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A discussion of our financial condition and results of operations for the fiscal year ended December 31, 2022 and year-to-year comparisons between fiscal 2023 and fiscal 2022 that is not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed on January 25, 2024.
−Removed: Our free cash flow measure included in the section entitled “—Key Business Metrics—Free Cash Flow,” is not in accordance with GAAP.
−Removed: This non-GAAP financial measure is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP.
−Removed: This measure may be different from non-GAAP financial measures used by other companies, limiting its usefulness for comparison purposes.
+Added: Our free cash flow and non-GAAP consolidated income from operations measures included in the section entitled “—Key Business Metrics—Free Cash Flow” and “—Key Business Metrics—Non-GAAP Consolidated Income from Operations” are not in accordance with GAAP.
+Added: These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP.
+Added: These measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes.
We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP results, to more fully understand our business.
1 unchanged sentence
to make work flow better.
−Removed: Our purpose is to make the world work better for everyone.
−Removed: Our intelligent platform, the Now Platform, is a cloud-based solution with embedded artificial intelligence and machine learning capabilities that helps global enterprises across industries, universities and governments unify and digitize their workflows.
−Removed: The Now Platform automates workflows across an entire enterprise by connecting disparate departments, systems and silos in a seamless way to unlock productivity and improve experiences for both employees and customers.
+Added: Our intelligent platform, the Now Platform, is a cloud-based solution that helps enterprises and organizations across public and private sectors digitize workflows, in line with our purpose of making the world work better for everyone.
Our workflow applications built on the Now Platform are organized along four primary areas:
Technology, Customer and Industry, Employee and Creator.
−Removed: The transformation to digital operations, enabled by the Now Platform, increases our customers’ resiliency and security and delivers great experiences and additional value to their C-suite, employees and consumers.
−Removed: We are closely monitoring the unfolding events of the Russian invasion of Ukraine and the current armed conflict in Israel and the Gaza Strip.
−Removed: While these events are still evolving and the outcome remains highly uncertain, we do not believe the conflicts will have a material impact on our business and results of operations.
+Added: The Now Platform is the AI platform for digital transformation.
+Added: Transformations enabled by the Now Platform rapidly automate business processes across an entire enterprise by seamlessly connecting disparate departments, systems and silos to unlock productivity and improve experiences for both employees and customers.
+Added: We are closely monitoring the ongoing conflicts in Russia/Ukraine and the Middle East.
+Added: While these events are still evolving and the outcomes remain highly uncertain, we do not believe these conflicts will have a material impact on our business and results of operations.
However, if the conflicts continue or worsen, leading to greater global economic disruptions and uncertainty, our business and results of operations could be materially impacted.
−Removed: Our customers in these regions represented an immaterial portion of our net assets and total consolidated revenues both as of and for the year ended December 31, 2023 and December 31, 2022.
−Removed: Additionally, other macroeconomic events, including rising interest rates, global inflation and bank failures, have led to economic uncertainty in the global economy.
+Added: Our customers in these regions represented an immaterial portion of our net assets and total consolidated revenues both as of and for the years ended December 31, 2024 and December 31, 2023.
+Added: Additionally, other macroeconomic events, including higher interest rates, global inflation and bank failures, have led to economic uncertainty in the global economy.
To mitigate risk, our cash and cash equivalents are distributed across several large financial institutions and are not concentrated in one financial institution.
−Removed: We have not experienced any impact to our liquidity or to our current and projected business operations and financial condition due to recent bank failures.
+Added: We have not experienced any impact to our liquidity or to our current and projected business operations and financial condition due to recent macroeconomic events.
Further, we have policy restrictions on the types of securities that can be purchased as part of our available-for-sale debt securities portfolio.
These restrictions take industry and company concentration limits into consideration among other things.
−Removed: Furthermore, the majority of our non-marketable equity investments do not have material relationships with any one financial institution, and therefore, we believe that our exposure to loss is immaterial.
+Added: Furthermore, the majority of our non-marketable equity investments do not have material relationships with any one financial institution, and therefore, we believe that our exposure to loss as a result of bank failure is immaterial.
We will continue to monitor the direct and indirect impact of macroeconomic events on our business and financial results.
−Removed: See the “Risk Factors” section in Part I, Item 1A of this Annual Report for further discussion of the possible impact of the above conflicts and macroeconomic events on our business and financial results .
+Added: See the “Risk Factors” section in Part I, Item 1A of this Annual Report for further discussion of the possible impact of conflicts and macroeconomic events on our business and financial results .
Key Business Metrics
50 unchanged sentences
Purchases of property and equipment (852) (694) (550)
−Removed: Repayments of convertible senior notes attributable to debt discount
Business combination and other related costs
+Added: Legal settlements
Free cash flow
1 unchanged sentence
We have historically seen higher collections in the quarter ended March 31 due to seasonality in timing of entering into customer contracts, which is significantly higher in the quarter ended December 31.
−Removed: Additionally, we have historically seen higher disbursements in the quarters ended March 31 and September 30 due to payouts under our annual commission plans, purchases under our employee stock purchase plan, payouts under our bonus plans and coupon payments related to our 2030 Notes beginning in 2021.
+Added: Additionally, we have historically seen higher disbursements in the quarters ended March 31 and September 30 due to payouts under our annual commission plans, purchases under our employee stock purchase plan, payouts under our bonus plans and coupon payments related to our 2030 Notes.
+Added: Non-GAAP consolidated income from operations.
+Added: Non-GAAP consolidated income from operations is identified as an additional measure of profit or loss.
+Added: This non-GAAP measure is used by the chief operating decision maker to allocate resources and assess performance.
+Added: We define non-GAAP consolidated income from operations as income from operations excluding certain non-cash or non-recurring items, including stock-based compensation expense, amortization of purchased intangibles, legal settlements and business combination and other related costs.
+Added: We believe these adjustments provide useful supplemental information to investors and facilitate the analysis of our operating results and comparison of those results across reporting periods.
+Added: The following table shows the reconciliation of our reported consolidated income from operations to non-GAAP consolidated income from operations.
+Added: Year Ended December 31,
+Added: 2024 2023 2022
+Added: (in millions)
+Added: GAAP income from operations
+Added: $ 1,364 $ 762 $ 355
+Added: Stock-based compensation
+Added: 1,746 1,604 1,401
+Added: Amortization of purchased intangibles
+Added: Business combination and other related costs
+Added: Legal settlements
+Added: Non-GAAP income from operations
+Added: $ 3,254 $ 2,489 $ 1,860
Renewal rate.
17 unchanged sentences
Actual results may differ from these estimates under different assumptions or conditions and such differences could be material.
−Removed: Tabl e of Contents
While our significant accounting policies are more fully described in Note 2 in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the following accounting policies are critical to the process of making significant judgments and estimates in the preparation of our audited consolidated financial statements.
23 unchanged sentences
We evaluate these estimates and assumptions as new information is obtained and may record adjustments to the fair value of the tangible and intangible assets acquired and liabilities assumed but not later than one year from the acquisition date.
−Removed: Tabl e of Contents
Our annual tax rate is based on our income, statutory tax rates and tax planning opportunities available to us in the various jurisdictions in which we operate.
14 unchanged sentences
federal and state deferred tax assets will be realizable, with the exception of California.
−Removed: We continue to maintain a valuation allowance against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
−Removed: Of the $1.2 billion valuation allowance as of December 31, 2022, we released $1.05 billion of our valuation allowance during the year ended December 31, 2023.
−Removed: We maintained a valuation allowance of $196 million against our California deferred tax assets.
+Added: We released $1.05 billion of our valuation allowance during the year ended December 31, 2023.
+Added: As of December 31, 2024 and 2023, we maintained a valuation allowance of $220 million and $196 million, respectively, against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
We will continue to monitor the need for a valuation allowance against our deferred tax assets on a quarterly basis.
−Removed: See Note 16 – Income Taxes, in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information on discussion on valuation allowance.
+Added: Refer to Note 16 “Provision for (Benefit from) Income Taxes,” in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information on our valuation allowance.
Our tax positions are subject to income tax audits by multiple tax jurisdictions throughout the world.
10 unchanged sentences
To the extent the assessment of such tax position changes, we record the change in estimate in the period in which we make the determination.
−Removed: Tabl e of Contents
Change in Accounting Estimate
In January 2024, we completed an assessment of the useful life of our data center equipment and determined we should increase the estimated useful life of data center equipment from four to five years.
−Removed: This change in accounting estimate will be effective beginning fiscal year 2024.
−Removed: Based on the carrying amount of data center equipment included in property and equipment, net that are in-service as of December 31, 2023, it is estimated this change will increase our fiscal year 2024 operating income by approximately $100 million.
+Added: This change in accounting estimate was effective beginning fiscal year 2024.
+Added: Refer to Note 2 “Summary of Significant Accounting Policies,” in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information on our change in estimated useful life of our data center equipment during 2024.
Components of Results of Operations
8 unchanged sentences
Our arrangements for professional services are primarily on a time-and-materials basis, and we generally invoice our customers monthly in arrears for the professional services based on actual hours and expenses incurred.
−Removed: Some of our professional services arrangements are on a fixed fee.
+Added: Some of our professional services arrangements are on a fixed-fee basis.
Professional services revenues are recognized as services are delivered.
3 unchanged sentences
We also sell services through managed service providers and resale partners.
−Removed: We also generate revenues from certain professional services and from training of customers and partner personnel, through both our direct team and indirect channel sales.
−Removed: Revenues from our direct sales organization represented 79% of our total revenues for each of the years ended December 31, 2023, 2022 and 2021.
+Added: We also generate revenues from certain professional services and from training of customers and partner personnel, through both our direct team and indirect sales channel.
