ServiceNow Leadership In AI, Agentic AI Drives Q2 Growth: CFO Gina Mastantuono

‘ServiceNow holds a distinct advantage, because we’re the only company that has AI plus data plus workflows on one platform, and in an agentic AI world, that’s a game changer and a huge differentiator. It allows us to deliver real business outcomes at scale,’ says Gina Mastantuono, ServiceNow president and chief financial officer.

ServiceNow’s finance chief credited greater customer acceptance of AI and agentic AI with the “exceptional” better-than-expected financial results in the company’s most recent quarter.

The Santa Clara, Calif.-based developer of AI-focused business transformation technology’s second fiscal quarter blew away estimates across the board, significantly beating the high end of ServiceNow’s guidance across all the top line and bottom line metrics, said Gina Mastantuono, ServiceNow president and chief financial officer.

“It’s our unique platform approach to AI,” Gina Mastantuono, ServiceNow president and chief financial officer, told CRN in an interview before earnings were released Wednesday. “AI plus data plus workflow, all on the one ServiceNow platform, really helps drive what I think is continued exceptional results across the board. [Non-GAAP] subscription revenue is up 21.5 percent, cRPO (current remaining performance obligation) is up 21.5 percent, both are 200 basis points above the top end of our guidance.”

In addition, Mastantuono said, the Now platform is “sticky.”

“It resonates so well with customers, with continued best-in-class renewal rates at 98 percent,” she said. “And on top of the numbers is the remarkable transformation that our customers are driving. It just continues to inspire me every day, and we’re just incredibly grateful to partner with some of the world’s biggest brands and most innovative companies as they make their journey in this new AI-enabled enterprise world that we find ourselves in. Think about the likes of Starbucks, Exxon Mobile, Standard Chartered, Intuit, Merck, all really big brands, innovative companies leading with business transformation and AI first. I’m inspired every day to work with what I think are some of the most exceptional companies out there.”

Despite the massive changes the Trump administration is making to federal government operation, Mastantuono said the government is still a growing customer of ServiceNow’s.

“Federal agencies are navigating a lot of changes, including tightening budgets to evolving mission demand,” she said. “And what I’m super proud of is that I believe ServiceNow continues to rise to the occasion. The team in Q2 executed very well. I would say market conditions played out as we anticipated in Q2, and in fact, U.S. public sector closed six new logos in Q2 alone. We’re able to do that despite everything going on, because we’re delivering exactly what federal agencies need most right now. It’s what the administration is driving: speed, efficiency, modernization, and scale, especially for agentic AI. And what I love about it is that it’s not just a short-term play. The longer-term opportunity is massive, given what the administration is trying to do—drive accountability, cost savings, modernization of scale—and ServiceNow and our agentic AI platform is purpose-built for this moment because we’re really able to provide solutions to help the government become more transparent, more accountable, and dramatically more efficient.”

While the IT industry as a whole has been slow to adopt agentic AI, and is expressing concerns about the technology, the enterprise AI race is on as far as ServiceNow is concerned, Mastantuono said.

“ServiceNow holds a distinct advantage, because we’re the only company that has AI plus data plus workflows on one platform, and in an agentic AI world, that’s a game changer and a huge differentiator,” she said. “It allows us to deliver real business outcomes at scale. Our AI net-new ACV (annual contract value) exceeded expectations yet again in Q2 so we’re seeing an increase in both deal volume and deal size, quarter over quarter. Twenty-one of our deals in Q2 alone feature five or more of our AI products. They were in 18 of our top 20 deals. Deal volume grew 50 percent quarter-over-quarter, and we landed our largest Now Assist AI deal to date, at over $20 million.”

Mastantuono agreed AI is not perfect, but said it continues to get better and better every quarter.

“But it’s only as good as the data it has access to,” she said. “Our Workflow Data Fabric, which allows our customers to pull in real-time data from any source to power AI, was also included in 17 of our top 20 deals. RaptorDB, which is our next-gen database for AI, continues to gain traction. Every major region beat expectations. Customers know they need to align their AI strategy. They need to do it fast, or else they’re going to be left behind. And so while certainly all new technology always continues to improve over time, ServiceNow is leading from a position of strength and really helping our customers transform as they’re thinking about this once-in-a-generational shift in the enterprise.”

Mastantuono declined to discuss U.S. Department of Justice regulatory concerns about ServiceNow’s planned acquisition of Moveworks, saying the company does not comment on ongoing regulatory reviews. However, she said, the company expects the deal to close in the second half of 2025 or early 2026.

ServiceNow By The Numbers

For its second fiscal quarter 2025, which ended June 30, ServiceNow reported total revenue of $3.22 billion, up 22.5 percent over the $2.63 billion the company reported for its second fiscal quarter 2024.

That included subscription revenue of $3.11 billion, up 22.5 percent, and professional services and other revenue of $102 million, up 19.5 percent.

ServiceNow also reported GAAP net income of $385 million or $1.84 per share, up from last year’s $262 million or $1.26 per share. On a non-GAAP basis, the company reported net income of $854 million or $4.09 per share, up from last year’s $651 million or $3.13 per share.

Looking ahead, ServiceNow expects third quarter 2025 subscription revenue to be in the $3.26 billion to $3.265 billion range, up between 20 percent and 20.5 percent over the same period last year.

For its full year 2025, ServiceNow raised revenue guidance to $12.78 billion to $12.80 billion, up about 20 percent over fiscal 2024.

ServiceNow’s stock skyrocketed more than 7 percent in after-hours trading to $1,025 per share Wednesday.