Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

ServiceNow Inc., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Subscription	10,646)	8,680)	6,891)	5,573)	4,286)
Professional services and other	338)	291)	354)	323)	234)
Revenues	10,984)	8,971)	7,245)	5,896)	4,519)
Subscription	(1,942)	(1,606)	(1,187)	(1,022)	(731)
Professional services and other	(345)	(315)	(386)	(331)	(256)
Cost of revenues	(2,287)	(1,921)	(1,573)	(1,353)	(987)
Gross profit	8,697)	7,050)	5,672)	4,543)	3,532)
Sales and marketing	(3,854)	(3,301)	(2,814)	(2,292)	(1,855)
Research and development	(2,543)	(2,124)	(1,768)	(1,397)	(1,024)
General and administrative	(936)	(863)	(735)	(597)	(454)
Operating expenses	(7,333)	(6,288)	(5,317)	(4,286)	(3,334)
Income from operations	1,364)	762)	355)	257)	199)
Interest income	419)	302)	82)	20)	39)
Interest expense	(23)	(24)	(27)	(28)	(33)
Other	(22)	(32)	(11)	—)	(56)
Other expense, net	(45)	(56)	(38)	(28)	(89)
Income before income taxes	1,738)	1,008)	399)	249)	149)
(Provision for) benefit from income taxes	(313)	723)	(74)	(19)	(31)
Net income	1,425)	1,731)	325)	230)	119)

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).

Revenue and Subscription Trends: The total revenues have shown a consistent upward trend from 2020 through 2024, increasing from $4,519 million in 2020 to $10,984 million in 2024, indicating strong growth in the company’s business. Subscription revenues, which form the majority of total revenues, have increased significantly each year, nearly doubling over the period, from $4,286 million in 2020 to $10,646 million in 2024. This highlights the growing importance and success of the core subscription service model.; The professional services and other revenues have shown some variability but overall modest growth, with a slight decrease in 2023 before recovering in 2024. This suggests that while this segment remains a smaller part of total revenues, it has not experienced the same robust growth as subscription revenues.
Cost of Revenues and Gross Profit: Cost of revenues has steadily increased from $987 million in 2020 to $2,287 million in 2024, reflecting the scaling of operations in line with revenue growth. Despite the rising costs, gross profit has increased markedly, from $3,532 million in 2020 to $8,697 million in 2024, demonstrating improved profitability and efficient cost management relative to revenue increases.
Operating Expenses: Operating expenses have risen each year, from $3,334 million in 2020 to $7,333 million in 2024, driven by increases across sales and marketing, research and development, and general and administrative costs. Sales and marketing expenses are the largest component and have grown substantially, reflecting ongoing investments in customer acquisition and brand development. Research and development expenditures have also increased significantly, indicating continued emphasis on product innovation and enhancement. General and administrative expenses have grown more moderately but consistently.
Operating Income: Income from operations has improved steadily over the five-year period, more than doubling from $199 million in 2020 to $1,364 million in 2024. This signifies effective operational leverage and the company’s ability to scale profitably as revenues grow.
Interest and Other Income/Expenses: Interest income has notably increased over the years, from $39 million in 2020 to $419 million in 2024, which has positively contributed to overall earnings. Interest expense has decreased slightly, reflecting reduced cost of debt or improved financing conditions. Other expenses have fluctuated but remain relatively minor compared to primary operation components, with a slight reduction from -$89 million in 2020 to -$45 million in 2024.
Income Before Taxes and Net Income: Income before income taxes has risen markedly from $149 million in 2020 to $1,738 million in 2024, mirroring improvements in operational and non-operational income components. The provision for income taxes shows volatility, including a notable tax benefit reported in 2023, which significantly increased net income that year. Net income increased substantially over the period, from $119 million in 2020 to $1,425 million in 2024, with a peak of $1,731 million in 2023, reflective of both operational success and tax-related factors.
Summary: Overall, the financial data demonstrates strong revenue growth primarily driven by the subscription segment, effective cost management resulting in expanding gross profit and operating income, and increasing investment in growth initiatives such as sales and marketing and research and development. The company’s profitability has improved significantly, supported by growing operational efficiency and increased interest income. Volatility in income taxes has impacted net income figures, yet the overall trend in earnings is positive, highlighting sustainable financial performance and expansion.

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ServiceNow Inc. (NYSE:NOW)

Income Statement