================                      ====== ========= ====================
                                                                                                    191,319          191,319            186,678              190,731              184,419  
         Weighted-average shares used to compute net income (loss) per share - basic
                                                                                       ==================== ===============  ====================                      =============  ====================                      ===============  ====================                      ===============  ====================
                                                                                                    201,453          201,453            186,678              200,843              184,419  
         Weighted-average shares used to compute net income (loss) per share - diluted
                                                                                       ==================== ===============  ====================                      =============  ====================                      ===============  ====================                      ===============  ====================
                                                                                                                                                     
(1) Includes stock-based compensation as follows:
                                                                     Three Months Ended                                        Three Months Ended                                                                                 Six Months Ended
                                                                                       -------------------- ----------------------------------------------------------------------------------------                            ------------------------------------------------------------------------------------------
                                                                        June 30, 2020                 June 30, 2020                          June 30, 2019                          June 30, 2020                           June 30, 2019
                                                                                       -------------------- -----------------------------------                        ---------------------------------                        -----------------------------------                        -----------------------------------
Cost of revenues:                                                                                                                                      
                                                                                       $                    $         24,960     $       19,117     $         46,484     $         35,139  
   Subscription
                                                                                                     12,791           12,791             10,951               24,803               20,882  
   Professional services and other
Operating expenses:                                                                                                                                    
                                                                                                     78,967           78,967             69,229              149,127              131,359  
   Sales and marketing
                                                                                                     70,163           70,163             50,041              129,066               93,623  
   Research and development
                                                                                   ServiceNow, Inc.
                                                                         Condensed Consolidated Balance Sheets
                                                                                    (in thousands)
                                                                                      (unaudited)
 
                                                 June 30, 2020                 June 30, 2020                         December 31, 2019
                                                                -------------------- -----------------------------------                        -----------------------------------
Assets                                                                                  
Current assets:                                                                         
                                                                $                    $        837,309     $        775,778  
   Cash and cash equivalents
                                                                           1,505,362        1,505,362              915,317  
   Short-term investments
                                                                             631,992          631,992              835,279  
   Accounts receivable, net
                                                                             191,877          191,877              175,039  
   Current portion of deferred commissions
                                                                             170,582          170,582              125,488  
   Prepaid expenses and other current assets
                                                                -------------------- ---------------  --------------------                      ---------------  --------------------
                                                                           3,337,122        3,337,122            2,826,901  
      Total current assets
Deferred commissions, less current portion                                   355,684          355,684              333,448  
Long-term investments                                                        776,807          776,807            1,013,332  
Property and equipment, net                                                  547,253          547,253              468,085  
Operating lease right-of-use assets                                          463,220          463,220              402,428  
Intangible assets, net                                                       163,857          163,857              143,850  
Goodwill                                                                     211,416          211,416              156,756  
Deferred tax assets                                                          594,155          594,155              599,633  
Other assets                                                                  71,795           71,795               77,997  
                                                                -------------------- ---------------  --------------------                      ---------------  --------------------
                                                                $                    $      6,521,309     $      6,022,430  
      Total assets
                                                                ==================== ====== ========= ====================                      ====== ========= ====================
Liabilities and Stockholders' Equity                         
Current liabilities:                                                                    
                                                                $                    $         85,757     $         52,960  
   Accounts payable
                                                                             446,653          446,653              461,403  
   Accrued expenses and other current liabilities
                                                                           2,250,719        2,250,719            2,185,754  
   Current portion of deferred revenue
                                                                              65,742           65,742               52,668  
   Current portion of operating lease liabilities
                                                                -------------------- ---------------  --------------------                      ---------------  --------------------
                                                                           2,848,871        2,848,871            2,752,785  
      Total current liabilities
Deferred revenue, less current portion                                        31,399           31,399               40,038  
Operating lease liabilities, less current portion                            436,499          436,499              383,221  
Convertible senior notes, net                                                696,123          696,123              694,981  
Other long-term liabilities                                                   29,611           29,611               23,464  
Stockholders' equity                            2,478,806        2,478,806            2,127,941  
                                                                -------------------- ---------------  --------------------                      ---------------  --------------------
                                                                                                                                                         ServiceNow, Inc.
                                                                                                                                          Condensed Consolidated Statements of Cash Flows
                                                                                                                                                          (in thousands)
                                                                                                                                                            (unaudited)
 
