Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

ServiceNow Inc., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income	1,425)	1,731)	325)	230)	119)
Depreciation and amortization	564)	562)	433)	472)	336)
Amortization of deferred commissions	550)	459)	358)	294)	218)
Stock-based compensation	1,746)	1,604)	1,401)	1,131)	870)
Deferred income taxes	98)	(857)	15)	(34)	(24)
Other	(51)	—)	17)	40)	(13)
Accounts receivable	(254)	(300)	(340)	(401)	(151)
Deferred commissions	(713)	(717)	(566)	(565)	(365)
Prepaid expenses and other assets	(332)	(203)	(39)	(93)	(54)
Accounts payable	(52)	(142)	172)	55)	(34)
Deferred revenue	1,179)	1,085)	904)	960)	711)
Accrued expenses and other liabilities	107)	176)	43)	102)	175)
Changes in operating assets and liabilities, net of effect of business combinations	(65)	(101)	174)	58)	281)
Adjustments to reconcile net income to net cash provided by operating activities	2,842)	1,667)	2,398)	1,961)	1,668)
Net cash provided by operating activities	4,267)	3,398)	2,723)	2,191)	1,787)
Purchases of property and equipment	(852)	(694)	(550)	(392)	(419)
Business combinations, net of cash acquired	(113)	(279)	(91)	(785)	(107)
Purchases of other intangibles	(40)	(3)	—)	—)	—)
Purchases of investments	(5,031)	(4,634)	(4,038)	(2,485)	(2,922)
Purchases of non-marketable investments	(181)	(75)	(167)	(71)	(12)
Sales and maturities of investments	3,752)	3,522)	2,245)	2,119)	1,965)
Other	(36)	(4)	18)	7)	(12)
Net cash used in investing activities	(2,501)	(2,167)	(2,583)	(1,607)	(1,507)
Net proceeds from borrowings on 2030 Notes	—)	—)	—)	—)	1,482)
Repayments of convertible senior notes attributable to principal	—)	—)	(94)	(61)	(1,628)
Net proceeds from unwind of 2022 Note Hedge	—)	—)	—)	—)	1,106)
Proceeds from employee stock plans	237)	194)	177)	167)	146)
Repurchases of common stock	(696)	(538)	—)	—)	—)
Taxes paid related to net share settlement of equity awards	(700)	(459)	(427)	(612)	(509)
Business combination	(184)	—)	—)	—)	—)
Net cash provided by (used in) financing activities	(1,343)	(803)	(344)	(506)	597)
Foreign currency effect on cash, cash equivalents and restricted cash	(17)	1)	(53)	(25)	25)
Net change in cash, cash equivalents and restricted cash	406)	429)	(257)	53)	901)
Cash, cash equivalents and restricted cash at beginning of period	1,904)	1,475)	1,732)	1,679)	778)
Cash, cash equivalents and restricted cash at end of period	2,310)	1,904)	1,475)	1,732)	1,679)

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).

Net Income: The net income showed a consistent increase from 119 million in 2020 to a peak of 1731 million in 2023, followed by a decline to 1425 million in 2024. This indicates strong profitability growth until 2023, with a noticeable reduction in the most recent year.
Depreciation and Amortization: Depreciation and amortization expenses gradually increased from 336 million in 2020 to 564 million in 2024, reflecting growing capital asset utilization or acquisitions.
Amortization of Deferred Commissions: This expense consistently rose from 218 million in 2020 to 550 million in 2024, suggesting increased investments in deferred commissions, aligning with growth strategies focusing on customer acquisition or retention.
Stock-Based Compensation: A steady upward trend from 870 million in 2020 to 1746 million in 2024 indicates growing reliance on equity incentives, which may affect operating expenses and shareholder dilution.
Deferred Income Taxes: Values fluctuated considerably, starting negative in 2020 (-24 million), moving positive in 2022 (15 million), sharply negative again in 2023 (-857 million), then positive in 2024 (98 million). These swings suggest variable tax timing differences or changes in tax asset/liability recognition.
Other Operating Assets and Liabilities: Accounts receivable, deferred commissions, prepaid expenses, and accounts payable showed mixed movements. Notably, accounts receivable saw decreasing negative values indicating reduced cash outflow from customers. Deferred revenue increased steadily from 711 million to 1179 million, possibly indicating increased customer deposits or prepaid services.
Operating Cash Flow: Net cash provided by operating activities grew consistently from 1787 million in 2020 to 4267 million in 2024, demonstrating strong operational cash generation alongside increasing net income. Adjustments to reconcile net income to net cash provided by operations also rose, reflecting non-cash expenses.
Investing Activities: Significant investments were made in property and equipment, business combinations, intangible assets, and particularly in investments, with purchases generally exceeding sales. Net cash used in investing activities increased from 1507 million in 2020 to around 2500 million in 2024, indicating aggressive capital deployment despite improved operating cash flows.
Financing Activities: Financing cash flows varied, with positive inflows in 2020 but consistent outflows in later years, especially in 2023 and 2024. Stock repurchases occurred in 2023 and 2024, totaling 538 million and 696 million respectively, alongside higher taxes related to equity awards and business combination-related payments, contributing to net outflows in financing activities.
Cash Position: Despite fluctuations in investing and financing activities, cash and cash equivalents increased overall from 1679 million at the end of 2020 to 2310 million at the end of 2024, supported by strong operational cash flow generation, indicating a healthy liquidity position.

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ServiceNow Inc. (NYSE:NOW)

Cash Flow Statement