Stock Analysis on Net

ServiceNow Inc. (NYSE:NOW)

Analysis of Profitability Ratios

Microsoft Excel

Profitability Ratios (Summary)

ServiceNow Inc., profitability ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Return on Sales
Gross profit margin 78.59% 78.29% 77.05% 78.16% 76.98%
Operating profit margin 8.49% 4.90% 4.36% 4.40% 1.22%
Net profit margin 19.30% 4.49% 3.90% 2.62% 18.11%
Return on Investment
Return on equity (ROE) 22.69% 6.46% 6.22% 4.18% 29.45%
Return on assets (ROA) 9.96% 2.44% 2.13% 1.36% 10.41%

Based on: 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), 10-K (reporting date: 2019-12-31).

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. ServiceNow Inc. gross profit margin ratio improved from 2021 to 2022 and from 2022 to 2023.
Operating profit margin A profitability ratio calculated as operating income divided by revenue. ServiceNow Inc. operating profit margin ratio improved from 2021 to 2022 and from 2022 to 2023.
Net profit margin An indicator of profitability, calculated as net income divided by revenue. ServiceNow Inc. net profit margin ratio improved from 2021 to 2022 and from 2022 to 2023.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity. ServiceNow Inc. ROE improved from 2021 to 2022 and from 2022 to 2023.
ROA A profitability ratio calculated as net income divided by total assets. ServiceNow Inc. ROA improved from 2021 to 2022 and from 2022 to 2023.

Gross Profit Margin

ServiceNow Inc., gross profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Gross profit 7,050 5,672 4,543 3,532 2,664
Revenues 8,971 7,245 5,896 4,519 3,460
Profitability Ratio
Gross profit margin1 78.59% 78.29% 77.05% 78.16% 76.98%
Benchmarks
Gross Profit Margin, Competitors2
Accenture PLC 32.34% 31.99% 32.38% 31.53% 30.81%
Adobe Inc. 87.87% 87.70% 88.18% 86.62% 85.03%
International Business Machines Corp. 55.45% 54.00% 54.90% 48.32% 47.30%
Intuit Inc. 78.13% 81.09% 82.53% 82.05% 82.80%
Microsoft Corp. 68.92% 68.40% 68.93% 67.78% 65.90%
Oracle Corp. 72.85% 79.08% 80.59% 79.68% 79.76%
Palo Alto Networks Inc. 72.29% 68.76% 70.05% 70.68% 72.12%
Salesforce Inc. 73.34% 73.48% 74.41% 75.23% 74.02%
Synopsys Inc. 79.08% 79.07% 79.50% 78.44% 77.60%

Based on: 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), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues
= 100 × 7,050 ÷ 8,971 = 78.59%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. ServiceNow Inc. gross profit margin ratio improved from 2021 to 2022 and from 2022 to 2023.

Operating Profit Margin

ServiceNow Inc., operating profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Income from operations 762 355 257 199 42
Revenues 8,971 7,245 5,896 4,519 3,460
Profitability Ratio
Operating profit margin1 8.49% 4.90% 4.36% 4.40% 1.22%
Benchmarks
Operating Profit Margin, Competitors2
Accenture PLC 13.74% 15.21% 15.08% 14.69% 14.59%
Adobe Inc. 34.26% 34.64% 36.76% 32.93% 29.25%
International Business Machines Corp. 15.17% 13.50% 11.97% 9.22% 13.67%
Intuit Inc. 21.86% 20.20% 25.95% 28.34% 27.33%
Microsoft Corp. 41.77% 42.06% 41.59% 37.03% 34.14%
Oracle Corp. 26.21% 25.74% 37.58% 35.57% 34.26%
Palo Alto Networks Inc. 5.62% -3.43% -7.15% -5.25% -1.87%
Salesforce Inc. 3.29% 2.07% 2.14% 1.74% 4.03%
Synopsys Inc. 21.72% 22.87% 17.48% 16.83% 15.48%
Operating Profit Margin, Sector
Software & Services 28.03% 27.98% 28.89% 25.05% 24.34%
Operating Profit Margin, Industry
Information Technology 26.32% 28.40% 28.74% 24.91% 25.31%

Based on: 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), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Operating profit margin = 100 × Income from operations ÷ Revenues
= 100 × 762 ÷ 8,971 = 8.49%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Operating profit margin A profitability ratio calculated as operating income divided by revenue. ServiceNow Inc. operating profit margin ratio improved from 2021 to 2022 and from 2022 to 2023.

