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ServiceNow Gross Margin %

: 77.80% (As of Jun. 2022)
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Gross Margin % is calculated as gross profit divided by its revenue. ServiceNow's Gross Profit for the three months ended in Jun. 2022 was $1,363 Mil. ServiceNow's Revenue for the three months ended in Jun. 2022 was $1,752 Mil. Therefore, ServiceNow's Gross Margin % for the quarter that ended in Jun. 2022 was 77.80%.


The historical rank and industry rank for ServiceNow's Gross Margin % or its related term are showing as below:

NOW' s Gross Margin % Range Over the Past 10 Years
Min: 57.32   Med: 72.64   Max: 78.16
Current: 77.55


During the past 12 years, the highest Gross Margin % of ServiceNow was 78.16%. The lowest was 57.32%. And the median was 72.64%.

NOW's Gross Margin % is ranked better than
82.1% of 2492 companies
in the Software industry
Industry Median: 45.54 vs NOW: 77.55

ServiceNow had a gross margin of 77.80% for the quarter that ended in Jun. 2022 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for ServiceNow was 1.60% per year.


ServiceNow Gross Margin % Historical Data

The historical data trend for ServiceNow's Gross Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

ServiceNow Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Gross Margin %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 73.95 76.13 76.99 78.16 77.05

ServiceNow Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Gross Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 76.65 76.85 76.83 78.57 77.80

Competitive Comparison

For the Software - Application subindustry, ServiceNow's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

ServiceNow Gross Margin % Distribution

For the Software industry and Technology sector, ServiceNow's Gross Margin % distribution charts can be found below:

* The bar in red indicates where ServiceNow's Gross Margin % falls into.



ServiceNow Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

ServiceNow's Gross Margin for the fiscal year that ended in Dec. 2021 is calculated as

Gross Margin % (A: Dec. 2021 )=Gross Profit (A: Dec. 2021 ) / Revenue (A: Dec. 2021 )
=4543 / 5896
=(Revenue - Cost of Goods Sold) / Revenue
=(5896 - 1353) / 5896
=77.05 %

ServiceNow's Gross Margin for the quarter that ended in Jun. 2022 is calculated as


Gross Margin % (Q: Jun. 2022 )=Gross Profit (Q: Jun. 2022 ) / Revenue (Q: Jun. 2022 )
=1363 / 1752
=(Revenue - Cost of Goods Sold) / Revenue
=(1752 - 389) / 1752
=77.80 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.


ServiceNow  (NYSE:NOW) Gross Margin % Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

ServiceNow had a gross margin of 77.80% for the quarter that ended in Jun. 2022 => Durable competitive advantage


Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.


ServiceNow Gross Margin % Related Terms

Thank you for viewing the detailed overview of ServiceNow's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.


ServiceNow Business Description

ServiceNow logo
Address
2225 Lawson Lane, Santa Clara, CA, USA, 95054
ServiceNow Inc provides software solutions to structure and automate various business processes via a SaaS delivery model. The company primarily focuses on the IT function for enterprise customers. ServiceNow began with IT service management (ITSM), expanded within the IT function, and more recently directed its workflow automation logic to functional areas beyond IT, notably customer service, HR service delivery, and security operations. ServiceNow also offers an application development platform as a service (PaaS).
Executives
Caimi Lara officer: Chief Customer & Partner Ofc C/O CONFLUENT, INC. 899 W EVELYN AVENUE MOUNTAIN VIEW CA 94041
Bedi Christopher officer: Chief Information Officer 2225 LAWSON LANE SANTA CLARA CA 95054
Smith Paul John officer: Chief Commercial Officer 2225 LAWSON LANE SANTA CLARA CA 95054
Mcbride Kevin Thomas officer: Principal Accounting Officer 2200 MISSION COLLEGE BLVD SANTA CLARA CA 95054
Tzitzon Nicholas officer: Chief Strat & Corp Affairs Ofc 2225 LAWSON LANE SANTA CLARA CA 95054
Rathnam Sukumar director 2225 LAWSON LANE SANTA CLARA CA 95054
Canney Jacqueline P officer: Chief People Officer 702 SW 8TH STREET BENTONVILLE AR 72716
Quinlan Larry director 2225 LAWSON LANE SANTA CLARA CA 95054
Toledano Gabrielle B officer: Chief Talent Officer 209 REDWOOD SHORES PARKWAY REDWOOD CITY CA 94065
Jackson Lawrence director 2225 LAWSON LANE SANTA CLARA CA 95054
Haverty Kevin officer: Chief Revenue Officer 2225 LAWSON LANE SANTA CLARA CA 95054
Mastantuono Gina officer: Chief Financial Officer 237 PARK AVENUE 14TH FLOOR NEW YORK NY 10017
Mcdermott William R director, officer: President & CEO C/O UNDER ARMOUR, INC. 1020 HULL STREET, 3RD FLOOR BALTIMORE MD 21230
Goon Fay Sien officer: Principal Accounting Officer 2225 LAWSON LANE SANTA CLARA CA 95054
Briggs Teresa director 2225 LAWSON LANE SANTA CLARA CA 95054

ServiceNow Headlines

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