B

ServiceNow, Inc. — Earnings Quality Grade B

NOW · Technology

Generally healthy

Revenue
$13.3B
2025
Net Income
$1.7B
2025
Gross Margin
77.5%
Free Cash Flow
$4.5B
01

Screening Summary

15
Passed
2
Watch
0
Failed
-2.91
M-Score

Management Signals

No recent CEO, CFO, board, or accounting leadership signals found in SEC 8-K filings.
02

Financial Trends

Revenue & Net Income ($B)

Margins (%)

03

18-Point Screening

01

Revenue Quality

A1DSO Change

DSO 72 days, change -2 days YoY

A2AR vs Revenue Growth

AR growth 17.3% vs revenue growth 20.9%

A3Revenue vs CFFO

Revenue 20.9%, CFFO 27.6%. Cash follows revenue

02

Expense Quality

B1Inventory vs COGS

No material inventory

B2CapEx vs Revenue

CapEx growth 2.1% vs revenue 20.9%. Normal

B3SG&A Ratio

SG&A/Gross Profit = 53.5%. Normal

B4Gross Margin

Gross margin 77.5%, change -1.6pp. Stable

03

Cash Flow Quality

C1CFFO vs Net Income

CFFO/NI = 3.11. Profits backed by cash

C2Free Cash Flow

FCF $4.5B, FCF/NI = 2.59

C3Accruals Ratio

Accruals ratio = -14.2%. Low accruals

C4Cash vs Debt

Cash $6.3B covers debt $2.4B

04

Balance Sheet Health

!
D1Goodwill + Intangibles

Goodwill+Intangibles $4.7B = 36% of equity

D2Leverage

Debt/EBITDA = 0.8x. Healthy

D3Soft Asset Growth

Other assets -0.3% vs revenue 20.9%. Normal

D4Asset Impairment

No write-off data

05

Acquisition Risk

E1Serial Acquirer FCF

FCF after acquisitions positive

!
E2Goodwill Surge

Goodwill+Intangibles surged 217% YoY

06

Manipulation Score

F1Beneish M-Score

M-Score = -2.91 (< -2.22). Unlikely manipulator

Portfolio monitoring

Monitor NOW continuously

The full checks and model details are free to read. Use Watchlist to track your holdings; Pro adds automatic quarterly rescoring, risk-event email alerts, scans up to 50 tickers, and export workflows.

04

Beneish M-Score

Manipulation Probability-2.91
-4.0 Clean-2.22 Grey-1.78 Danger0
0.97
DSRI
AR growing faster than revenue?
1.021
GMI
Gross margin declining?
1.117
AQI
Asset quality deteriorating?
1.209
SGI
Revenue growth rate
0.97
DEPI
Depreciation slowing?
0.952
SGAI
SG&A ratio changing?
-0.1419
TATA
Accruals level
0.949
LVGI
Leverage increasing?
05

Altman Z-Score

2.29
Grey Zone
0 Distress1.102.605.0+ Safe
0.0011
Liquidity
0.2013
Cumulative profit
0.0877
Operating efficiency
0.9916
Leverage

Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25

·Latest Quarterly Check

About this →

NOW is sitting near the watch threshold across the last 5–6 quarters.

  • Q3 · GM compressionGM: 78.9% → 75.1% (-385 bp)

Updated 2026-05-19