+Added: Revenues from our direct sales organization represented 78% of our total revenues for the year ended December 31, 2024 and 79% of our total revenues for each of the years ended December 31, 2023 and 2022.
For purposes of calculating revenues from our direct sales organization, revenues from systems integrators and managed services providers are included as part of the direct sales organization.
9 unchanged sentences
Although these seasonal factors may be common in the technology industry, historical patterns should not be considered a reliable indicator of our future sales activity or performance.
−Removed: Tabl e of Contents
Cost of Revenues
1 unchanged sentence
Cost of subscription revenues consists primarily of expenses related to hosting our services and providing support to our customers.
−Removed: These expenses are comprised of data center capacity costs, which include colocation costs associated with our data centers as well as interconnectivity between data centers, depreciation related to our infrastructure hardware equipment dedicated for customer use, amortization of intangible assets, expenses associated with software, public cloud service costs, IT services and dedicated customer support, personnel-related costs directly associated with data center operations and customer support, including salaries, benefits, bonuses and stock-based compensation and allocated overhead.
+Added: These expenses are comprised of data center capacity costs, which include colocation costs associated with our data centers as well as interconnectivity between data centers, depreciation related to our infrastructure hardware equipment dedicated for customer use, amortization of intangible assets, expenses associated with software, public cloud service costs, IT services and dedicated customer support, personnel-related costs directly associated with data center operations and customer support, including salaries, benefits, bonuses, stock-based compensation and allocated overhead.
Cost of professional services and other revenues .
8 unchanged sentences
Research and Development
−Removed: Research and development expenses consist primarily of personnel-related expenses directly associated with our research and development staff, including salaries, benefits, bonuses and stock-based compensation and allocated overhead.
+Added: Research and development expenses consist primarily of personnel-related expenses directly associated with our research and development staff, including salaries, benefits, bonuses, stock-based compensation and allocated overhead.
Research and development expenses also include data center capacity costs, costs associated with outside services contracted for research and development purposes and depreciation of infrastructure hardware equipment that is used solely for research and development purposes.
General and Administrative
−Removed: General and administrative expenses consist primarily of personnel-related expenses for our executive, finance, legal, human resources, facilities and administrative personnel, including salaries, benefits, bonuses and stock-based compensation, external legal, accounting and other professional services fees, other corporate expenses, amortization of intangible assets and allocated overhead.
−Removed: (Benefit from) Provision for Income Taxes
−Removed: (Benefit from) provision for income taxes consists of federal, state and foreign income taxes.
−Removed: Our income tax benefit for the year ended December 31, 2023 is primarily attributable to the release of the valuation allowance against certain U.S.
−Removed: federal and state deferred tax assets, excluding California.
+Added: General and administrative expenses consist primarily of personnel-related expenses for our executive, finance, legal, human resources, facilities and administrative personnel, including salaries, benefits, bonuses, stock-based compensation, external legal, accounting and other professional services fees, other corporate expenses, amortization of intangible assets and allocated overhead.
+Added: Provision for (Benefit from) Income Taxes
+Added: Provision for (benefit from) income taxes consists of federal, state and foreign income taxes.
+Added: Our income tax provision for the year ended December 31, 2024 is primarily attributable to the mix of earnings and losses in countries with differing statutory tax rates, offset by excess tax benefits of stock-based compensation.
We continue to maintain a valuation allowance against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
−Removed: Tabl e of Contents
Comparison of the years ended December 31, 2024 and 2023
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Our remaining product offerings, primarily comprised of our IT Operations Management (“ITOM”) products, are predominantly priced on a subscription unit basis.
−Removed: Professional services and other revenues decreased by $63 million for the year ended December 31, 2023, compared to the prior year, due to a decrease in services and trainings provided to new and existing customers as we focused on deploying our internal professional services organization as a strategic resource and worked with our partner ecosystem to contract directly with customers for implementation services delivery.
−Removed: We expect professional services and other revenues for the year ending December 31, 2024 to increase in absolute dollars and to remain relatively flat as a percentage of revenue compared to the year ended December 31, 2023 as we continue to execute our professional services strategy.
−Removed: Tabl e of Contents
+Added: Professional services and other revenues increased by $47 million for the year ended December 31, 2024, compared to the prior year, due to an increase in services and trainings provided to new and existing customers.
+Added: We expect professional services and other revenues for the year ending December 31, 2025 to remain relatively flat both in absolute dollars and as a percentage of revenue compared to the year ended December 31, 2024.
Cost of Revenues and Gross Profit Percentage
5 unchanged sentences
Total cost of revenues $ 2,287 $ 1,921 19 %
−Removed: Gross profit percentage:
+Added: Gross profit (loss) percentage:
Subscription 82 % 82 %
5 unchanged sentences
Personnel-related costs, including stock-based compensation and overhead expenses, increased by $230 million as compared to prior year.
−Removed: Depreciation expense related to infrastructure hardware equipment dedicated for customer use increased by $97 million for the year ended December 31, 2023, as compared to prior year and maintenance costs to support the expansion of our data center capacity, including public cloud service costs, increased by $77 million, as compared to prior year.
−Removed: We expect our cost of subscription revenues for the year ending December 31, 2024 to increase in absolute dollars as we provide subscription services to more customers and increase usage within our customer instances but remain relatively flat as a percentage of revenue compared to the year ended December 31, 2023.
+Added: Expenses associated with software, maintenance, and other costs to support the expansion of our data center capacity increased by $85 million for the year ended December 31, 2024, as compared to prior year.
+Added: We expect our cost of subscription revenues for the year ending December 31, 2025 to increase in absolute dollars as we provide subscription services to more customers and increase usage within our customer instances and increase slightly as a percentage of revenue compared to the year ended December 31, 2024.
We will continue to incur incremental costs to attract customers in regulated markets by adopting public cloud offerings as well as increased support for customers impacted by new and evolving data residency requirements.
To the extent future acquisitions are consummated, our cost of subscription revenues may increase due to additional non-cash charges associated with the amortization of intangible assets acquired.
−Removed: Our subscription gross profit percentage was 82% and 83% for the years ended December 31, 2023 and 2022, respectively.
−Removed: We expect our subscription gross profit percentage to remain relatively flat for the year ending December 31, 2024 compared to the year ended December 31, 2023.
−Removed: Cost of professional services and other revenues decreased by $71 million for the year ended December 31, 2023 as compared to the prior year.
−Removed: The decrease was primarily due to a decrease in contracted third-party partners spend and decreased headcount resulting in a decrease in personnel-related costs, including stock-based compensation.
−Removed: Our professional services and other gross loss percentage improved to 8% for the year ended December 31, 2023, compared to 9% in the prior year, primarily due to decreased headcount resulting in a decrease in personnel-related costs and a decrease in contracted third-party partners spend.
−Removed: We expect our professional services and other gross loss percentage to improve for the year ending December 31, 2024 compared to the year ended December 31, 2023.
−Removed: Tabl e of Contents
+Added: Our subscription gross profit percentage was 82% for each of the years ended December 31, 2024 and 2023.
+Added: We expect our subscription gross profit percentage to decrease slightly for the year ended December 31, 2025 compared to the year ended December 31, 2024.
+Added: Cost of professional services and other revenues increased by $30 million for the year ended December 31, 2024 as compared to the prior year, primarily due to an increase in partner ecosystem investments to further accelerate customer value realization, partially offset by a decrease in fixed personnel-related costs, including stock-based compensation, due to decreased internal headcount.
+Added: Our professional services and other gross loss percentage improved to 2% for the year ended December 31, 2024, compared to 8% in the prior year, primarily due to an increase in revenue and a decrease in fixed personnel-related costs, including stock-based compensation, as we execute our strategy to shift a portion of professional services to variable spending with strategic third-party partners.
+Added: We expect our professional services and other gross loss percentage to increase for the year ending December 31, 2025 compared to the year ended December 31, 2024.
Sales and Marketing
5 unchanged sentences
Amortization expenses associated with deferred commissions increased by $90 million, compared to the prior year, due to an increase in contracts with new customers, expansion and renewal contracts.
−Removed: Other sales and marketing program expenses, which include branding, costs associated with purchasing advertising, marketing events and market data, increased by $44 million compared to the prior year, primarily due to increased program costs and travel for our annual Sales Kickoff.
−Removed: We expect sales and marketing expenses for the year ending December 31, 2024 to increase in absolute dollars and to decrease as a percentage of revenue compared to the year ended December 31, 2023, as we continue to see leverage from increased sales productivity and marketing efficiencies in 2024.
+Added: Other sales and marketing program expenses, which include branding, costs associated with purchasing advertising, marketing events and market data, increased by $95 million compared to the prior year, primarily due to increased program costs and travel for our annual Sales Kickoff and Knowledge user conference.
+Added: We expect sales and marketing expenses for the year ending December 31, 2025 to increase in absolute dollars and to decrease slightly as a percentage of revenue compared to the year ended December 31, 2024, as we continue to see leverage from increased sales productivity and marketing efficiencies.
Research and Development
4 unchanged sentences
Research and development expenses (“R&D”) increased by $419 million during the year ended December 31, 2024, compared to the prior year, primarily due to increased headcount resulting in an increase in personnel-related costs including stock-based compensation and overhead expenses of $350 million compared to prior year.
−Removed: The remaining increase was primarily due to an increase in data center capacity costs and depreciation of infrastructure hardware equipment that is used solely for R&D purposes of $27 million for the year ended December 31, 2023, compared to the prior year.
+Added: Outside services increased by $48 million during the year ended December 31, 2024, compared to the prior year.
+Added: The remaining increase was primarily due to expenses associated with software, maintenance and other costs to support the expansion of our data center capacity of $27 million for the year ended December 31, 2024, compared to the prior year.
