ServiceNow Inc (NOW) saw its loss narrow to $40.66 million, or $0.24 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $333.33 million, or $2.06 a share. On the other hand, adjusted net income for the quarter stood at $41.87 million, or $0.24 a share compared with $14.48 million or $0.09 a share, a year ago. Revenue during the quarter surged 36.26 percent to $416.78 million from $305.88 million in the previous year period. Gross margin for the quarter expanded 288 basis points over the previous year period to 72.06 percent.
Operating loss for the quarter was $42.49 million, compared with an operating loss of $324.15 million in the previous year period.
However, the adjusted operating income for the quarter stood at $5.34 million compared to $24.35 million in the prior year period. At the same time, adjusted operating margin contracted 668 basis points in the quarter to 1.28 percent from 7.96 percent in the last year period.
“We’re off to a strong start in Q1, continuing to diversify our business mix,” said John Donahoe, president and chief executive officer, ServiceNow. “Now 73 percent of all our customers license more than one product up from 50 percent two years ago. As Frank passes the torch, the company is well positioned to deliver on its goals with loyal customers and a growing partner ecosystem.”
For the second-quarter, Servicenow expects revenue to be in the range of $458 million to $463 million. Servicenow expects revenue to be in the range of $1,860 million to $1,880 million for financial year 2017. For the second-quarter, Servicenow expects adjusted revenue to be in the range of $469 million to $474 million. Servicenow expects adjusted revenue to be in the range of $1,886 million to $1,906 million for financial year 2017.
Operating cash flow improves significantly
ServiceNow Inc has generated cash of $187.42 million from operating activities during the quarter, up 138.19 percent or $108.74 million, when compared with the last year period. The company has spent $128.45 million cash to meet investing activities during the quarter as against cash outgo of $31.41 million in the last year period.
The company has spent $19.63 million cash to carry out financing activities during the quarter as against cash outgo of $8.69 million in the last year period.
Cash and cash equivalents stood at $439.92 million as on Mar. 31, 2017, down 2.98 percent or $13.53 million from $453.45 million on Mar. 31, 2016.
Working capital increases sharply
ServiceNow Inc has recorded an increase in the working capital over the last year. It stood at $256.45 million as at Mar. 31, 2017, up 76.89 percent or $111.47 million from $144.98 million on Mar. 31, 2016. Current ratio was at 1.22 as on Mar. 31, 2017, up from 1.14 on Mar. 31, 2016.
Days sales outstanding went down to 52 days for the quarter compared with 59 days for the same period last year.
At the same time, days payable outstanding went down to 27 days for the quarter from 37 for the same period last year.
Debt moves up
ServiceNow Inc has witnessed an increase in total debt over the last one year. It stood at $516.49 million as on Mar. 31, 2017, up 7.01 percent or $33.85 million from $482.64 million on Mar. 31, 2016. Servicenow has witnessed an increase in long-term debt over the last one year. It stood at $516.49 million as on Mar. 31, 2017, up 7.01 percent or $33.85 million from $482.64 million on Mar. 31, 2016. Total debt was 23.80 percent of total assets as on Mar. 31, 2017, compared with 25.75 percent on Mar. 31, 2016. Debt to equity ratio was at 1.21 as on Mar. 31, 2017, down from 1.60 as on Mar. 31, 2016.
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