Net Profit Margin

ServiceNow Inc., net profit margin calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Net income 1,731 325 230 119 627
Revenues 8,971 7,245 5,896 4,519 3,460
Profitability Ratio
Net profit margin1 19.30% 4.49% 3.90% 2.62% 18.11%
Benchmarks
Net Profit Margin, Competitors2
Accenture PLC 10.72% 11.17% 11.69% 11.52% 11.06%
Adobe Inc. 27.97% 27.01% 30.55% 40.88% 26.42%
International Business Machines Corp. 12.13% 2.71% 10.01% 7.59% 12.22%
Intuit Inc. 16.59% 16.23% 21.41% 23.78% 22.95%
Microsoft Corp. 34.15% 36.69% 36.45% 30.96% 31.18%
Oracle Corp. 17.02% 15.83% 33.96% 25.94% 28.05%
Palo Alto Networks Inc. 6.38% -4.85% -11.72% -7.83% -2.82%
Salesforce Inc. 0.66% 5.45% 19.16% 0.74% 8.36%
Synopsys Inc. 21.05% 19.38% 18.02% 18.03% 15.84%
Net Profit Margin, Sector
Software & Services 22.47% 22.24% 25.99% 20.85% 21.80%
Net Profit Margin, Industry
Information Technology 22.14% 24.01% 25.53% 21.36% 22.08%

Based on: 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), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Net profit margin = 100 × Net income ÷ Revenues
= 100 × 1,731 ÷ 8,971 = 19.30%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Net profit margin An indicator of profitability, calculated as net income divided by revenue. ServiceNow Inc. net profit margin ratio improved from 2021 to 2022 and from 2022 to 2023.

Return on Equity (ROE)

ServiceNow Inc., ROE calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Net income 1,731 325 230 119 627
Stockholders’ equity 7,628 5,032 3,695 2,834 2,128
Profitability Ratio
ROE1 22.69% 6.46% 6.22% 4.18% 29.45%
Benchmarks
ROE, Competitors2
Accenture PLC 26.75% 31.11% 30.25% 30.05% 33.17%
Adobe Inc. 32.86% 33.85% 32.59% 39.66% 28.03%
International Business Machines Corp. 33.29% 7.47% 30.38% 27.14% 45.25%
Intuit Inc. 13.81% 12.57% 20.89% 35.76% 41.53%
Microsoft Corp. 35.09% 43.68% 43.15% 37.43% 38.35%
Oracle Corp. 792.45% 262.43% 83.94% 50.87%
Palo Alto Networks Inc. 25.15% -127.14% -78.63% -24.23% -5.16%
Salesforce Inc. 0.36% 2.48% 9.81% 0.37% 7.11%
Synopsys Inc. 20.01% 17.85% 14.31% 13.54% 13.04%
ROE, Sector
Software & Services 29.37% 32.03% 37.53% 31.80% 36.15%
ROE, Industry
Information Technology 31.77% 38.39% 42.24% 35.01% 36.30%

Based on: 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), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 1,731 ÷ 7,628 = 22.69%

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity. ServiceNow Inc. ROE improved from 2021 to 2022 and from 2022 to 2023.

Return on Assets (ROA)

ServiceNow Inc., ROA calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Net income 1,731 325 230 119 627
Total assets 17,387 13,299 10,798 8,715 6,022
Profitability Ratio
ROA1 9.96% 2.44% 2.13% 1.36% 10.41%
Benchmarks
ROA, Competitors2
Accenture PLC 13.41% 14.55% 13.68% 13.78% 16.04%
Adobe Inc. 18.23% 17.51% 17.70% 21.66% 14.22%
International Business Machines Corp. 5.55% 1.29% 4.35% 3.58% 6.20%
Intuit Inc. 8.58% 7.45% 13.29% 16.70% 24.78%
Microsoft Corp. 17.56% 19.94% 18.36% 14.70% 13.69%
Oracle Corp. 6.33% 6.15% 10.48% 8.78% 10.20%
Palo Alto Networks Inc. 3.03% -2.18% -4.87% -2.95% -1.24%
Salesforce Inc. 0.21% 1.52% 6.14% 0.23% 3.61%
Synopsys Inc. 11.90% 10.45% 8.66% 8.27% 8.31%
ROA, Sector
Software & Services 11.45% 11.67% 12.60% 10.03% 10.89%
ROA, Industry
Information Technology 13.08% 15.08% 15.61% 12.12% 12.73%

Based on: 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), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 1,731 ÷ 17,387 = 9.96%

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROA A profitability ratio calculated as net income divided by total assets. ServiceNow Inc. ROA improved from 2021 to 2022 and from 2022 to 2023.