                                                                          Three Months Ended                                        Three Months Ended                                                                               Six Months Ended
                                                                                            -------------------- ----------------------------------------------------------------------------------------                            --------------------------------------------------------------------------------------
                                                                             June 30, 2020                June 30, 2020                          June 30, 2019                         June 30, 2020                         June 30, 2019
                                                                                            -------------------- ----------------------------------                        ----------------------------------                        --------------------------------                        ----------------------------------
Cash flows from operating activities:                                                                                                                    
                                                                                            $                    $        40,766     $       (11,079 )                      $      88,997     $       (12,624 )
   Net income (loss)
                                                                                                                                                         
   Adjustments to reconcile net income (loss) to net cash provided by operating activities:
                                                                                                          82,390          82,390              60,328           158,628             115,777  
      Depreciation and amortization
                                                                                                          51,734          51,734              39,974           101,215              79,531  
      Amortization of deferred commissions
                                                                                                           8,488           8,488               8,269            17,058              16,437  
      Amortization of debt discount and issuance costs
                                                                                                         216,840         216,840             171,760           405,125             329,210  
      Stock-based compensation
                                                                                                          (1,650          (1,650 )                               (1,593 )                             (3,177 )                               (3,073 )
      Deferred income taxes
                                                                                                          (1,693          (1,693 )                       --            (1,975 )                       --  
      Repayments of convertible senior notes attributable to debt discount
                                                                                                          (2,007          (2,007 )                               (2,932 )                             (1,944 )                               (2,932 )
      Unrealized gains on non-marketable equity securities
                                                                                                            (906            (906 )                               (1,115 )                              1,302                (391 )
      Other
                                                                                                                                                         
      Changes in operating assets and liabilities, net of effect of business combinations:
                                                                                                          (8,774          (8,774 )                              (79,751 )                            200,015              71,354  
         Accounts receivable
                                                                                                         (73,184         (73,184 )                              (50,595 )                           (143,981 )                              (97,194 )
         Deferred commissions
                                                                                                         (12,038         (12,038 )                                5,176           (32,429 )                              (28,483 )
         Prepaid expenses and other assets
                                                                                                          16,645          16,645              18,531            37,324              25,093  
         Accounts payable
                                                                                                           9,401           9,401              38,820            69,248             100,190  
         Deferred revenue
                                                                                                          42,042          42,042              47,942           (35,784 )                               11,688  
         Accrued expenses and other liabilities
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
                                                                                                         368,054         368,054             243,735           859,622             604,583  
            Net cash provided by operating activities
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
Cash flows from investing activities:                                                                                                                    
                                                                                                        (110,464        (110,464 )                              (49,896 )                           (193,671 )                              (97,020 )
   Purchases of property and equipment
                                                                                                  --  --      --           (82,948 )                       --  
   Business combinations, net of cash acquired
                                                                                                          (6,500          (6,500 )                              (36,160 )                             (6,500 )                              (36,160 )
   Purchases of intangibles
                                                                                                        (579,919        (579,919 )                             (361,859 )                         (1,107,738 )                             (800,641 )
   Purchases of investments
                                                                                                         452,824         452,824             245,433           765,384             508,318  
   Sales and maturities of investments
                                                                                                             984             984                 (35 )                             (2,636 )                               22,113  
   Realized gains (losses) on derivatives not designated as hedging instruments, net
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
                                                                                                        (243,075        (243,075 )                             (202,517 )                           (628,109 )                             (403,390 )
            Net cash used in investing activities
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
Cash flows from financing activities:                                                                                                                    
                                                                                                         (13,502         (13,502 )                       --           (15,738 )                       --  
   Repayments of convertible senior notes attributable to principal
                                                                                                          24,148          24,148              10,207            91,056              63,300  
   Proceeds from employee stock plans
                                                                                                        (112,857        (112,857 )                             (108,126 )                           (238,557 )                             (247,619 )
   Taxes paid related to net share settlement of equity awards
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
                                                                                                        (102,211        (102,211 )                              (97,919 )                           (163,239 )                             (184,319 )
            Net cash used in financing activities
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
Foreign currency effect on cash, cash equivalents and restricted cash                                      5,787           5,787                 207            (4,862 )                                1,286  
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
                                                                                                          28,555          28,555             (56,494 )                             63,412              18,160  
            Net increase (decrease) in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period                                        812,848         812,848             643,192           777,991             568,538  
                                                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      --------------  --------------------
                                                                                                                                                                                          ServiceNow, Inc.
                                                                                                                                                                                   GAAP to Non-GAAP Reconciliation
                                                                                                                                                                                (in thousands, except per share data)
                                                                                                                                                                                             (unaudited)
 