+Added: These costs were partially offset by a decrease in program spend of $12 million for the year ended December 31, 2024, compared to the prior year.
We expect R&D expenses for the year ending December 31, 2025 to increase in absolute dollars but remain relatively flat as a percentage of revenue compared to the year ended December 31, 2024, as we continue to improve the existing functionality of our services, develop new applications to fill market needs and enhance our core platform.
4 unchanged sentences
Percentage of revenues 9 % 10%
−Removed: General and administrative expenses (“G&A”) increased by $128 million during the year ended December 31, 2023, compared to the prior year, primarily due to increased headcount resulting in an increase in personnel-related costs including stock-based compensation and overhead expenses of $83 million.
−Removed: Non-personnel-related costs and outside services increased by $32 million for the year ended December 31, 2023 compared to the prior year.
−Removed: Tabl e of Contents
−Removed: We expect G&A expenses for the year ending December 31, 2024 to increase in absolute dollars but decrease slightly as a percentage of revenue compared to the year ended December 31, 2023, as we continue to see leverage from continued G&A productivity.
+Added: General and administrative expenses (“G&A”) increased by $73 million during the year ended December 31, 2024, compared to the prior year, primarily due to increased headcount resulting in an increase in personnel-related costs, excluding stock-based compensation, of $37 million.
+Added: The remaining increase was primarily due to an increase in other corporate expenses and outside services of $67 million for the year ended December 31, 2024, compared to the prior year.
+Added: These costs were partially offset by a decrease in stock-based compensation of $36 million for the year ended December 31, 2024, compared to the prior year, primarily due to the requisite service period of certain performance awards being met.
+Added: We expect G&A expenses for the year ending December 31, 2025 to increase in absolute dollars but remain relatively flat as a percentage of revenue compared to the year ended December 31, 2024, as we continue to see leverage from continued G&A productivity.
Stock-based Compensation
12 unchanged sentences
Stock-based compensation is inherently difficult to forecast due to fluctuations in our stock price.
−Removed: Based upon our stock price as of December 31, 2023, we expect stock-based compensation to continue to increase in absolute dollars for the year ending December 31, 2024 as we continue to issue stock-based awards to our employees but decrease slightly as a percentage of revenue compared to the year ended December 31, 2023.
+Added: Based upon our stock price as of December 31, 2024, we expect stock-based compensation to continue to increase in absolute dollars for the year ending December 31, 2025 as we continue to issue stock-based awards to our employees but remain relatively flat as a percentage of revenue compared to the year ended December 31, 2024.
We expect stock-based compensation as a percentage of revenue to decline over time as we continue to grow.
2 unchanged sentences
Revenues outside North America represented 37% and 36% of total revenues for the years ended December 31, 2024 and 2023, respectively.
−Removed: Because we primarily transact in foreign currencies for sales outside of the United States, the general weakening of the U.S.
−Removed: Dollar relative to certain major foreign currencies (primarily the Euro and British Pound Sterling) during the year ended December 31, 2023 had a favorable impact on our revenues.
−Removed: For entities reporting in currencies other than the U.S.
−Removed: Dollar, if we had translated our results for the year ended December 31, 2023 at the exchange rates in effect for the year ended December 31, 2022 rather than the actual exchange rates in effect during the period, our reported subscription revenues would have been $34 million lower fo r the year ended December 31, 2023.
−Removed: T he impact from the foreign currency movements from the year ended December 31, 2022 to the year ended December 31, 2023 was not material to professional services and other revenues.
−Removed: In addition, because we primarily transact in foreign currencies for cost of revenues and operating expenses outside of the United States, the general strengthening of the U.S.
−Removed: Dollar relative to other major foreign currencies had a favorable impact on our R&D expenses during the year ended December 31, 2023.
−Removed: For entities reporting in currencies other than the U.S.
−Removed: Dollar, if we had translated our results for the year ended December 31, 2023 at the exchange rates in effect for the year ended December 31, 2022 rather than the actual exchange rates in effect during the period, our reported R&D expenses would have been $12 million higher for the year ended December 31, 2023.
−Removed: The impact from the foreign currency movements from the year ended December 31, 2022 to the year ended December 31, 2023 was not material to cost of revenues, sales and marketing and G&A expenses.
−Removed: Tabl e of Contents
+Added: We primarily transact in certain foreign currencies for sales outside of the United States.
+Added: The movement of the U.S.
+Added: Dollar had an immaterial impact on our revenues for the year ended December 31, 2024.
+Added: In addition, we primarily transact in several foreign currencies for cost of revenues and operating expenses outside of the United States.
+Added: The movement of the U.S.
+Added: Dollar had an immaterial impact on our expenses for the year ended December 31, 2024.
Interest Income
4 unchanged sentences
Percentage of revenues 4 % 3 %
−Removed: Interest income increased during the year ended December 31, 2023, compared to the prior year primarily driven by an increase in investment income from our managed portfolio resulting from higher portfolio balances and an increase in interest rates.
+Added: Interest income increased during the year ended December 31, 2024, compared to the prior year, primarily driven by an increase in investment income from our managed portfolio resulting from higher portfolio balances with higher interest rates.
Other Expense, net
6 unchanged sentences
Percentage of revenues — % (1%)
−Removed: Other expense, net increased by $18 million during the year ended December 31, 2023, compared to the prior year, primarily driven by higher unrealized losses on foreign currency forward contracts.
−Removed: To mitigate our risks associated with fluctuations in foreign currency exchange rates, we enter into foreign currency derivative contracts with maturities of 12 months or less to hedge a portion of our net outstanding monetary assets and liabilities.
+Added: Other expense, net decreased by $11 million during the year ended December 31, 2024, compared to the prior year, primarily due to a decrease in net losses on equity investments.
+Added: To mitigate our risks associated with fluctuations in foreign currency exchange rates, we enter into foreign currency forward contracts with maturities of 12 months or less to hedge a portion of our net outstanding monetary assets and liabilities.
These hedging contracts may reduce, but cannot entirely eliminate, the impact of adverse currency exchange rate movements.
The gains (losses) recognized for these foreign currency forward contracts in other expense, net, were immaterial for each of the years ended December 31, 2024 and 2023.
−Removed: Tabl e of Contents
−Removed: (Benefit from) provision for Income Taxes
+Added: Provision for (benefit from) Income Taxes
Year Ended December 31, % Change
1 unchanged sentence
Income before income taxes $ 1,738 $ 1,008 72 %
−Removed: (Benefit from) provision for income taxes
+Added: Provision for (benefit from) income taxes
Effective tax rate 18 % (72 %) NM
NM - Not meaningful
−Removed: Our effective tax rate was (72%) and 19% for the year ended December 31, 2023 and December 31, 2022.
−Removed: The difference in rates was primarily attributable to the release of the valuation allowance against certain U.S.
−Removed: federal and state deferred tax assets, excluding California in the year ended December 31, 2023.
+Added: The income tax provision was $313 million for the year ended December 31, 2024.
+Added: The income tax provision was primarily attributable to the mix of earnings and losses in countries with differing statutory tax rates, offset by excess tax benefits of stock-based compensation.
The income tax benefit was $723 million for the year ended December 31, 2023.
7 unchanged sentences
federal and state deferred tax assets will be realizable, with the exception of California.
−Removed: We continue to maintain a valuation allowance against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
−Removed: Of the $1.2 billion valuation allowance as of December 31, 2022, we released $1.05 billion of our valuation allowance during the year ended December 31, 2023.
−Removed: We maintained a valuation allowance of $196 million against our California deferred tax assets.
+Added: We released $1.05 billion of our valuation allowance during the year ended December 31, 2023.
+Added: As of December 31, 2024, we continue to maintain a valuation allowance against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
We will continue to monitor the need for a valuation allowance against our deferred tax assets on a quarterly basis.
−Removed: In December 2021, the Organization for Economic Cooperation and Development adopted model rules for a 15% global minimum tax (Pillar 2) and has continued to issue administrative guidance and interpretations.
−Removed: Approximately 20 countries have enacted the rules into their domestic tax legislation.
−Removed: The United States has not enacted the rules.
−Removed: Due to the uncertainty of whether the United States and other countries will enact the rules, the timing of individual country legislative action and the underlying complexity of the rules, the impact, if any, on the Company is not reasonably estimable.
−Removed: See Note 16– Income Taxes, in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for our reconciliation of income taxes at the statutory federal rate to the provision for income taxes.
−Removed: Tabl e of Contents
Liquidity and Capital Resources
−Removed: We generate cash inflows from operations primarily from selling subscription services which are generally paid in advance of provisioning services, and cash outflows to develop new services and core technologies that further enhance the Now Platform, engage our customer and enhance their experience, and enable and transform our business operations.
+Added: We generate cash inflows from operations primarily from selling subscription services which are generally paid in advance of provisioning services, and expend cash outflows to develop new services and core technologies that further enhance the Now Platform, engage our customers and enhance their experience, and enable and transform our business operations.
Subscription services arrangements typically have a three-year duration, and we have experienced a renewal rate of 98% for each of the years ended December 31, 2024, 2023 and 2022.
2 unchanged sentences
When assessing sources of liquidity, we also include cash and cash equivalents, short-term investments and long-term investments totaling $9.9 billion as of December 31, 2024.
−Removed: Our working capital requirements are principally comprised of non-contract workforce salaries, bonuses, commissions, and benefits and, to a lesser extent, cancellable and non-cancellable licenses and services arrangements that are integral to our business operations, and operating lease obligations.
