ServiceNow Inc. (NYSE:NOW)

Total assets and adjusted total assets both demonstrate a consistent upward trend from 2021 through 2025. However, the magnitude of growth differs between the two figures, indicating a systematic adjustment being applied to the reported total assets.

Overall Growth

Total assets increased from US$10,798 million in 2021 to US$26,038 million in 2025, representing a cumulative growth of approximately 141.1%. Adjusted total assets grew from US$10,106 million to US$24,982 million over the same period, a cumulative increase of roughly 147.3%.

Growth Rate Comparison

While both metrics exhibit growth, the adjusted total assets consistently show a slightly higher percentage increase year-over-year than the reported total assets. This suggests the adjustments, while not reversing the overall growth, are moderating the reported asset value.

Adjustment Amount

The difference between total assets and adjusted total assets widened over the period. In 2021, the adjustment amounted to US$692 million. By 2025, this difference had grown to US$1,056 million. This increasing disparity suggests the items being adjusted are growing in magnitude or that the adjustment methodology is becoming more impactful.

The consistent application of adjustments to total assets warrants further investigation to understand the nature of these adjustments and their impact on the company’s financial position. The increasing difference between the two figures suggests a growing influence of these adjustments on the overall asset base.

Current liabilities exhibited a consistent upward trend over the five-year period, increasing from US$4,949 million in 2021 to US$10,443 million in 2025. This represents a substantial overall increase. However, adjusted current liabilities demonstrate a different pattern, with a more moderate increase and a slight decrease in 2024.

Overall Trends

The growth in current liabilities significantly outpaced the growth in adjusted current liabilities. This suggests that a growing portion of the reported current liabilities are subject to adjustment, or that the nature of current liabilities is changing.

Growth Rates

From 2021 to 2022, current liabilities increased by 21.4%. This growth rate slowed to 22.6% from 2022 to 2023, then to 12.7% from 2023 to 2024, and finally to 24.9% from 2024 to 2025. Adjusted current liabilities increased by 21.3% from 2021 to 2022, 17.5% from 2022 to 2023, but decreased by 3.8% from 2023 to 2024 before increasing by 38.4% from 2024 to 2025.

2024 Anomaly

The year 2024 presents a notable deviation from the general trend. While current liabilities continued to increase, adjusted current liabilities experienced a decrease. This could indicate a one-time adjustment, a change in accounting practices, or a shift in the composition of current liabilities that year. Further investigation into the nature of these adjustments in 2024 is warranted.

Magnitude of Adjustments

In 2021, adjusted current liabilities represented approximately 22.5% of total current liabilities. This percentage decreased to 22.4% in 2022, then to 21.5% in 2023, 18.4% in 2024, and increased to 20.3% in 2025. The decreasing percentage from 2021 to 2024 suggests that the adjustments, relative to the overall current liability balance, were becoming less significant, but the increase in 2025 reverses this trend.

The substantial increase in both current and adjusted current liabilities in 2025 warrants further scrutiny. Understanding the drivers behind these increases, particularly for the adjusted portion, is crucial for a comprehensive financial assessment.

Total liabilities exhibited a consistent upward trend from 2021 through 2025. Conversely, adjusted total liabilities demonstrated a more moderate and, at times, fluctuating increase over the same period. A significant divergence exists between the reported and adjusted figures, suggesting substantial adjustments are being made to the initially reported liability values.

Total Liabilities Trend

Total liabilities increased from US$7,103 million in 2021 to US$13,074 million in 2025, representing a cumulative growth of approximately 84.1%. The growth rate appears to have accelerated in the later years of the period, with a larger absolute increase between 2023 and 2025 compared to earlier periods.

Adjusted Total Liabilities Trend

Adjusted total liabilities rose from US$3,195 million in 2021 to US$4,598 million in 2025, a cumulative increase of roughly 44.0%. While consistently increasing overall, the growth was not linear. A slight decrease was observed between 2022 and 2023, followed by a more substantial increase between 2024 and 2025.