                                                                                                              Three Months Ended                                                                                      Six Months Ended                                            
                                                                                          -----------------------------------------------------------------------------------------                                                                      -------------------------------------------------------------------------------------------
                                                                                    June 30, 2020                          June 30, 2019                  Growth Rates                    June 30, 2020                           June 30, 2019                   Growth Rates
                                                                                          -----------------------------------                        ----------------------------------                                                                  -----------------------------------                        ------------------------------------
Subscription revenues:                                                                                                                                                             
                                                                                          $      1,015,528     $       780,989              30%           $      2,010,230     $       1,520,975              32%
   GAAP subscription revenues
                                                                                                    11,531                                       23,106                            
      Effects of foreign currency rate fluctuations
                                                                                          ---------------  --------------------                                                                                                                          ---------------  --------------------
                                                                                          $      1,027,059                                  32%           $      2,033,336                                    34%
   Non-GAAP adjusted subscription revenues(1)
                                                                                          ====== ========= ====================                                                                                                                          ====== ========= ====================
                                                                                                                                                                                   
       
Subscription billings:                                                                                                                                                             
                                                                                          $      1,015,528     $       780,989              30%           $      2,010,230     $       1,520,975              32%
   GAAP subscription revenues
                                                                                                     2,704              35,915                   63,061               105,526      
      Change in subscription deferred revenue, unbilled receivables and customer deposits
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                 1,018,232             816,904              25%                  2,073,291             1,626,501              27%
   Non-GAAP subscription billings
                                                                                                    12,121                                       23,904                            
      Effects of foreign currency rate fluctuations
                                                                                                     2,774                                          899                            
      Effects of fluctuations in billings duration
                                                                                          ---------------  --------------------                                                                                                                          ---------------  --------------------
                                                                                          $      1,033,127                                  26%           $      2,098,094                                    29%
   Non-GAAP adjusted subscription billings(2)
                                                                                          ====== ========= ====================                                                                                                                          ====== ========= ====================
                                                                                                                                                                                   
       
Professional services and other revenues:                                                                                                                                          
                                                                                          $         55,314     $        52,915              5%            $        106,952     $         101,855              5%
   GAAP professional services and other revenues
                                                                                                       720                                        1,639                            
      Effects of foreign currency rate fluctuations
                                                                                          ---------------  --------------------                                                                                                                          ---------------  --------------------
                                                                                          $         56,034                                  6%            $        108,591                                    7%
   Non-GAAP adjusted professional service and other revenues(1)
                                                                                          ====== ========= ====================                                                                                                                          ====== ========= ====================
                                                                                                                                                                                   
       
Professional services and other billings:                                                                                                                                          
                                                                                          $         55,314     $        52,915              5%            $        106,952     $         101,855              5%
   GAAP professional services and other revenues
                                                                                                     5,670               1,196                    2,163                   190      
      Change in professional services and other deferred revenue
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                    60,984              54,111              13%                    109,115               102,045              7%
   Non-GAAP professional services and other billings
                                                                                                       720                                        1,639                            
      Effects of foreign currency rate fluctuations
                                                                                          ---------------  --------------------                                                                                                                          ---------------  --------------------
                                                                                          $         61,704                                  14%           $        110,754                                    9%
   Non-GAAP adjusted professional services and other billings(2)
                                                                                          ====== ========= ====================                                                                                                                          ====== ========= ====================
                                                                                                                                                                