+Added: Our capital requirements are principally comprised of capital expenditures to support data center capacity expansion, non-contract workforce salaries, bonuses, commissions, and benefits and, to a lesser extent, cancellable and non-cancellable licenses, operating leases and services arrangements that are integral to our business operations.
+Added: We also acquire technology and businesses to expand our service offerings and functionality.
+Added: Our capital expenditures are under cancellable and non-cancellable arrangements.
Non-cancellable purchase commitments for business operations total $4.1 billion as of December 31, 2024, due primarily over the next five years.
2 unchanged sentences
In May 2023, our board of directors authorized a program to repurchase up to $1.5 billion of our common stock.
−Removed: During the year ended December 31, 2023, we repurchased 0.9 million shares of our common stock for $538 million.
+Added: During the year ended December 31, 2024, the Company repurchased 0.8 million shares of our common stock for $696 million.
All repurchases were made in open market transactions.
Repurchases of common stock are recognized as treasury stock and held for future issuance.
−Removed: As of December 31, 2023, $962 million of the originally authorized amount under the Share Repurchase Program remained available for future repurchases.
−Removed: To grow our business, we also invest in capital and other resources to expand our data centers and enable our workforce, and we acquire technology and businesses to supplement our technology portfolio.
−Removed: Our capital expenditures are typically under cancellable arrangements primarily used to support the installed base and growth of our hosted business.
+Added: As of December 31, 2024, approximately $266 million of the originally authorized amount under the share repurchase program remained available for future repurchases.
+Added: In January 2025, our board of directors authorized an additional $3.0 billion in repurchases under the share repurchase program.
+Added: Refer to Note 13 “Stockholders’ Equity” to our consolidated financial statements included in this Annual Report on Form 10-K for additional information.
We have also issued long-term debt to finance our business .
5 unchanged sentences
Year Ended December 31,
−Removed: (in millions)
+Added: (dollars in millions)
Net cash provided by operating activities $ 4,267 $ 3,398
1 unchanged sentence
Net cash used in financing activities (1,343) (803)
−Removed: Net increase/(decrease) in cash, cash equivalents and restricted cash
+Added: Net increase in cash, cash equivalents and restricted cash
Operating Activities
Net cash provided by operating activities was $4.3 billion for the year ended December 31, 2024 compared to $3.4 billion for the prior year.
−Removed: The net increase in operating cash flow was primarily due to higher collections driven by revenue growth.
−Removed: Tabl e of Contents
+Added: The net increase in operating cash flows was primarily due to higher collections driven by revenue growth.
Investing Activities
Net cash used in investing activities for the year ended December 31, 2024 was $2.5 billion compared to $2.2 billion for the prior year.
−Removed: The net decrease in cash used in investing activities was primarily due to a $681 million decrease in net purchases of investments, a $92 million decrease in purchases of non-marketable investments, offset by a $191 million increase in business combinations and a $144 million increase in purchases of property and equipment.
+Added: The net increase in cash used in investing activities was primarily due to a $167 million increase in net purchases of investments, a $158 million increase in purchases of property and equipment, a $106 million increase in purchases of non-marketable investments and a $37 million increase in purchases of other intangible assets, partially offset by a $166 million decrease in cash used in business combinations.
Financing Activities
Net cash used in financing activities for the year ended December 31, 2024 was $1,343 million compared to $803 million for the prior year.
−Removed: The net increase in cash used in financing activities is primarily due to repurchases of common stock for $538 million, a $32 million increase in taxes paid related to net share settlement of equity awards, offset by a $17 million increase in proceeds from employee stock plans and a $94 million decrease in repayments of convertible senior notes attributable to principal.
+Added: The net increase in cash used in financing activities is primarily due to a $241 million increase in taxes paid related to net share settlement of equity awards, a $184 million increase in business combination related to the second installment payment in the acquisition of G2K Group GmbH and a $158 million increase in repurchases of common stock, offset by a $43 million increase in proceeds from employee stock plans.
Contractual Obligations and Commitments
−Removed: Our estimated future obligations consist of leases, a non-cancellable $500 million agreement with Microsoft to purchase cloud services over five years for accelerating the Azure adoption for mutual customers, the second installment of the consideration for the G2K acquisition to be paid in February 2024, purchase obligations, debt and unrecognized tax benefits as of December 31, 2023.
−Removed: Refer to Note 17 “Commitments and Contingencies,” Note 5 “Business Combinations” and Note 16 “(Benefit from) Provision for Income Taxes” to our consolidated financial statements included in this Annual Report on Form 10-K for more information.
+Added: Our estimated future obligations consist of leases, various non-cancellable agreements with cloud service providers and an information technology equipment provider, purchase obligations, debt and unrecognized tax benefits as of December 31, 2024.
+Added: Refer to Note 17 “Commitments and Contingencies,” and Note 16 “Provision for (Benefit from) Income Taxes” to our consolidated financial statements included in this Annual Report on Form 10-K for more information.
QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK
6 unchanged sentences
Revenues denominated in U.S.
−Removed: Dollar as a percentage of total revenues was 71%, 72% and 70% for the years ended December 31, 2023, 2022 and 2021, respectively.
+Added: Dollar as a percentage of total revenues were 71% for each of the years ended December 31, 2024 and 2023 and 72% for the year ended December 31, 2022.
A hypothetical 10% increase in the U.S.
Dollar against other currencies would have resulted in a decrease in operating income of $150 million, $107 million and $75 million for the years ended December 31, 2024, 2023 and 2022, respectively.
−Removed: This analysis disregards the possibilities that rates can move in opposite directions and that losses from one geographic area may be offset by gains from another geographic area.
−Removed: To mitigate our risks associated with fluctuations in foreign currency exchange rates, we enter into foreign currency derivative contracts to hedge a portion of our net outstanding monetary assets and liabilities.
−Removed: These derivative contracts are intended to offset gains or losses related to remeasuring monetary assets and liabilities that are denominated in currencies other than the functional currency of the entities in which they are recorded.
−Removed: These derivative contracts expose us to credit risk to the extent that the counterparties may be unable to meet the terms of the arrangement.
−Removed: We mitigate this credit risk by transacting with major financial institutions with high credit ratings and entering into master netting arrangements, which permit net settlement of transactions with the same counterparty.
+Added: This analysis disregards the impact from the Company’s cash flow hedging program and possibilities that rates can move in opposite directions and that losses from one geographic area may be offset by gains from another geographic area.
+Added: To mitigate our risks associated with fluctuations in foreign currency exchange rates, we enter into foreign currency forward contracts to hedge a portion of our net outstanding monetary assets, liabilities and forecasted foreign currency denominated revenues.
+Added: These foreign currency forward contracts are intended to offset gains or losses related to remeasuring monetary assets and liabilities and to reduce foreign exchange impact on our forecasted revenues.
+Added: Derivative contracts related to hedging of forecasted revenues are designated as cash flow hedges for accounting purposes.
+Added: For contracts qualifying as cash flow hedges, the derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income (loss) and subsequently reclassified into earnings in the same period the forecasted transaction affects earnings.
+Added: For contracts not designated as cash flow hedges for accounting purposes, the derivative’s gain or loss is recognized immediately in earnings within our consolidated statements of comprehensive income.
+Added: A sensitivity analysis performed on our cash flow hedge portfolio as of December 31, 2024 indicated that a hypothetical 10% depreciation of the U.S.
+Added: Dollar from its value as of December 31, 2024 would decrease the fair value of our foreign currency contracts by $164 million.
+Added: These foreign currency forward contracts expose us to credit risk to the extent that the counterparties may be unable to meet the terms of the arrangement.
+Added: We mitigate this credit risk by transacting with major financial institutions with high credit ratings.
While the contract or notional amount is often used to express the volume of foreign currency derivative contracts, the amounts potentially subject to credit risk are generally limited to the amounts, if any, by which the counterparties’ obligations under the agreements exceed our obligations to the counterparties.
2 unchanged sentences
Refer to Note 8 in the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
−Removed: Tabl e of Contents
Interest Rate Sensitivity
12 unchanged sentences
As of December 31, 2024 and 2023, we had $469 million and $268 million, respectively, of non-marketable equity investments in privately held companies.
−Removed: Recording upward and downward adjustments to the carrying value of our non-marketable equity investments requires quantitative assessments of the fair value of our non-marketable equity investments using various valuation methodologies and involves the use of estimates.
+Added: Our non-marketable equity investments are primarily accounted for using:
+Added: (i) measurement alternative which measures the investments at cost minus impairment, if any, and adjusted for observable transactions for the same or similar investments of the same issuer and (ii) equity method which measures the investment at cost minus impairment, plus or minus our share of equity method investee income or loss.
+Added: For those non-marketable equity investments using measurement alternative, recording upward and downward adjustments to the carrying value of these non-marketable equity investments requires quantitative assessments of the fair value of our non-marketable equity investments using various valuation methodologies and involves the use of estimates.
The timing and amount of observable price changes are influenced by market dynamics that can impact the valuation of our non-marketable equity investments.
These changes could be material based on market conditions and events.
−Removed: Tabl e of Contents
+Added: All of our non-marketable equity investments in privately held companies are subject to a risk of partial or total loss of invested capital.
CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
8 unchanged sentences
Notes to Consolidated Financial Statements
−Removed: Tabl e of Contents
Report of Independent Registered Public Accounting Firm
24 unchanged sentences
and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
−Removed: Tabl e of Contents
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
3 unchanged sentences
The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Subscription revenue recognition - customer contracts with multiple performance obligations
−Removed: As described in Note 2 to the consolidated financial statements, the Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations.
−Removed: Subscription revenues include self-hosted offerings in which customers deploy, or the Company grants customers the option to deploy without significant penalty, the Company’s subscription services internally or contract with a third party to host the software.
