ServiceNow Inc. (NYSE: NOW) is down 11% at the end of the week, in which the company delivered its fourth-quarter earnings report. The headline numbers were fine, and revenue of $2.96 billion was 21% higher year-over-year (YoY). However, it was only in line with expectations. Earnings per share of $3.67 beat expectations by one penny ($3.66). Another bright spot came from subscription revenue, which was up 23% YoY.
But the company’s guidance seemed to spook investors. For example, the company is guiding subscription revenue growth of around 18%- 19% in the coming year. Analysts are weighing a deceleration in growth, no matter how slight, against a stock that looks priced for accelerating growth.
