Stock Analysis on Net
Stock Analysis on Net

ServiceNow Inc. (NYSE:NOW)

Common-Size Balance Sheet: Liabilities and Stockholders’ Equity 

ServiceNow Inc., common-size consolidated balance sheet: liabilities and stockholders’ equity

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Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Accounts payable 0.33 0.72 2.06 0.82 0.39
Accrued payroll 3.43 3.74 3.68 4.11 4.27
Taxes payable 0.79 0.71 0.82 0.94 0.67
Other employee-related liabilities 0.96 0.96 1.13 1.12 1.05
Other 1.53 2.44 1.70 1.70 1.68
Accrued expenses and other current liabilities 6.72% 7.85% 7.33% 7.87% 7.67%
Current portion of deferred revenue 33.45 33.27 35.04 35.53 33.99
Current portion of operating lease liabilities 0.50 0.51 0.72 0.76 0.83
Current debt, net 0.00 0.00 0.00 0.85 0.00
Current liabilities 41.00% 42.36% 45.15% 45.83% 42.88%
Deferred revenue, less current portion 0.47 0.47 0.53 0.58 0.52
Operating lease liabilities, less current portion 3.37 4.07 4.89 5.15 4.85
Long-term debt, net, less current portion 7.31 8.56 11.17 13.74 18.82
Other long-term liabilities 0.71 0.68 0.42 0.47 0.40
Long-term liabilities 11.85% 13.77% 17.01% 19.95% 24.59%
Total liabilities 52.86% 56.13% 62.16% 65.78% 67.48%
Preferred stock, $0.001 par value; no shares issued or outstanding 0.00 0.00 0.00 0.00 0.00
Common stock, $0.001 par value 0.00 0.00 0.00 0.00 0.00
Treasury stock, at cost -5.98 -3.08 0.00 0.00 0.00
Additional paid-in capital 36.31 35.26 36.06 33.94 34.12
Accumulated other comprehensive income (loss) -0.33 -0.21 -0.77 0.31 1.08
Retained earnings (accumulated deficit) 17.14 11.90 2.54 -0.04 -2.68
Stockholders’ equity 47.14% 43.87% 37.84% 34.22% 32.52%
Total liabilities and stockholders’ equity 100.00% 100.00% 100.00% 100.00% 100.00%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Liabilities Trends
The proportion of total liabilities relative to total liabilities and stockholders' equity has shown a consistent decline over the reported periods. Beginning at 67.48% in 2020, this figure has decreased annually to reach 52.86% by 2024. This reduction is indicative of a decreasing reliance on liabilities for financing.
Within current liabilities, the percentage has decreased moderately from 42.88% in 2020 to 41% in 2024. Notably, "Accounts payable" experienced fluctuation, rising sharply in 2022 to 2.06%, but subsequently declining to 0.33% by 2024. "Accrued payroll" showed a slight gradual decline, starting at 4.27% and reducing to 3.43%. Other components within current liabilities such as "Taxes payable" and "Other employee-related liabilities" remained relatively stable with minor variations.
The "Current portion of deferred revenue" maintained a steady share around the mid-30% range, slightly decreasing from 33.99% in 2020 to 33.45% in 2024. "Accrued expenses and other current liabilities" decreased in percentage from 7.67% to 6.72%, highlighting a moderate reduction in these obligations.
In long-term liabilities, the trend is more pronounced with a decline from 24.59% to 11.85% over the same period. Key contributors to this decline include "Long-term debt, net, less current portion," which saw a substantial reduction from 18.82% to 7.31%, as well as "Operating lease liabilities, less current portion," which decreased from 4.85% to 3.37%.
Equity and Related Items
Stockholders' equity as a proportion of total liabilities and equity has increased consistently, rising from 32.52% in 2020 to 47.14% in 2024. This indicates strengthening equity funding relative to liabilities.
"Retained earnings (accumulated deficit)" shifted from a negative position in 2020 at -2.68%, near zero in 2021, and then grew steadily to reach 17.14% by 2024. This robust increase suggests overall accumulation of profits or retained earnings within the equity base.
The "Additional paid-in capital" component remained relatively stable, fluctuating slightly but holding around the mid-30% level throughout the periods.
"Accumulated other comprehensive income (loss)" was positive in 2020 but shifted to a small negative position during 2022 and remained slightly negative thereafter, indicating minor unrealized losses or other adjustments affecting comprehensive income.
"Treasury stock, at cost" appeared only from 2022 onwards, with an increasing negative balance from -3.08% to -5.98%, which reduces total stockholders’ equity.
Summary of Financial Structure Dynamics
Overall, there is a clear movement toward a stronger equity position relative to liabilities, supported by decreasing debt levels, especially in long-term obligations. The reduction in total liabilities as a proportion of the capital structure, together with rising retained earnings, suggests improved financial health and possibly lower financial risk.
The stability in deferred revenue components implies continuing operational performance characterized by recurring revenues. Meanwhile, minor variations in accrued payroll and other employee-related liabilities indicate consistent management of employee-related obligations.
The increasing level of treasury stock implies some share repurchase activity or reduction in outstanding shares, impacting equity metrics.