−Removed: For these contracts, management accounts for the software element separately from the related support and updates as they are distinct performance obligations.
−Removed: The transaction price allocated to the software element is recognized when transfer of control of the software to the customer is complete.
−Removed: The transaction price allocated to the related support and updates are recognized ratably over the contract term.
−Removed: As disclosed by management, evaluating the terms and conditions included within the Company’s customer contracts for appropriate revenue recognition and determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment.
+Added: Revenue Recognition – Subscription Revenue
+Added: As described in Note 2 to the consolidated financial statements, subscription revenues are primarily comprised of subscription fees that give customers access to the ordered subscription service, related support and updates, if any, to the subscribed service during the subscription term.
+Added: The Company recognizes subscription revenues ratably over the contract term beginning on the commencement date of each contract, which is the date the Company makes their services available to their customers.
+Added: The Company’s contracts with customers typically include a fixed amount of consideration and are generally non-cancellable and without any refund-type provisions.
The Company recognized subscription revenues of $10.6 billion for the year ended December 31, 2024.
−Removed: The principal consideration for our determination that performing procedures relating to subscription revenue recognition for customer contracts with multiple performance obligations is a critical audit matter is the matter involved significant audit effort in performing procedures related to management’s identification of distinct performance obligations.
+Added: The principal considerations for our determination that performing procedures relating to revenue recognition for subscription revenue is a critical audit matter are a high degree of auditor effort in performing procedures and evaluating audit evidence related to the Company’s subscription revenue recognition.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.
−Removed: These procedures included testing the effectiveness of controls relating to the revenue recognition process, including controls over the identification of performance obligations and evaluation of the terms and conditions within the customer contracts for appropriate revenue recognition.
−Removed: These procedures also included, among others, testing management’s process for identifying distinct performance obligations and evaluating the terms and conditions within the customer contracts by examining the customer contracts on a test basis for appropriate revenue recognition.
+Added: These procedures included testing the effectiveness of controls relating to the revenue recognition process for subscription revenue.
+Added: These procedures also included, among others (i) testing subscription revenue transactions, on a sample basis, by obtaining and inspecting source documents, such as contracts, invoices and cash receipts, and recalculating revenue recognized and (ii) testing outstanding customer invoice balances as of December 31, 2024, on a sample basis, by obtaining and inspecting source documents, such as contracts and subsequent cash receipts.
/s/ PricewaterhouseCoopers LLP
2 unchanged sentences
We have served as the Company’s auditor since 2011.
−Removed: Tabl e of Contents
SERVICENOW, INC.
41 unchanged sentences
Treasury stock, at cost (shares held:
+Added: 1,664 and 895 )
+Added: ( 1,219 ) ( 535 )
Additional paid-in capital 7,402 6,131
4 unchanged sentences
See accompanying notes to consolidated financial statements
−Removed: Tabl e of Contents
SERVICENOW, INC.
21 unchanged sentences
Income before income taxes 1,738 1,008 399
−Removed: (Benefit from) provision for income taxes ( 723 ) 74 19
+Added: Provision for (benefit from) income taxes 313 ( 723 ) 74
Net income $ 1,425 $ 1,731 $ 325
3 unchanged sentences
Weighted-average shares used to compute net income per share - diluted 208,423 205,591 203,535
−Removed: Other comprehensive income (loss):
+Added: Other comprehensive (loss) income:
Foreign currency translation adjustments $ ( 93 ) $ 27 $ ( 70 )
Unrealized gains (losses) on investments, net of tax 12 38 ( 66 )
−Removed: Other comprehensive income (loss) 65 ( 136 ) ( 60 )
+Added: Unrealized gains (losses) on derivative instruments, net of tax
+Added: Other comprehensive (loss) income ( 31 ) 65 ( 136 )
Comprehensive income $ 1,394 $ 1,796 $ 189
19 unchanged sentences
Balance as of December 31, 2021 199,608 $ — — $ — $ 3,665 $ ( 4 ) $ 34 $ 3,695
+Added: Cumulative effect adjustment from adoption of Accounting Standards Update (ASU) 2020-06 — — — — ( 19 ) 17 — ( 2 )
Common stock issued under employee stock plans 2,671 — — — 177 — — 177
1 unchanged sentence
Stock-based compensation — — — — 1,400 — — 1,400
−Removed: Shares granted related to business combinations — — — — 6 — — 6
Settlement of 2022 Warrants 603 — — — — — — —
4 unchanged sentences
Balance as of December 31, 2022 202,882 $ — — $ — $ 4,796 $ 338 $ ( 102 ) $ 5,032
−Removed: Cumulative effect adjustment from adoption of Accounting Standards Update (ASU) 2020-06 — — — — ( 19 ) 17 — ( 2 )
−Removed: Common stock issued under employee stock plans 2,671 — — — 177 — — 177
+Added: Common stock and Treasury stock issued under employee stock plans 2,737 — 5 3 190 — — 193
+Added: Common stock repurchased — — ( 900 ) ( 538 ) — — — ( 538 )
Taxes paid related to net share settlement of equity awards — — — — ( 459 ) — — ( 459 )
Stock-based compensation — — — — 1,604 — — 1,604
−Removed: Settlement of 2022 Warrants 603 — — — — — — —
−Removed: Settlement of 2022 Notes conversion feature — — — — ( 233 ) — — ( 233 )
−Removed: Benefit from exercise of 2022 Note Hedge — — — — 233 — — 233
−Removed: Other comprehensive loss, net of tax — — — — — — ( 136 ) ( 136 )
+Added: Other comprehensive income, net of tax — — — — — — 65 65
Net income — — — — — 1,731 — 1,731
2 unchanged sentences
Common stock repurchased — — ( 790 ) ( 696 ) — — — ( 696 )
−Removed: — — ( 900 ) ( 538 ) — — — ( 538 )
Taxes paid related to net share settlement of equity awards — — — — ( 700 ) — — ( 700 )
Stock-based compensation — — — — 1,746 — — 1,746
−Removed: Other comprehensive income, net of tax — — — — — — 65 65
+Added: Other comprehensive loss, net of tax — — — — — — ( 31 ) ( 31 )
Net income — — — — — 1,425 — 1,425
25 unchanged sentences
Business combinations, net of cash acquired ( 113 ) ( 279 ) ( 91 )
+Added: Purchases of other intangibles ( 40 ) ( 3 ) —
Purchases of investments ( 5,031 ) ( 4,634 ) ( 4,038 )
7 unchanged sentences
Repurchases of common stock
+Added: ( 696 ) ( 538 ) —
Taxes paid related to net share settlement of equity awards ( 700 ) ( 459 ) ( 427 )
+Added: Business combination ( 184 ) — —
Net cash used in financing activities
21 unchanged sentences
(1) Description of the Business
−Removed: ServiceNow was founded on a simple premise to make work flow better.
−Removed: Our intelligent platform, the Now Platform, is a cloud-based solution with embedded artificial intelligence and machine learning capabilities that helps global enterprises across industries, universities and governments unify and digitize their workflows.
+Added: ServiceNow was founded on a simple premise:
+Added: to make work flow better.
+Added: Our intelligent platform, the Now Platform, is a cloud-based solution that helps enterprises and organizations across public and private sectors digitize workflows, in line with our purpose of making the world work better for everyone.
Our workflow applications built on the Now Platform are organized along four primary areas:
1 unchanged sentence
The products under each of our workflows help customers connect, automate and empower work across systems and silos to enable great outcomes for businesses and great experiences for people.
−Removed: The Now Platform orchestrates work across our customers’ cloud platforms and systems of choice, allowing our customers to get work done regardless of their current and future preferred systems of record and collaboration platforms.
+Added: The Now Platform is the AI platform for digital transformation.
+Added: As the foundation for how we deliver our cross-enterprise digital workflows, the Now Platform orchestrates work across our customers’ cloud platforms and systems of choice, allowing them to get work done regardless of their current and future preferred systems of record and collaboration platforms.
(2) Summary of Significant Accounting Policies
9 unchanged sentences
In January 2024, we completed an assessment of the useful life of our data center equipment and determined we should increase the estimated useful life of data center equipment from four to five years .
−Removed: This change in accounting estimate will be effective beginning fiscal year 2024.
−Removed: Our chief operating decision maker, the Chief Executive Officer, allocates resources and assesses financial performance based upon discrete financial information at the consolidated level.
−Removed: There are no segment managers who are held accountable by the chief operating decision maker, or anyone else, for operations, operating results and planning for levels or components below the consolidated unit level.
−Removed: Accordingly, we have determined that we operate as a single operating and reportable segment.
+Added: This change in accounting estimate was effective beginning fiscal year 2024.
+Added: Based on the carrying amount of data center equipment included in property and equipment, net as of December 31, 2023, the effect of this change in estimate for the year ended December 31, 2024, was a reduction in depreciation expense of $ 101 million and an increase in net income of $ 81 million, or $ 0.39 per share basic and $ 0.39 per share diluted.
+Added: Our chief operating decision maker (“CODM”), the Chief Executive Officer, manages the Company’s business activities as a single operating and reportable segment at the consolidated level.
+Added: Accordingly, our CODM uses consolidated net income to measure segment profit or loss, allocate resources and assess performance.
+Added: Further, the CODM reviews and utilizes functional expenses (cost of revenues, sales and marketing, research and development, and general and administrative) at the consolidated level to manage the Company’s operations.
+Added: Other segment items included in consolidated net income are interest income, other expense, net and the provision for (benefit from) income taxes, which are reflected in the consolidated statements of comprehensive income.
Foreign Currency Translation and Transactions
−Removed: The functional currencies for our foreign subsidiaries are primarily their respective local currencies.