Total revenues:                                                                                                                                                                    
                                                                                          $      1,070,842     $       833,904              28%           $      2,117,182     $       1,622,830              30%
   GAAP total revenues
                                                                                                    12,251                                       24,745                            
      Effects of foreign currency rate fluctuations
                                                                                          ---------------  --------------------                                                                                                                          ---------------  --------------------
                                                                                          $      1,083,093                                  30%           $      2,141,927                                    32%
   Non-GAAP adjusted total revenues(1)
                                                                                          ====== ========= ====================                                                                                                                          ====== ========= ====================
                                                                                                                                                                                   
    
Total billings:                                                                                                                                                                    
                                                                                          $      1,070,842     $       833,904              28%           $      2,117,182     $       1,622,830              30%
   GAAP total revenues
                                                                                                     8,374              37,111                   65,224               105,716      
      Change in total deferred revenue, unbilled receivables and customer deposits
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                 1,079,216             871,015              24%                  2,182,406             1,728,546              26%
   Non-GAAP total billings
                                                                                                    12,841                                       25,543                            
      Effects of foreign currency rate fluctuations
                                                                                                     2,774                                          899                            
      Effects of fluctuations in billings duration
                                                                                          ---------------  --------------------                                                                                                                          ---------------  --------------------
                                                                                          $      1,094,831                                  26%           $      2,208,848                                    28%
   Non-GAAP adjusted total billings(2)
                                                                                          ====== ========= ====================                                                                                                                          ====== ========= ====================
                                                                                                                                                                                   
    
Cost of revenues:                                                                                                                                                                  
                                                                                          $        171,934     $       135,479         $        331,655     $         262,068      
   GAAP subscription cost of revenues
                                                                                                   (24,960 )                              (19,117 )                                   (46,484 )                                (35,139 )                       
      Stock-based compensation
                                                                                                   (11,998 )                               (5,614 )                                   (18,854 )                                (10,314 )                       
      Amortization of purchased intangibles
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $        134,976     $       110,748         $        266,317     $         216,615      
   Non-GAAP subscription cost of revenues
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                                   
    
                                                                                          $         61,005     $        62,668         $        124,650     $         122,331      
   GAAP professional services and other cost of revenues
                                                                                                   (12,791 )                              (10,951 )                                   (24,803 )                                (20,882 )                       
      Stock-based compensation
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $         48,214     $        51,717         $         99,847     $         101,449      
   Non-GAAP professional services and other cost of revenues
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                                   
    
Gross profit (loss):                                                                                                                                                               
                                                                                          $        843,594     $       645,510         $      1,678,575     $       1,258,907      
   GAAP subscription gross profit
                                                                                                    24,960              19,117                   46,484                35,139      
      Stock-based compensation
                                                                                                    11,998               5,614                   18,854                10,314      
      Amortization of purchased intangibles
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $        880,552     $       670,241         $      1,743,913     $       1,304,360      
   Non-GAAP subscription gross profit
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                                   
    
                                                                                          $         (5,691 )                      $        (9,753 )                          $        (17,698 )                      $         (20,476 )                       
   GAAP professional services and other gross loss
                                                                                                    12,791              10,951                   24,803                20,882      
      Stock-based compensation
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $          7,100     $         1,198         $          7,105     $             406      
   Non-GAAP professional services and other gross profit
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                                   
    
                                                                                          $        837,903     $       635,757         $      1,660,877     $       1,238,431      
   GAAP gross profit
                                                                                                    37,751              30,068                   71,287                56,021      
      Stock-based compensation
                                                                                                    11,998               5,614                   18,854                10,314      
      Amortization of purchased intangibles
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $        887,652     $       671,439         $      1,751,018     $       1,304,766      
   Non-GAAP gross profit
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                
Gross margin:                                                                                                                                                                      
                                                                                                        83 %                                   83 %                                        84 %                                     83 %                       
   GAAP subscription gross margin
                                                                                                         2 %                                    2 %                                         2 %                                      2 %                       
      Stock-based compensation as % of subscription revenues
                                                                                                         2 %                                    1 %                                         1 %                                      1 %                       
      Amortization of purchased intangibles as % of subscription revenues
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                        87 %                                   86 %                                        87 %                                     86 %                       
   Non-GAAP subscription gross margin
                                                                                          ===============  ====================                      ==============  ====================                                                                ===============  ====================                      ================  ====================
                                                                                                                                                                                   
