Perhaps indicative of the fragility of the current rebound - as Software stocks have recently ripped higher for 8 straight days - SaaS stocks are all deeply in the red after-hours as ServiceNow - the potential poster-child for AI disruption - cut its margin outlook amid lackluster results, sending shares reeling.
At first glance, it was a good print- the provider of business task management software posted first-quarteradjusted earnings of 97 cents a share, which was in-linewith Wall Street estimates, according to FactSet.
Revenuefor the quarter rose 22% to $3.77 billion,marginally above analyst expectations of $3.75 billion.
Additionally, ServiceNow said thatsubscription revenue will increase about 23%to $3.82 billion in Q2, the company said (marginally above the consensusof $3.75 billion).
But, it appears Wall Street was hoping for more - with investors already worried about the disruptive impact of AI on software stocks - as NOW shares sank 13% in extended trading...
...afterthe software company also cut its full-year forecast for subscription adjusted gross margin...
The software giant now expects a 31.5% margin on its full-year adjusted income from operations, whereas ServiceNow (NOW) was previously targeting a 32% margin.
The company's forecast for a 26.5% adjusted operating margin in the second quarter is also meaningfully below the 30.1% Wall Street consensus
But have no fear, the future looks incredibly rosy!!??
The lukewarm result was blamed on the Mideast conflict:
Source: ZeroHedge News
