NOW
ServiceNow
Recurring SaaS
★ Quality 34/100Price today
$141.26
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See what it is worthcharlieapp.co
What this business is made of
The business
The nervous system where big companies run all their internal work.
ServiceNow sells a cloud platform that automates companies' internal processes: IT support, human resources, customer service. It charges an annual subscription per module and user. With ~8,800 customers and $28.2B in contracts already signed but not yet billed, the cash comes in before it's spent.
The switching cost is brutal: once half a company's processes live inside the platform, ripping it out is major surgery. The 78% gross margin reveals that pricing power. It's not a monopoly, but putting down roots in the customer's daily operations is an advantage that pays for itself.
Revenue history
From $5.9B to $13.3B in 4 years — nearly 2.3x its size. Selling more and more is the base of everything else.
Where each $100 of sales goes
Revenue $13.3B · FY2025
Of every $100 in sales, $87 goes to costs and operations; $13 is left as net profit (13% margin).
Catalysts and risks
Now Assist: monetizing AI inside the platform, the growth engine for 2026.
$28.2B in signed contracts pending (RPO) that already lock in future revenue.
Expansion beyond IT into human resources and customer service.
Agentic AI could rewrite the workflow layer where its business lives.
No real monopoly: Salesforce and Microsoft push on the same turf.
High multiple that demands growing 20% year after year without stumbling.
Charlie's note
“Paying 23 times earnings for a business growing 21% with a 78% gross margin and zero debt isn't a steal nor a gift: it's paying for quality at its price. Agentic AI is the unknown that keeps me up at night; that's why, a small portion.”
Analysis · July 2026
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