−Removed: Assets and liabilities of the wholly-owned foreign subsidiaries are translated into U.S.
+Added: The functional currency for most of our foreign subsidiaries is their respective local currency.
+Added: Assets and liabilities of the wholly-owned non-U.S.
+Added: Dollar functional currency subsidiaries are translated into U.S.
Dollars at exchange rates in effect at each period end.
2 unchanged sentences
The resulting translation adjustments are recorded in accumulated other comprehensive income (loss) as a component of stockholders’ equity.
−Removed: Foreign currency transaction gains and losses are included in other expense, net within the consolidated statements of comprehensive income, and have not been material for all periods presented.
+Added: Foreign currency transaction gains and losses are included in other expense, net within the consolidated statements of comprehensive income, and were immaterial for all periods presented.
Revenue Recognition
13 unchanged sentences
Our professional services arrangements are primarily on a time-and-materials basis, and we generally invoice our customers monthly in arrears for these professional services based on actual hours and expenses incurred.
−Removed: Some of our professional services arrangements are on a fixed fee.
+Added: Some of our professional services arrangements are on a fixed-fee basis.
Professional services revenues are recognized as services are delivered.
10 unchanged sentences
To the extent we bill customers in advance of the billing period commencement date, the accounts receivable and corresponding deferred revenue amounts are netted to zero on our consolidated balance sheets, unless such amounts have been paid as of the balance sheet date.
−Removed: Customer deposits primarily relate to payments received from customers which could be refundable pursuant to the terms of the contract and are presented under accrued expenses and other current liabilities on our consolidated balance sheets.
Deferred Commissions
19 unchanged sentences
We consider receivables past due based on the contractual payment terms.
−Removed: We reserve for specific amounts if collectability is no longer reasonably assured based on assessment of various factors including historical loss rates and expectations of forward-looking loss estimates.
+Added: We reserve for specific amounts if collectability is no longer reasonably assured based on an assessment of various factors including historical loss rates and expectations of forward-looking loss estimates.
Individual accounts receivable are written off when we become aware of a specific customer’s inability to meet its financial obligation, and all collection efforts are exhausted.
2 unchanged sentences
We classify investments in debt securities as available-for-sale at the time of purchase.
−Removed: All investments are recorded at estimated fair value and investments with original maturities of less than one year at time of purchase is classified as short-term.
+Added: All investments are recorded at estimated fair value, and investments with original maturities of less than one year at time of purchase are classified as short-term.
Unrealized gains and losses are included in accumulated other comprehensive income (loss), net of tax, a component of stockholders’ equity, except for credit-related impairment losses for available-for-sale debt securities.
For all our available-for-sale debt securities with unrealized loss positions we have determined it is more likely than not we will hold the securities until maturity or a recovery of the cost basis.
−Removed: Available-for-sale securities in an unrealized loss position are written down to its fair value with the corresponding charge recorded in other expense, net on our consolidated statement of comprehensive income, if it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, or we have the intention to sell the security.
+Added: Available-for-sale securities in an unrealized loss position are written down to its fair value with the corresponding charge recorded in other expense, net in our consolidated statements of comprehensive income, if it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, or we have the intention to sell the security.
Credit-related impairment losses, not to exceed the amount that fair value is less than the amortized cost basis, are recognized through an allowance for credit losses with changes in the allowance for credit losses recorded in other expense, net in the consolidated statements of comprehensive income.
4 unchanged sentences
Strategic investments consist of debt and non-marketable equity investments in privately held companies in which we do not have a controlling interest.
−Removed: We have elected to apply the measurement alternative for equity investments that do not have readily determinable fair values, measuring them at cost, less any impairment, plus or minus adjustments resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.
+Added: Privately held equity securities in which we do not have a controlling financial interest in but exercise significant influence over the investee are accounted for under equity method accounting.
+Added: These investments are measured at cost less any impairment, plus or minus our share of equity method investee income or loss.
+Added: For those privately held equity securities that do not have readily determinable fair values and for which we do not have a controlling financial interest or exercise significant influence, we have elected to apply the measurement alternative, measuring them at cost, less any impairment, plus or minus adjustments resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.
An impairment loss is recorded when an event or circumstance indicates a decline in value has occurred.
1 unchanged sentence
Derivative Financial Instruments
−Removed: We use derivative financial instruments, mainly foreign currency forward contracts with maturities of 12 months or less, to manage foreign currency risks.
−Removed: These derivative contracts are not designated as hedging instruments and changes in the fair value are recorded in other expense, net on the consolidated statements of comprehensive income.
+Added: Derivatives Designated as Hedging Instruments
+Added: We record derivatives at fair value as either assets or liabilities on our consolidated balance sheets.
+Added: For derivative contracts entered into to hedge a portion of our forecasted foreign currency denominated revenues that are designated and qualify as cash flow hedges, the unrealized gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and reclassified into earnings as subscription revenues when the hedged transaction affects earnings.
+Added: The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions.
+Added: We also formally assess, both at the inception of the hedge, and on an ongoing basis, whether each derivative is highly effective in offsetting changes in cash flows of the hedged item.
+Added: Fluctuations in the value of the derivative instruments are generally offset by changes in the hedged item;
+Added: however, if it is determined that a derivative is not highly effective as a hedge or if a derivative ceases to be a highly effective hedge, the Company will discontinue hedge accounting prospectively for the affected derivative.
+Added: Derivatives not Designated as Hedging Instruments
+Added: Derivative contracts not designated as hedging instruments consist of foreign currency forward contracts that we primarily use to hedge monetary assets and liabilities denominated in non-functional currencies.
+Added: These foreign currency forward contracts are recorded at fair value and have maturities of 12 months or less.
+Added: The changes in the fair value of these contracts are recorded in other expense, net on the consolidated statements of comprehensive income.
Outstanding foreign currency forward contracts are recorded at gross fair value as prepaid expenses and other current assets as well as accrued expenses and other current liabilities on the consolidated balance sheets.
−Removed: Realized gains (losses) from settlement of the derivative assets and liabilities are classified as investing activities in the consolidated statements of cash flows.
Property and Equipment, net
55 unchanged sentences
Credit risk arising from accounts receivable is mitigated to a certain extent due to our large number of customers and their dispersion across various industries and geographies.
−Removed: As of December 31, 2023 and 2022, there were no customers that represented more than 10% of our accounts receivable balance.
−Removed: There were no customers that individually exceeded 10% of our total revenues in any of the periods presented.
+Added: We had one customer, a U.S.
+Added: federal channel partner and systems integrator, that represented 12 % of our accounts receivable balance as of December 31, 2024 and 11 % of our total revenues for the year ended December 31, 2024.
+Added: Based on our periodic credit evaluations, there have been no historical collection concerns with this customer.
+Added: There were no customers that individually exceeded 10% of our accounts receivable balance as of December 31, 2023 or our total revenues for the year ended December 31, 2023.
For purposes of assessing concentration of credit risk and significant customers, a group of customers under common control or customers that are affiliates of each other are regarded as a single customer.
17 unchanged sentences
These reclassifications did not result in a restatement of prior period consolidated financial statements.
−Removed: Recently Issued Accounting Pronouncement Pending Adoption
−Removed: In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes - Improvements to Income Tax Disclosures” requiring enhancements and further transparency to certain income tax disclosures, most notably the tax rate reconciliation and income taxes paid.
−Removed: This ASU is effective for fiscal years beginning after December 15, 2024 on a prospective basis and retrospective application is permitted.
+Added: Revision of Prior Period Financial Statements
+Added: During the quarter ended June 30, 2024, the Company identified an immaterial error in the condensed consolidated statements of cash flows for the period ended March 31, 2024 relating to a misclassification between investing cash outflows and financing cash outflows.
+Added: The second installment payment for a business combination completed during the quarter ended September 30, 2023, totaling $ 184 million, was incorrectly classified as an investing cash outflow instead of a financing cash outflow.
+Added: The Company determined that the error was not material to any previously issued financial statements and will revise such error in its Quarterly Report on Form 10-Q for the three months ending March 31, 2025.
+Added: Recently Issued Accounting Pronouncement Adopted
+Added: In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280):
+Added: Improvements to Reportable Segment Disclosures,” which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.
+Added: We adopted this standard effective January 1, 2024 using a retrospective method.
+Added: For further information, refer to the Segments section in Note 2 “Summary of Significant Accounting Policies.”
+Added: Recently Issued Accounting Pronouncements Pending Adoption
+Added: In November 2024, the FASB issued ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures:
+Added: Disaggregation of Income Statement Expenses,” which requires disclosure of disaggregated information about specific categories underlying certain income statement expense line items in the footnotes to the financial statements for both annual and interim periods.
+Added: This ASU is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.
+Added: Early adoption is permitted.
We are currently evaluating the impact of the adoption of this standard.
+Added: In December 2023, the FASB issued ASU 2023-09, “Income Taxes - Improvements to Income Tax Disclosures,” which requires enhancement and further transparency to certain income tax disclosures, most notably the tax rate reconciliation and income taxes paid.
+Added: This ASU is effective for fiscal years beginning after December 15, 2024 on either a prospective or retrospective basis, with early adoption permitted.
+Added: We are currently evaluating the impact of the adoption of this standard.
(3) Investments
27 unchanged sentences
Total $ 7,569
−Removed: As of December 31, 2023 and 2022, the fair value of available-for-sale debt securities in a continuous unrealized loss position totaled $ 3,731 million and $ 4,232 million, respectively.
As of December 31, 2024, unrealized losses of $ 18 million from available-for-sale debt securities are from securities in a continuous unrealized loss position greater than 12 months.