       
                                                                                                       (10 %)                                 (18 %)                                      (17 %)                                   (20 %)                      
   GAAP professional services and other gross margin
                                                                                                        23 %                                   20 %                                        24 %                                     20 %                       
      Stock-based compensation as % of professional services and other revenues
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                        13 %                                    2 %                                         7 %                                      0 %                       
   Non-GAAP professional services and other gross margin
                                                                                          ===============  ====================                      ==============  ====================                                                                ===============  ====================                      ================  ====================
                                                                                                                                                                                   
       
                                                                                                        78 %                                   76 %                                        78 %                                     76 %                       
   GAAP gross margin
                                                                                                         4 %                                    4 %                                         4 %                                      3 %                       
      Stock-based compensation as % of total revenues
                                                                                                         1 %                                    1 %                                         1 %                                      1 %                       
      Amortization of purchased intangibles as % of total revenues
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                        83 %                                   81 %                                        83 %                                     80 %                       
   Non-GAAP gross margin
                                                                                          ===============  ====================                      ==============  ====================                                                                ===============  ====================                      ================  ====================
                                                                                                                                                                                   
       
Operating expenses:                                                                                                                                                                
                                                                                          $        426,519     $       393,895         $        867,753     $         755,304      
   GAAP sales and marketing expenses
                                                                                                   (78,967 )                              (69,229 )                                  (149,127 )                               (131,359 )                       
      Stock-based compensation
                                                                                                      (311 )                       --                     (622 )                         --      
      Amortization of purchased intangibles
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $        347,241     $       324,666         $        718,004     $         623,945      
   Non-GAAP sales and marketing expenses
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                                   
       
                                                                                          $        245,081     $       183,420         $        471,738     $         355,942      
   GAAP research and development expenses
                                                                                                   (70,163 )                              (50,041 )                                  (129,066 )                                (93,623 )                       
      Stock-based compensation
                                                                                                      (455 )                                 (455 )                                      (910 )                                   (910 )                       
      Amortization of purchased intangibles
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                          $        174,463     $       132,924         $        341,762     $         261,409      
   Non-GAAP research and development expenses
                                                                                          ====== ========= ====================                      ======= ======= ====================                                                                ====== ========= ====================                      ======= ========= ====================
                                                                                                                                                                                   
       
                                                                                          $        104,037     $        85,442         $        209,785     $         169,898      
   GAAP general and administrative expenses
                                                                                                   (29,959 )                              (22,422 )                                   (55,645 )                                (48,207 )                       
      Stock-based compensation
                                                                                                    (1,939 )                               (1,950 )                                    (4,632 )                                 (3,837 )                       
      Amortization of purchased intangibles
                                                                                                    (1,186 )                                 (173 )                                    (4,061 )                                   (146 )                       
      Business combination and other related costs
                                                                                          ---------------  --------------------                      --------------  --------------------                                                                ---------------  --------------------                      ----------------  --------------------
                                                                                                                                                                                             
       
                                                                                                  $         775,637     $       662,757         $       1,549,276     $       1,281,144      
   GAAP total operating expenses
                                                                                                           (179,089 )                             (141,692 )                                   (333,838 )                               (273,189 )                       
      Stock-based compensation
                                                                                                             (2,705 )                               (2,405 )                                     (6,164 )                                 (4,747 )                       
      Amortization of purchased intangibles
                                                                                                             (1,186 )                                 (173 )                                     (4,061 )                                   (146 )                       
      Business combination and other related costs
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
                                                                                                  $         592,657     $       518,487         $       1,205,213     $       1,003,062      
   Non-GAAP total operating expenses
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                                                                                          
Income (loss) from operations:                                                                                                                                                               
                                                                                                  $          62,266     $       (27,000 )                          $         111,601     $         (42,713 )                       
   GAAP income (loss) from operations
                                                                                                            216,840             171,760                   405,125               329,210      
      Stock-based compensation
                                                                                                             14,703               8,019                    25,018                15,061      
      Amortization of purchased intangibles
                                                                                                              1,186                 173                     4,061                   146      
      Business combination and other related costs
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
                                                                                                  $         294,995     $       152,952         $         545,805     $         301,704      
   Non-GAAP income from operations
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                                                                                                             
       
