Stock Analysis on Net

ServiceNow Inc. (NYSE:NOW)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

ServiceNow Inc., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Goodwill 1,273 1,231 824 777 241
Developed technology 581 516 434 415 226
Patents 83 72 72 69 65
Other 11 11 15 14 4
Intangible assets, gross 675 599 521 498 295
Accumulated amortization (466) (375) (289) (211) (141)
Intangible assets, net 209 224 232 287 153
Goodwill and intangible assets 1,482 1,455 1,056 1,064 394

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Item Description The company
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. ServiceNow Inc. goodwill increased from 2022 to 2023 and from 2023 to 2024.
Intangible assets, net Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. ServiceNow Inc. intangible assets, net decreased from 2022 to 2023 and from 2023 to 2024.
Goodwill and intangible assets Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. ServiceNow Inc. goodwill and intangible assets increased from 2022 to 2023 and from 2023 to 2024.

Adjustments to Financial Statements: Removal of Goodwill

ServiceNow Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Adjustment to Total Assets
Total assets (as reported) 20,383 17,387 13,299 10,798 8,715
Less: Goodwill 1,273 1,231 824 777 241
Total assets (adjusted) 19,110 16,156 12,475 10,021 8,474
Adjustment to Stockholders’ Equity
Stockholders’ equity (as reported) 9,609 7,628 5,032 3,695 2,834
Less: Goodwill 1,273 1,231 824 777 241
Stockholders’ equity (adjusted) 8,336 6,397 4,208 2,918 2,594

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).


ServiceNow Inc., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Goodwill (Summary)

ServiceNow Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Total Asset Turnover
Reported total asset turnover 0.54 0.52 0.54 0.55 0.52
Adjusted total asset turnover 0.57 0.56 0.58 0.59 0.53
Financial Leverage
Reported financial leverage 2.12 2.28 2.64 2.92 3.07
Adjusted financial leverage 2.29 2.53 2.96 3.43 3.27
Return on Equity (ROE)
Reported ROE 14.83% 22.69% 6.46% 6.22% 4.18%
Adjusted ROE 17.09% 27.06% 7.72% 7.88% 4.57%
Return on Assets (ROA)
Reported ROA 6.99% 9.96% 2.44% 2.13% 1.36%
Adjusted ROA 7.46% 10.71% 2.61% 2.30% 1.40%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. ServiceNow Inc. adjusted total asset turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
ServiceNow Inc. adjusted financial leverage ratio decreased from 2022 to 2023 and from 2023 to 2024.
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. ServiceNow Inc. adjusted ROE improved from 2022 to 2023 but then slightly deteriorated from 2023 to 2024 not reaching 2022 level.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. ServiceNow Inc. adjusted ROA improved from 2022 to 2023 but then slightly deteriorated from 2023 to 2024.

ServiceNow Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Revenues 10,984 8,971 7,245 5,896 4,519
Total assets 20,383 17,387 13,299 10,798 8,715
Activity Ratio
Total asset turnover1 0.54 0.52 0.54 0.55 0.52
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Revenues 10,984 8,971 7,245 5,896 4,519
Adjusted total assets 19,110 16,156 12,475 10,021 8,474
Activity Ratio
Adjusted total asset turnover2 0.57 0.56 0.58 0.59 0.53

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 Total asset turnover = Revenues ÷ Total assets
= 10,984 ÷ 20,383 = 0.54

2 Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 10,984 ÷ 19,110 = 0.57

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. ServiceNow Inc. adjusted total asset turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Total assets 20,383 17,387 13,299 10,798 8,715
Stockholders’ equity 9,609 7,628 5,032 3,695 2,834
Solvency Ratio
Financial leverage1 2.12 2.28 2.64 2.92 3.07
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 19,110 16,156 12,475 10,021 8,474
Adjusted stockholders’ equity 8,336 6,397 4,208 2,918 2,594
Solvency Ratio
Adjusted financial leverage2 2.29 2.53 2.96 3.43 3.27

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 Financial leverage = Total assets ÷ Stockholders’ equity
= 20,383 ÷ 9,609 = 2.12

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 19,110 ÷ 8,336 = 2.29

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
ServiceNow Inc. adjusted financial leverage ratio decreased from 2022 to 2023 and from 2023 to 2024.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Net income 1,425 1,731 325 230 119
Stockholders’ equity 9,609 7,628 5,032 3,695 2,834
Profitability Ratio
ROE1 14.83% 22.69% 6.46% 6.22% 4.18%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income 1,425 1,731 325 230 119
Adjusted stockholders’ equity 8,336 6,397 4,208 2,918 2,594
Profitability Ratio
Adjusted ROE2 17.09% 27.06% 7.72% 7.88% 4.57%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 1,425 ÷ 9,609 = 14.83%

2 Adjusted ROE = 100 × Net income ÷ Adjusted stockholders’ equity
= 100 × 1,425 ÷ 8,336 = 17.09%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. ServiceNow Inc. adjusted ROE improved from 2022 to 2023 but then slightly deteriorated from 2023 to 2024 not reaching 2022 level.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
As Reported
Selected Financial Data (US$ in millions)
Net income 1,425 1,731 325 230 119
Total assets 20,383 17,387 13,299 10,798 8,715
Profitability Ratio
ROA1 6.99% 9.96% 2.44% 2.13% 1.36%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income 1,425 1,731 325 230 119
Adjusted total assets 19,110 16,156 12,475 10,021 8,474
Profitability Ratio
Adjusted ROA2 7.46% 10.71% 2.61% 2.30% 1.40%

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

2024 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × 1,425 ÷ 20,383 = 6.99%

2 Adjusted ROA = 100 × Net income ÷ Adjusted total assets
= 100 × 1,425 ÷ 19,110 = 7.46%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. ServiceNow Inc. adjusted ROA improved from 2022 to 2023 but then slightly deteriorated from 2023 to 2024.