Here’s why ServiceNow’s stock soared in a week of dismal tech earnings reports
If you’re a regular reader of this publication, chances are you know that it hasn’t been a great year for many tech company stocks — one in which giants like Meta, Amazon, and Alphabet have been mauled by the markets after less than stellar earnings reports.
Even an enterprise stalwart like Salesforce is behind hounded by activist investors.
The fact is that few have been spared, whether startups or established public companies. We’ve seen a litany of stories on hiring freezes, layoff announcements, and tech stocks taking bigger hits than an NFL quarterback behind a bad offensive line — in other words, getting crushed.
SaaS stocks in particular are having a rough year, so when a SaaS stock does well, well, that’s news. And that’s what happened to ServiceNow this week when it reported Q32022 earnings.
It bucked the odds with a mostly positive earnings report — good revenue, good guidance, the whole nine yards — and believe it or not, Wall Street rewarded the company, with the stock up over 13% at the bell on Thursday, a number that held steady throughout the day. (It was down around 1% so far in trading today.)
Maybe we’re not the only ones looking for some good news. Perhaps investors are, too. But what led to this positive 2022 earnings anomaly? To find out, let’s explore the earnings report and the impact of hiring former SAP CEO Bill McDermott to lead the company.
A look at the numbers
Given the general carnage we’ve seen in the public markets for tech earnings this quarterly cycle — Snap kicked things off with a raspberry, followed quickly by other leading tech shops failing to meet Wall Street’s stringent expectations — the ServiceNow share-price boomlet caught our eye and made us curious what the company had managed that was so worthy of investor praise.