Operating margin:                                                                                                                                                                            
                                                                                                                  6 %                                   (3 %)                                         5 %                                     (3 %)                      
   GAAP operating margin
                                                                                                                 20 %                                   21 %                                         19 %                                     20 %                       
      Stock-based compensation as % of total revenues
                                                                                                                  2 %                                    0 %                                          2 %                                      2 %                       
      Amortization of purchased intangibles as % of total revenues
                                                                                                                  0 %                                    0 %                                          0 %                                      0 %                       
      Business combination and other related costs as % of total revenues
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
                                                                                                                 28 %                                   18 %                                         26 %                                     19 %                       
   Non-GAAP operating margin
                                                                                                  ================  ====================                      ==============  ====================                                                                ================  ====================                      ================  ====================
                                                                                                                                                                                             
       
Net income (loss):                                                                                                                                                                           
                                                                                                  $          40,766     $       (11,079 )                          $          88,997     $         (12,624 )                       
   GAAP net income (loss)
                                                                                                            216,840             171,760                   405,125               329,210      
      Stock-based compensation
                                                                                                             14,703               8,019                    25,018                15,061      
      Amortization of purchased intangibles
                                                                                                              1,186                 173                     4,061                   146      
      Business combination and other related costs
                                                                                                              8,488               8,269                    17,058                16,437      
      Amortization of debt discount and issuance costs for the convertible senior notes
                                                                                                                817      --                       907        --      
      Loss on early note conversions
                                                                                                            (39,549 )                              (39,617 )                                    (91,117 )                                (81,763 )                       
      Income tax expense effects related to the above adjustments
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
                                                                                                  $         243,251     $       137,525         $         450,049     $         266,467      
   Non-GAAP net income
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                                                                                                             
       
Net income (loss) per share - basic and diluted:                                                                                                                                             
                                                                                                  $            0.21     $         (0.06 )                          $            0.47     $           (0.07 )                       
   GAAP net income (loss) per share - basic
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                  $            0.20     $         (0.06 )                          $            0.44     $           (0.07 )                       
   GAAP net income (loss) per share - diluted
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                  $            1.27     $          0.74         $            2.36     $            1.44      
   Non-GAAP net income per share - basic
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                  $            1.23     $          0.71         $            2.28     $            1.38      
   Non-GAAP net income per share - diluted
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                                                                                                             
    
                                                                                                            191,319             186,678                   190,731               184,419      
   GAAP weighted-average shares used to compute net income (loss) per share - basic
                                                                                                  ================  ====================                      ==============  ====================                                                                ================  ====================                      ================  ====================
                                                                                                                                                                                             
    
                                                                                                            201,453             186,678                   200,843               184,419      
   GAAP weighted-average shares used to compute net income (loss) per share - diluted
                                                                                                     --               6,100            --                 6,199      
      Effects of dilutive time-based stock awards(3)
                                                                                                             (3,510 )                       --                    (3,414 )                         --      
      Effects of in-the-money portion of convertible senior notes(3)
                                                                                                     --               1,584            --                 2,617      
      Effects of warrants(3)
                                                                                                                 19                 100                         1                    43      
      Effects of stock awards with performance conditions not yet satisfied(3)
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
                                                                                                            197,962             194,462                   197,430               193,278      
   Non-GAAP weighted-average shares used to compute net income per share - diluted
                                                                                                  ================  ====================                      ==============  ====================                                                                ================  ====================                      ================  ====================
                                                                                                                                                                          
Free cash flow:                                                                                                                                                                              
                                                                                                  $         368,054     $       243,735         $         859,622     $         604,583      
   GAAP net cash provided by operating activities
                                                                                                           (110,464 )                              (49,896 )                                   (193,671 )                                (97,020 )                       
      Purchases of property and equipment
                                                                                                              1,693      --                     1,975        --      
      Repayments of convertible senior notes attributable to debt discount
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
                                                                                                  $         259,283     $       193,839         $         667,926     $         507,563      
   Non-GAAP free cash flow
                                                                                                  ======= ========= ====================                      ======= ======= ====================                                                                ======= ========= ====================                      ======= ========= ====================
                                                                                                                                                                                             
