JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
Moody’s Ratings upgraded ServiceNow, Inc.’s (NYSE:NOW) long-term issuer rating and senior unsecured notes rating to A2 from A3, maintaining a positive outlook. The ratings action reflects Moody’s expectation that ServiceNow’s business and financial profile will continue to strengthen through robust growth and balanced financial policies.
ServiceNow has demonstrated a solid track record of expanding its addressable markets by extending its service desk success into broader IT workflows and non-IT business workflows. Moody’s projects ServiceNow’s revenues to increase by approximately 20% to $13 billion in 2025, with similar growth rates expected over the next 2 to 3 years despite the company’s large scale.
The software company maintains substantial financial flexibility with $10.9 billion in cash and investments compared to $1.5 billion of outstanding debt. Its total debt to EBITDA ratio was modestly below 1x at the end of March 2025. Moody’s expects ServiceNow’s free cash flow to exceed $4 billion in 2025 and $5 billion in 2026.
ServiceNow holds a leading position to capitalize on market opportunities created by generative artificial intelligence and agentic AI technologies. The company has integrated AI technologies into numerous products offered at higher average selling prices, leveraging its large customer base and access to workflow data across various organizational systems.
The A2 rating is supported by ServiceNow’s $22.1 billion in Remaining Performance Obligations and approximately 98% renewal rates based on Annual Contract Values. Moody’s indicated the rating could be upgraded further if ServiceNow continues diversifying revenues and maintaining conservative financial strategies, while a downgrade could occur if revenue growth decelerates or if debt-to-EBITDA exceeds 2x.
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