Relationship Between Reported and Adjusted Liabilities

The difference between total liabilities and adjusted total liabilities widened over the analyzed period. In 2021, the adjustment reduced reported liabilities by approximately 55.3%. By 2025, this reduction had increased to approximately 64.8%. This suggests that the nature or magnitude of the adjustments is becoming more significant relative to the overall liability position.

The consistent adjustments to total liabilities warrant further investigation to understand the underlying reasons. Potential causes could include reclassifications of liabilities, changes in accounting standards, or corrections of prior-period errors. The accelerating divergence between reported and adjusted figures suggests a growing impact from these adjustments on the overall financial position.

Stockholders’ equity and adjusted stockholders’ equity both demonstrate consistent growth over the five-year period. However, a significant difference exists between the reported and adjusted values, and the adjusted equity exhibits a more substantial rate of increase.

Overall Growth

Stockholders’ equity increased from US$3,695 million in 2021 to US$12,964 million in 2025, representing a cumulative growth of 250.8%. Adjusted stockholders’ equity grew from US$6,911 million in 2021 to US$20,384 million in 2025, a cumulative increase of 195.2%.

Year-over-Year Changes – Stockholders’ Equity

The largest year-over-year increase in stockholders’ equity occurred between 2022 and 2023, with an increase of US$2,596 million. Growth slowed between 2023 and 2024 to US$1,981 million, then accelerated again between 2024 and 2025 with an increase of US$3,355 million.

Year-over-Year Changes – Adjusted Stockholders’ Equity

Similar to stockholders’ equity, adjusted stockholders’ equity experienced its largest year-over-year increase between 2022 and 2023, increasing by US$2,900 million. The increase from 2023 to 2024 was US$3,158 million, and from 2024 to 2025, it increased by US$5,200 million. The absolute dollar increases in adjusted equity are consistently higher than those observed in reported equity.

Difference Between Reported and Adjusted Equity

In 2021, adjusted stockholders’ equity was US$3,216 million higher than reported stockholders’ equity. This difference widened over time, reaching US$7,420 million in 2025. The increasing disparity suggests the adjustments being made to stockholders’ equity are becoming more material.

Growth Rate Comparison

While both metrics show positive growth, the adjusted stockholders’ equity consistently exceeds the growth observed in the reported stockholders’ equity. This indicates that the adjustments are contributing significantly to the overall increase in equity.

The consistent and substantial adjustments to stockholders’ equity warrant further investigation to understand the nature of these adjustments and their impact on the overall financial position. The accelerating growth in both reported and adjusted equity suggests a period of strong performance and/or significant capital activity.

The financial information reveals notable shifts in the capitalization structure over the five-year period. Reported total debt demonstrates relative stability, exhibiting only marginal increases annually. Conversely, stockholders’ equity displays a consistent and substantial upward trend. This growth in equity significantly impacts the reported total capital, which also increases steadily throughout the period.

However, adjustments to these figures present a different perspective. Adjusted total debt shows a more pronounced increase than the reported debt, while adjusted stockholders’ equity demonstrates a considerably larger growth rate compared to the reported equity. Consequently, adjusted total capital expands at a faster pace than reported total capital.

Debt Trends

Reported total debt remains relatively flat, fluctuating between US$1,486 million and US$1,576 million. The adjusted total debt, however, increases from US$2,214 million in 2021 to US$2,403 million in 2025, indicating that adjustments consistently increase the debt position. The difference between reported and adjusted debt widens over time.

Equity Trends

Reported stockholders’ equity experiences significant growth, rising from US$3,695 million in 2021 to US$12,964 million in 2025. The adjusted stockholders’ equity exhibits even more substantial growth, moving from US$6,911 million to US$20,384 million over the same period. The adjustments consistently result in a higher equity value than what is initially reported.