    
Free cash flow margin:                                                                                                                                                                       
                                                                                                                 34 %                                   29 %                                         41 %                                     37 %                       
   GAAP net cash provided by operating activities as % of total revenues
                                                                                                                (10 %)                                  (6 %)                                        (9 %)                                    (6 %)                      
      Purchases of property and equipment as % of total revenues
                                                                                                                  0 %                       -- %                                          0 %                         -- %                       
      Repayments of convertible senior notes attributable to debt discount as % of total revenues
                                                                                                  ----------------  --------------------                      --------------  --------------------                                                                ----------------  --------------------                      ----------------  --------------------
(1)
       Adjusted revenues and the corresponding growth rates are derived by applying the average exchange rates in effect during the comparison period rather than the actual average exchange rates in effect during the current period.
(2)
       Adjusted billings and the corresponding growth rates are derived by applying the average exchange rates in effect during the comparison period rather than the actual average exchange rates in effect during the current period, and by replacing the portion of multi-year billings in excess of twelve months during the current period with the portion of multi-year billings in excess of twelve months during the comparison period.

ServiceNow, Inc. Reconciliation of Non-GAAP Financial Guidance

The financial guidance provided below is an estimate based on information available as of June 30, 2020. The company's future performance and financial results are subject to risks and uncertainties, and actual results could differ materially from the guidance set forth below. Some of the factors that could affect the company's financial results are stated above in this press release. Further information on these and other factors that could affect our financial results are included in our Form 10-K for the year ended December 31, 2019 and in other filings we make with the Securities and Exchange Commission from time to time, including our Form 10-Q that will be filed for the three months ended June 30, 2020. The company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates.

                                                                               Three Months Ended                           Three Months Ended                            
                                                                                               ----------------------- ----------------------------------------------------------------
                                                                               September 30, 2020      September 30, 2020      September 30, 2019(3)      Growth Rates
                                                                                               ----------------------- -----------------------                      ---------------------
                                                                                              
GAAP subscription revenues                                                                      $1,055 - $1,060 million $1,055 - $1,060 million       $835 million             26% - 27%
                                                                                              
                                                                                                         NM(5)                   NM(5)                 
   Effects of foreign currency rate fluctuations
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP adjusted subscription revenues(1)                                                      $1,055 - $1,060 million $1,055 - $1,060 million             26% - 27%
                                                                                               ======================= =======================
                                                                                              
GAAP subscription revenues                                                                      $1,055 - $1,060 million $1,055 - $1,060 million       $835 million             26% - 27%
                                                                                              
                                                                                                  (60) - (45) million     (60) - (45) million          $29 million        
   Change in subscription deferred revenue, unbilled receivables and customer deposits
                                                                                              
                                                                                               ----------------------- -----------------------                      ---------------------
Non-GAAP subscription billings                                                                   $995 - $1,015 million   $995 - $1,015 million        $864 million             15% - 17%
                                                                                              
                                                                                                         NM(5)                   NM(5)                 
   Effects of foreign currency rate fluctuations
                                                                                              
                                                                                                       8 million               8 million               
   Effects of fluctuations in billings duration
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP adjusted subscription billings(2)                                                      $1,003 - $1,023 million $1,003 - $1,023 million             16% - 18%
                                                                                               ======================= =======================
                                                                                              
GAAP operating margin                                                                                     1%                      1%                   
                                                                                              
                                                                                                          20%                     20%                  
   Stock-based compensation expense as % of total revenues
                                                                                              
                                                                                                          1%                      1%                   
   Amortization of purchased intangibles as % of total revenues
                                                                                              
                                                                                                          0%                      0%                   
   Business combination and other related costs as % of total revenues
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP operating margin                                                                                 22%                     22%                  
                                                                                               ======================= =======================
                                                                                              
GAAP weighted-average shares used to compute net income per share - diluted                           203 million             203 million              
                                                                                              
                                                                                                      (4) million             (4) million              
   Effects of in-the-money portion of convertible senior notes(4)
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP weighted-average shares used to compute net income per share - diluted                       199 million             199 million              
                                                                                               ======================= =======================
                                                                                              
