ServiceNow Earnings: Solid Quarter With AI Galore; Guidance Light Based on Currency Pressure

We are raising our fair value estimate for wide-moat ServiceNow to $990 per share from $900 after the company reported fourth-quarter results that were generally in line with or better than our expectations. While headline guidance was shy of our model on revenue, this is explained by worsening currency headwinds. Profitability was slightly better than anticipated. Our fair value estimate moves higher based on slightly higher growth and profitability estimates for 2026 and 2027. Concurrent with earnings, the company made a variety of announcements, including new agentic artificial intelligence features and expanded partnerships with Google and Oracle. The shares had appreciated about 80% from June until recent highs, which we thought was aggressive. Given the pullback after hours and our fair value estimate increase, we now see the shares as approximately fairly valued.