+Added: As of December 31, 2024, the fair value of available-for-sale debt securities in a continuous unrealized loss position totaled $ 2,419 million, the majority of which has been in a continuous unrealized loss position for less than 12 months.
+Added: As of December 31, 2023, the fair value of available-for-sale debt securities in a continuous unrealized loss position totaled $ 3,731 million and unrealized losses of $ 26 million from available-for-sale debt securities are from securities in a continuous unrealized loss position greater than 12 months.
For all available-for-sale debt securities that were in unrealized loss positions, we have determined that it is more likely than not we will hold the securities until maturity or a recovery of the cost basis.
−Removed: Unrealized losses on available-for-sale debt securities were primarily due to changes in market interest rates, and credit-related impairment losses were not material as of December 31, 2023.
+Added: Unrealized losses on available-for-sale debt securities were due primarily to changes in market interest rates, and credit-related impairment losses were immaterial as of December 31, 2024.
Non-Marketable Equity Investments
As of December 31, 2024 and 2023, the total amount of non-marketable equity investments in privately held companies included in other assets on our consolidated balance sheets was $ 469 million and $ 268 million, respectively.
−Removed: These balances include a $ 100 million investment in the common and preferred shares of Celonis SE, a privately held company that develops and sells process mining software.
Our non-marketable equity investments are primarily accounted for using the measurement alternative, which measures the investments at cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes resulting from the issuance of similar or identical securities in an orderly transaction by the same issuer.
25 unchanged sentences
Corporate notes and bonds — 2 2
−Removed: Certificates of deposit — 2 2
Deposits 295 — 295
10 unchanged sentences
Our non-marketable equity investments are not included in the table above and are discussed in Note 3.
−Removed: See Note 8 for the fair value measurement of our derivative contracts and Note 11 for the fair value measurement of our long-term debt, which are also not included in the table above.
−Removed: Our marketable equity investments are classified within Level 1 and are immaterial as of December 31, 2023 and 2022.
+Added: Refer to Note 8 for the fair value measurement of our derivative contracts and Note 11 for the fair value measurement of our long-term debt, which are also not included in the table above.
+Added: Our marketable equity investments are classified within Level 1 and were immaterial as of December 31, 2024 and 2023.
(5) Business Combinations
2024 Business Combinations
+Added: During the year ended December 31, 2024, we completed certain acquisitions for total purchase consideration of $ 112 million primarily to enhance our products with the acquired technology and engineering workforce.
+Added: The acquisitions were not material to our consolidated financial statements, either individually or in the aggregate.
+Added: 2023 Business Combinations
On July 17, 2023, we acquired all outstanding shares of G2K Group GmbH, an artificial intelligence powered platform, for $ 465 million in a cash transaction.
−Removed: The consideration is paid in two installments.
−Removed: The first installment was made at the close of the transaction in July 2023.
−Removed: The second installment will be paid in February 2024 and is recognized as accrued expenses and other current liabilities, which is a non-cash financing activity as of December 31, 2023.
+Added: The consideration was paid in two installments, with the first payment made in July 2023 and the second payment made in February 2024.
The acquisition is intended to enhance our Now Platform with the acquired smart Internet of Things technology, enabling businesses to intelligently action digital and in-store data with enterprise-grade workflows.
−Removed: The purchase price was preliminarily allocated based on the estimated fair value of the developed technology intangible asset of $ 75 million ( six-year estimated useful life), net tangible liabilities of $ 1 million, deferred tax liabilities of $ 23 million and goodwill of $ 413 million, which is not deductible for income tax purposes.
+Added: The purchase price was allocated based on the fair value of the developed technology intangible asset of $ 75 million ( six-year estimated useful life), net tangible liabilities of $ 1 million, deferred tax liabilities of $ 23 million and goodwill of $ 414 million, which is not deductible for income tax purposes.
Goodwill is primarily attributed to the value expected from synergies resulting from the business combination.
The fair values assigned to tangible and intangible assets acquired, liabilities assumed and income taxes payable and deferred taxes are based on management’s estimates and assumptions.
−Removed: The provisional measurements of fair value for certain assets and liabilities, which encompass primarily deferred taxes and income taxes payable, may be subject to change as additional information is received.
−Removed: The Company expects to finalize the valuation as soon as practicable, but not later than one year from the acquisition date.
2022 Business Combinations
1 unchanged sentence
The acquisitions were not material to our consolidated financial statements, either individually or in the aggregate.
−Removed: 2021 Business Combinations
−Removed: On June 15, 2021, we acquired Lightstep, Inc., a leading observability solution provider, for $ 512 million in a cash transaction.
−Removed: The purchase price was allocated based on the estimated fair value of developed technology intangible asset of $ 85 million ( five-year estimated useful life), customer related and brand assets of $ 11 million, net tangible assets of $ 8 million, deferred tax liabilities of $ 6 million and goodwill of $ 413 million, which is not deductible for income tax purposes.
−Removed: On January 8, 2021, we acquired all outstanding stock of Element AI Inc., a leading enterprise artificial intelligence solution provider, for $ 228 million in an all-cash transaction.
−Removed: The purchase price was allocated based on the estimated fair value of developed technology intangible asset of $ 85 million ( five-year estimated useful life), net tangible assets of $ 16 million and goodwill of $ 81 million , which is partially deductible for income tax purposes.
−Removed: At time of acquisition, we established an unrecognized tax benefit of $ 43 million on pre-acquisition net operating loss carryforwards and other tax attributes which was subsequently released resulting in establishment of deferred tax asset based on completion of valuation and filing certain tax returns in the third quarter of 2021.
−Removed: Goodwill is primarily attributed to the value expected from synergies resulting from the business combinations.
−Removed: The fair values assigned to tangible and intangible assets acquired, liabilities assumed and income taxes payable and deferred taxes are based on management’s estimates and assumptions.
−Removed: The Company finalized the fair value measurements within one year from the acquisition date.
−Removed: During the year ended December 31, 2021, we also completed certain acquisitions for total purchase consideration of $ 66 million primarily to enhance our products with the acquired technology and engineering workforce.
−Removed: These acquisitions were not material to our consolidated financial statements, either individually or in the aggregate.
We have included the financial results of business combinations in the consolidated financial statements from the respective dates of acquisition, which were not material.
−Removed: Aggregate acquisition-related costs associated with business combinations are not material for each of the years ended December 31, 2023, 2022 and 2021, respectively, and are included in general and administrative expenses in our consolidated statements of comprehensive income as incurred.
+Added: Aggregate acquisition-related costs associated with business combinations were not material for each of the years ended December 31, 2024, 2023 and 2022, respectively, and were included in general and administrative expenses in our consolidated statements of comprehensive income as incurred.
(6) Goodwill and Intangible Assets
−Removed: The changes in the carrying amounts of g oodwill were as follows (in millions):
+Added: The changes in the carrying amounts of goodwill were as follows (in millions):
Carrying Amount
6 unchanged sentences
Balance as of December 31, 2024 $ 1,273
−Removed: Intangible assets consist of the following (in millions):
+Added: Intangible assets, net consists of the following (in millions):
December 31, 2024 December 31, 2023
8 unchanged sentences
Years Ending December 31,
−Removed: Thereafter 10
Total future amortization expense $ 209
12 unchanged sentences
(8) Derivative Contracts
−Removed: As of December 31, 2023 and 2022, we had foreign currency forward contracts with total notional values of $ 1,727 million and $ 1,360 million, respectively, which are not designated as hedging instruments.
−Removed: Our foreign currency forward contracts are classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments in active markets, such as currency spot and forward rates.
+Added: Derivatives Designated as Hedging Instruments
+Added: We entered into forward contracts to hedge a portion of our forecasted foreign currency denominated revenues during the year ended December 31, 2024.
+Added: These forward contracts are recorded at fair value and have maturities of up to 34 months.
+Added: As of December 31, 2024, we had outstanding cash flow hedges with total notional values of $ 1.7 billion.
+Added: We classify cash flows related to our cash flow hedges as operating activities in our consolidated statements of cash flows.
+Added: The total gross fair values of derivatives designated as hedging instruments recorded within the consolidated balance sheets were as follows (in millions):
+Added: December 31, 2024
+Added: Consolidated Balance Sheets Location
+Added: Prepaid expenses and other current assets
+Added: Accrued expenses and other current liabilities
+Added: Other long-term liabilities
+Added: As of December 31, 2024, approximately $ 54 million of the pre-tax derivative gains from accumulated other comprehensive income (loss) is expected to be recognized in subscription revenues within the next 12 months.
+Added: All hedging relationships are formally documented at the inception of the hedge and the hedges must be highly effective in offsetting changes to future cash flows on hedged transactions.
+Added: We evaluate hedge effectiveness at the inception of the hedge prospectively, and on an ongoing basis both retrospectively and prospectively.
+Added: We report changes in fair value of these cash flow hedges as a component of accumulated other comprehensive income (loss) and subsequently reclassify into earnings in the same period the forecasted transaction affects earnings.
+Added: Amounts reclassified to subscription revenues were a gain of $ 14 million for the year ended December 31, 2024.
+Added: There was no ineffectiveness in the Company’s cash flow hedging program for the year ended December 31, 2024.
+Added: Derivatives not Designated as Hedging Instruments
+Added: Our derivatives not designated as hedging instruments consist of foreign currency forward contracts that we primarily use to hedge monetary assets and liabilities denominated in non-functional currencies.
+Added: These foreign currency forward contracts are recorded at fair value and have maturities of 12 months or less.
+Added: The changes in the fair value of these contracts are recorded in other expense, net on the consolidated statements of comprehensive income.
+Added: As of December 31, 2024 and 2023, we had foreign currency forward contracts with total notional values of $ 2.2 billion and $ 1.7 billion, respectively, which were not designated as hedging instruments.