                                                                                                                                    
                                                                               Twelve Months Ended                          Twelve Months Ended                           
                                                                                               ----------------------- ----------------------------------------------------------------
                                                                                December 31, 2020       December 31, 2020      December 31, 2019(3)       Growth Rates
                                                                                               ----------------------- -----------------------                      ---------------------
                                                                                              
GAAP subscription revenues                                                                      $4,185 - $4,200 million $4,185 - $4,200 million      $3,255 million               29%
                                                                                              
                                                                                                      25 million              25 million               
   Effects of foreign currency rate fluctuations
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP adjusted subscription revenues(1)                                                      $4,210 - $4,225 million $4,210 - $4,225 million             29% - 30%
                                                                                               ======================= =======================
                                                                                              
GAAP subscription revenues                                                                      $4,185 - $4,200 million $4,185 - $4,200 million      $3,255 million               29%
                                                                                              
                                                                                                   475 - 500 million       475 - 500 million           533 million        
   Change in subscription deferred revenue, unbilled receivables and customer deposits
                                                                                              
                                                                                               ----------------------- -----------------------                      ---------------------
Non-GAAP subscription billings                                                                  $4,660 - $4,700 million $4,660 - $4,700 million      $3,788 million            23% - 24%
                                                                                              
                                                                                                      28 million              28 million               
   Effects of foreign currency rate fluctuations
                                                                                              
                                                                                                      14 million              14 million               
   Effects of fluctuations in billings duration
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP adjusted subscription billings(2)                                                      $4,702 - $4,742 million $4,702 - $4,742 million             24% - 25%
                                                                                               ======================= =======================
                                                                                              
GAAP subscription gross margin                                                                            83%                     83%                  
                                                                                              
                                                                                                          2%                      2%                   
   Stock-based compensation expense as % of subscription revenues
                                                                                              
                                                                                                          1%                      1%                   
   Amortization of purchased intangibles as % of subscription revenues
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP subscription margin                                                                              86%                     86%                  
                                                                                               ======================= =======================
                                                                                              
GAAP operating margin                                                                                     4%                      4%                   
                                                                                              
                                                                                                          19%                     19%                  
   Stock-based compensation expense as % of total revenues
                                                                                              
                                                                                                          1%                      1%                   
   Amortization of purchased intangibles as % of total revenues
                                                                                              
                                                                                                          0%                      0%                   
   Business combination and other related costs as % of total revenues
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP operating margin                                                                                 24%                     24%                  
                                                                                               ======================= =======================
                                                                                              
GAAP net cash provided by operating activities as % of total revenues                                    37.5%                   37.5%                 
                                                                                              
                                                                                                         (8%)                    (8%)                  
   Purchases of property and equipment as % of total revenues
                                                                                              
                                                                                                          0%                      0%                   
   Repayments of convertible senior notes attributable to debt discount as % of total revenues
                                                                                              
                                                                                               ----------------------- -----------------------
Non-GAAP free cash flow margin                                                                           29.5%                   29.5%                 
                                                                                               ======================= =======================
                                                                                              
GAAP weighted-average shares used to compute net income per share - diluted                           201 million             201 million              
                                                                                              
                                                                                                      (3) million             (3) million              
   Effects of in-the-money portion of convertible senior notes(4)
                                                                                              
                                                                                               ----------------------- -----------------------
(1) Adjusted revenues and the corresponding growth rates are derived by applying the average exchange rates in effect during the comparison period rather than the exchange rates for the guidance period.
(2) Adjusted billings and the corresponding growth rates are derived by applying the average exchange rates in effect during the comparison period rather than the exchange rates for the guidance period, and by replacing the portion of multi-year billings in excess of twelve months for the guidance period with the actual portion of multi-year billings in excess of twelve months during the comparison period.
(3) Effects of foreign currency rate fluctuations and fluctuations in billing durations are not applicable for the comparison period.
(4) We exclude the in-the-money portion of convertible senior notes for non-GAAP weighted-average diluted shares as they are covered by our note hedges.

View source version on businesswire.com: https://www.businesswire.com/news/home/20200729005906/en/

SOURCE: ServiceNow, Inc.

Media Contact: 
Sara Day
650.336.3123
press@servicenow.com


Investor Contact: 
Darren Yip
925.388.7205
ir@servicenow.com
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