Capital Structure Shifts

Reported total capital increases from US$5,271 million to US$14,455 million. The adjusted total capital demonstrates a more rapid expansion, growing from US$9,125 million to US$22,787 million. This suggests that the adjustments to debt and equity collectively contribute to a larger overall capital base than initially indicated by the reported figures. The proportion of equity to total capital appears to increase when considering the adjusted figures.

The consistent application of adjustments results in a materially different capitalization structure than what is presented in the reported financial statements. The adjustments notably increase both the debt and equity positions, leading to a larger overall capital base. The growth rate of adjusted equity significantly outpaces that of reported equity, suggesting the adjustments are having a substantial impact on the perceived equity value.

Revenues and adjusted revenues both demonstrate a consistent upward trend over the five-year period. However, a notable difference exists between the two figures each year, with adjusted revenues consistently exceeding reported revenues.

Overall Growth

Reported revenues increased from US$5,896 million in 2021 to US$13,278 million in 2025, representing a cumulative growth of 125.3%. Adjusted revenues experienced a similar trajectory, growing from US$6,787 million in 2021 to US$14,798 million in 2025, a cumulative increase of 118.2%.

Year-over-Year Growth

The year-over-year growth rate for reported revenues fluctuated. Growth from 2021 to 2022 was 23.1%, followed by 23.8% from 2022 to 2023. Growth slowed to 22.3% from 2023 to 2024, and then to 20.8% from 2024 to 2025. Adjusted revenues exhibited similar patterns, with growth rates of 18.7%, 25.1%, 20.4%, and 22.7% over the same periods.

Adjustment Magnitude

The difference between reported and adjusted revenues widened over time. In 2021, adjusted revenues exceeded reported revenues by US$991 million. By 2025, this difference had grown to US$1,520 million. This suggests that the nature or magnitude of adjustments applied to revenues is increasing.

Adjustment Percentage

The percentage adjustment to revenues, calculated as (Adjusted Revenues - Revenues) / Revenues, was approximately 15.1% in 2021. This percentage decreased to 11.1% in 2022, then increased to 12.6% in 2023, and further to 9.9% in 2024, before rising to 11.1% in 2025. The fluctuation in this percentage indicates a changing relationship between reported and adjusted figures.

The consistent presence of adjustments to revenues warrants further investigation to understand the underlying reasons for these modifications and their impact on the overall financial picture. The increasing absolute difference between reported and adjusted revenues suggests a growing significance of these adjustments.

Reported net income demonstrates substantial fluctuations over the five-year period. Initially, net income increased from US$230 million in 2021 to US$325 million in 2022. A significant surge is then observed in 2023, reaching US$1,731 million, followed by a decrease to US$1,425 million in 2024. Net income recovers in 2025, reaching US$1,748 million.

Adjusted net income exhibits a consistently upward trend throughout the period, albeit with varying rates of growth. The adjusted figure began at US$1,027 million in 2021 and increased to US$1,035 million in 2022, indicating a modest initial growth rate. Subsequent years show accelerated growth, reaching US$2,075 million in 2023, US$2,540 million in 2024, and culminating in US$3,606 million in 2025.

Relationship between Reported and Adjusted Net Income

A considerable divergence exists between reported and adjusted net income. Adjusted net income consistently exceeds reported net income across all observed years. The difference between the two figures widens over time, suggesting that a growing amount of adjustments are being made to arrive at the adjusted figure. This indicates the presence of significant non-recurring items or other adjustments impacting the reported results.

Growth Trends

While reported net income experiences volatility, adjusted net income demonstrates a robust and sustained growth trajectory. The growth rate of adjusted net income appears to be accelerating, particularly from 2023 onwards. This suggests that underlying business performance, as reflected in the adjusted figures, is strengthening.

Implications of Adjustments

The substantial adjustments to net income warrant further investigation. Understanding the nature of these adjustments is crucial for assessing the quality of earnings and the sustainability of future performance. The increasing magnitude of adjustments suggests a potential need to analyze the underlying drivers and their impact on the company’s financial position.