Back to top

Image: Bigstock

Countdown to ServiceNow (NOW) Q1 Earnings: A Look at Estimates Beyond Revenue and EPS

Read MoreHide Full Article

Wall Street analysts expect ServiceNow (NOW - Free Report) to post quarterly earnings of $3.15 per share in its upcoming report, which indicates a year-over-year increase of 32.9%. Revenues are expected to be $2.58 billion, up 23.2% from the year-ago quarter.

Over the last 30 days, there has been a downward revision of 2% in the consensus EPS estimate for the quarter, leading to its current level. This signifies the covering analysts' collective reconsideration of their initial forecasts over the course of this timeframe.

Ahead of a company's earnings disclosure, it is crucial to give due consideration to changes in earnings estimates. These revisions serve as a noteworthy factor in predicting potential investor reactions to the stock. Numerous empirical studies consistently demonstrate a strong relationship between trends in earnings estimate revision and the short-term price performance of a stock.

While investors typically use consensus earnings and revenue estimates as a yardstick to evaluate the company's quarterly performance, scrutinizing analysts' projections for some of the company's key metrics can offer a more comprehensive perspective.

Bearing this in mind, let's now explore the average estimates of specific ServiceNow metrics that are commonly monitored and projected by Wall Street analysts.

According to the collective judgment of analysts, 'Revenues- Professional services and other' should come in at $75.40 million. The estimate indicates a change of +4.7% from the prior-year quarter.

The combined assessment of analysts suggests that 'Revenues- Subscription' will likely reach $2.51 billion. The estimate indicates a change of +24.1% from the prior-year quarter.

It is projected by analysts that the 'Gross Profit (Non-GAAP)- Subscription' will reach $2.12 billion. The estimate compares to the year-ago value of $1.73 billion.

View all Key Company Metrics for ServiceNow here>>>

Over the past month, shares of ServiceNow have returned -5.4% versus the Zacks S&P 500 composite's -2.6% change. Currently, NOW carries a Zacks Rank #4 (Sell), suggesting that it may underperform the overall market in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


ServiceNow, Inc. (NOW) - free report >>

Published in