ServiceNow continued to grow at a steady pace with revenue increasing by 125% between fiscal 2009 and 2010, and by 97.5% between fiscal 2010 and 2011. In 2011, Luddy was named as the winner of the Ernst & Young Entrepreneur of the Year. “About seven years ago I decided to do something about the existing state of enterprise IT software. I knew there had to be a better way. Fast forward a few years and I began to realize ServiceNow has a very real opportunity to become one of the largest, most successful software companies in the world – unimaginable when it was just a handful of us in a little office in Del Mar, California. A combination of market dynamics, customer focus, innovative technology, a little luck and a lot of hard work got us here,” said Luddy...

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THE BUSINESS MODEL

ServiceNow operated in the high growth SaaS business vertical in cloud computing. ServiceNow offered a cloud based platform that helped businesses by automating routine processes across organizations. Its software helped to create digital workflows, increase both productivity and collaboration across departments, and eventually create better experiences for their customers as well as users. “In software everyone claims to be a platform play, but in reality there are only a few that can make that claim, and ServiceNow is one of them,” said Matthew Hedberg, an analyst at RBC Capital..

UNIQUE FEATURES

ServiceNow generated steady growth with the digital transformation of IT systems compared to its competitors that offered software and applications in the cloud. The company ranked among the fastest growing in the application software industry. According to analysts, its business model offered some competitive advantages, especially in the medium and long term...

STRONG FINANCIALS

ServiceNow’s strong financials added to its growth story and made its stock more attractive than that of its peers. ServiceNow had delivered double-digit growth in revenue since 2007. The company had also delivered a steady earnings stream which it was able to achieve due to the expense discipline implemented in the company, and higher contracts value, which in turn helped in an expansion of margins. ..

THE ROAD AHEAD

Analysts were of the opinion that ServiceNow would continue to expand its customer base as well as existing relationships, which would help the company to reach its growth target. Moreover, a steady subscription and renewal rate and a strong balance sheet would continue to help the company achieve double-digit growth across regions including the US, EMEA, APAC, and North America..

EXHIBITS

Exhibit I: ServiceNow Products
Exhibit II:ServiceNow’s 5 Year Cumulative Total Return
Exhibit III: ServiceNow’s Financial Highlights
Exhibit IV: ServiceNow’s Earnings and Revenue Growth (2013-2019)
Exhibit V:Comparison of ServiceNow’s Growth with its Competitors