ServiceNow's RPO Soars 29% in Strong Q2 2025 Results

ServiceNow reported strong financial results for Q2 2025, exceeding guidance across all top-line growth and profitability metrics. The company achieved total revenues of $3,215 million, marking a 22.5% year-over-year increase. Subscription revenues were $3,113 million, also growing by 22.5% year-over-year. Net income for the quarter stood at $385 million, representing a 46.6% increase compared to the prior year. This performance surpasses analyst revenue estimates of $3,122,943,530 and EPS estimates of $3.54.

Key Performance Drivers

A significant driver of performance was the growth in remaining performance obligations (RPO), which reached $23.9 billion, up 29% year-over-year. Current remaining performance obligations (cRPO) also increased by 24.5% to $10.92 billion. The number of customers with more than $20 million in Annual Contract Value (ACV) grew by over 30% year-over-year, and the company closed 89 transactions over $1 million in net new ACV in Q2, ending with 528 customers exceeding $5 million in ACV, a 19.5% increase.

Innovation and Strategic Partnerships

ServiceNow's annual Knowledge event showcased major innovations in AI, data, CRM, and enterprise operations, including the introduction of AI Control Tower and AI Agent Fabric. The company expanded its data capabilities with the Workflow Data Network and reimagined CRM for the AI era. Strategic partnerships further strengthened AI capabilities, with collaborations announced with AWS, NVIDIA, UKG, and Cisco to unify data, enhance AI agents, and streamline employee experiences. The acquisition of data.world, which closed in July 2025, is expected to enhance AI agent understanding and data governance.

Global Expansion and Outlook

ServiceNow is expanding its global footprint through partnerships like CapZone Impact Investments to modernize manufacturing facilities, starting with U.S. naval operations. The company also teamed up with Ferrari as an Official Partner and launched the ServiceNow Protected Platform Singapore (SPP-SG) to accelerate AI innovation and bolster data security for the Singapore government and regulated sectors. Looking ahead to Q3 2025, ServiceNow anticipates subscription revenues between $3,260 million and $3,265 million, representing 20% to 20.5% year-over-year growth. The company expects cRPO growth of 18.5% year-over-year and an operating margin of 30.5%. For the full year 2025, subscription revenues are projected to be between $12,775 million and $12,795 million, with an expected operating margin of 30.5% and free cash flow margin of 32%.