The gross fair value of these foreign currency forward contracts was immaterial as of December 31, 2024 and 2023.
−Removed: The gains (losses) recognized for these foreign currency forward contracts were immaterial for each of the years ended December 31, 2023, 2022 and 2021.
+Added: The gains (losses) recognized for foreign currency forward contracts from derivatives not designated as hedging instruments were immaterial for the years ended December 31, 2024, 2023 and 2022.
+Added: Realized gains (losses) from settlement of the derivative assets and liabilities are classified as investing activities in the consolidated statements of cash flows.
+Added: All foreign currency forward contracts, both designated and not designated as hedging instruments, are classified within Level 2 as the valuation inputs are based on quoted prices and market observable data of similar instruments in active markets, such as currency spot and forward rates.
(9) Deferred Revenue and Performance Obligations
−Removed: Revenues recognized during the year ended December 31, 2023 from amounts included in deferred revenue as of December 31, 2022 were $ 4.6 billion.
−Removed: Revenues recognized during the year ended December 31, 2022 from amounts included in deferred revenue as of December 31, 2021 were $ 3.7 billion.
+Added: Revenues recognized from beginning period deferred revenue during the years ended December 31, 2024 and 2023 were $ 5.7 billion and $ 4.6 billion, respectively.
Remaining Performance Obligations
11 unchanged sentences
For the periods ended December 31, 2024 and 2023, the carrying value of our outstanding debt was $ 1,489 million and $ 1,488 million, respectively, net of unamortized debt discount and issuance costs of $ 11 million and $ 12 million, respectively.
−Removed: We consider the fair value of the 2030 Notes as of December 31, 2023 and December 31, 2022 to be a Level 2 measurement.
−Removed: The estimated fair value of the 2030 Notes based on the closing trading price per $100, was $ 1,236 million and $ 1,144 million as of December 31, 2023 and December 31, 2022, respectively.
+Added: We consider the fair value of the 2030 Notes at December 31, 2024 and December 31, 2023 to be a Level 2 measurement.
+Added: The estimated fair value of the 2030 Notes based on the closing trading price per $100, was $ 1,247 million and $ 1,236 million at December 31, 2024 and December 31, 2023, respectively.
In August 2020, we issued 1.40 % fixed rate ten-year notes with an aggregate principal amount of $ 1.5 billion due on September 1, 2030 (the “2030 Notes”).
The 2030 Notes were issued at 99.63 % of principal and we incurred $ 13 million for debt issuance costs.
−Removed: The effective interest rate for the 2030 Notes was 1.53 % and included interest payable, amortization of debt issuance cost and amortization of the debt discount.
+Added: The effective interest rate for the 2030 Notes was 1.53 % and included interest payable, amortization of debt issuance cost and amortization of debt discount.
Interest is payable semi-annually in arrears on March 1 and September 1 of each year, beginning on March 1, 2021, and the entire outstanding principal amount is due at maturity on September 1, 2030.
2 unchanged sentences
In May and June 2017, we issued an aggregate of $ 782.5 million of 0 % convertible senior notes (the “2022 Notes”), which were converted prior to or settled on June 1, 2022, in accordance with their terms.
−Removed: Convertible Date Initial Conversion Price per Share Initial Conversion Rate per $1,000 Par Value Initial Number of Shares
−Removed: (in millions)
−Removed: 2022 Notes February 1, 2022 $ 134.75 7.42 shares 6
To minimize the impact of potential economic dilution upon conversion of the 2022 Notes, we entered into convertible note hedge transactions (the “2022 Note Hedge”) with certain investment banks to purchase 6 million shares for $ 128 million with respect to our common stock concurrently with the issuance of the 2022 Notes.
−Removed: The 2022 Note Hedge offsets the dilution and cash payments in excess of the principal amount of the converted 2022 Notes and expired upon the maturity date of the 2022 Notes, which was on June 1, 2022.
+Added: The 2022 Note Hedge expired upon the maturity date of the 2022 Notes, which was on June 1, 2022.
Separately, we entered into warrant transactions with certain investment banks, whereby we sold warrants to acquire 6 million shares of our common stock with aggregate proceeds of $ 54 million (the “2022 Warrants”).
−Removed: The 2022 Warrants were separate transactions and were not remeasured through earnings each reporting period.
The 2022 Warrants were not part of the 2022 Notes or 2022 Note Hedge.
−Removed: During the quarter ended June 30, 2022, we settled the remaining portion of the 2022 Warrants by delivering an aggregate of 0.6 million shares of our common stock.
−Removed: Accordingly, the 2022 Warrants were no longer outstanding as of June 30, 2022.
−Removed: (12) Accumulated Other Comprehensive Loss
−Removed: The following table shows the components of accumulated other comprehensive loss, net of tax, in the stockholders’ equity section of our consolidated balance sheets (in millions):
+Added: The 2022 Warrants were settled during the quarter ended June 30, 2022 and are no longer outstanding.
+Added: (12) Accumulated Other Comprehensive Income (Loss)
+Added: The following tables show the components of accumulated other comprehensive income (loss), net of tax, in the stockholders’ equity section of our consolidated balance sheets (in millions):
+Added: Unrealized Gains (Losses) on Derivative Instruments
+Added: Unrealized Gains (Losses) on Investments
Foreign Currency Translation Adjustment
−Removed: Net unrealized loss on investments ( 39 ) ( 77 )
−Removed: Accumulated other comprehensive loss $ ( 37 ) $ ( 102 )
−Removed: Reclassification adjustments out of accumulated other comprehensive loss into net income were not material for all periods presented.
+Added: Balance as of December 31, 2023
+Added: $ — $ ( 39 ) $ 2 $ ( 37 )
+Added: Other comprehensive income (loss) before reclassifications 64 12 ( 93 ) ( 17 )
+Added: Amounts reclassified from accumulated other comprehensive loss ( 14 ) — — ( 14 )
+Added: Net current period other comprehensive income (loss)
+Added: 50 12 ( 93 ) ( 31 )
+Added: Balance as of December 31, 2024
+Added: $ 50 $ ( 27 ) $ ( 91 ) $ ( 68 )
+Added: Unrealized Gains (Losses) on Derivative Instruments Unrealized Gains (Losses) on Investments
+Added: Foreign Currency Translation Adjustment
+Added: Balance as of December 31, 2022
+Added: $ — $ ( 77 ) $ ( 25 ) $ ( 102 )
+Added: Other comprehensive income (loss) before reclassifications
+Added: Amounts reclassified from accumulated other comprehensive loss
+Added: Net current period other comprehensive income (loss)
+Added: Balance as of December 31, 2023
+Added: $ — $ ( 39 ) $ 2 $ ( 37 )
(13) Stockholders' Equity
10 unchanged sentences
(2) Refer to Note 14 for a description of these plans.
−Removed: During each of the years ended December 31, 2023 and 2022, we issued a total of 2.7 million shares from stock option exercises, vesting of RSUs, net of employee payroll taxes and purchases from the employee stock purchase plan (“ESPP”).
+Added: During the years ended December 31, 2024 and 2023, we issued a total of 2.6 million and 2.7 million shares, respectively, from stock option exercises, vesting of RSUs, net of employee payroll taxes, and purchases from the employee stock purchase plan (“ESPP”).
Treasury Stock
In May 2023, our board of directors authorized a program to repurchase up to $ 1.5 billion of our common stock (the “Share Repurchase Program”).
−Removed: Under this new program, we may repurchase our common stock from time to time through open market purchases, in privately negotiated transactions, or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions.
+Added: Under the program, we may repurchase our common stock from time to time through open market purchases, in privately negotiated transactions, or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions.
The Share Repurchase Program does not have a fixed expiration date, may be suspended or discontinued at any time, and does not obligate us to acquire any amount of common stock.
1 unchanged sentence
During the year ended December 31, 2024, the Company repurchased 0.8 million shares of its common stock for $ 696 million.
+Added: During the year ended December 31, 2023, the Company repurchased 0.9 million shares of its common stock for $ 538 million.
All repurchases were made in open market transactions.
Repurchases of common stock are recognized as treasury stock and held for future issuance.
−Removed: As of December 31, 2023, $ 962 million of the originally authorized amount remained available for future repurchases.
+Added: As of December 31, 2024, $ 266 million of the originally authorized amount under the Share Repurchase Program remained available for future repurchases.
+Added: In January 2025, our board of directors authorized an additional $ 3.0 billion in repurchases under the Share Repurchase Program.
Preferred Stock
4 unchanged sentences
(14) Equity Awards
−Removed: We currently have three equity incentive plans:
+Added: We have three equity incentive plans:
2012 Equity Incentive Plan (the “2012 Plan”), amended and restated 2021 Equity Incentive Plan (the “2021 Plan”) and 2022 New-Hire Equity Incentive Plan (the “2022 Plan”).
32 unchanged sentences
The total fair value of shares vested was $ 98 million, $ 7 million and $ 11 million for the years ended December 31, 2024, 2023 and 2022, respectively.
−Removed: No stock options were granted during the year ended December 31, 2023.
−Removed: The weighted-average grant-date fair values of stock options granted was $ 273.63 and $ 248.85 per share for the years ended December 31, 2022 and 2021, respectively.
+Added: No stock options were granted during the years ended December 31, 2024 and December 31, 2023.
+Added: The weighted-average grant-date fair value of stock options granted was $ 273.63 per share for the year ended December 31, 2022.
During the year ended December 31, 2021, a one-time long-term performance-based option award was granted to the Chief Executive Officer (“2021 CEO Performance Award”) and to certain executives (collectively “2021 Performance Awards”) under the 2021 Plan at a total grant date fair value of $ 232 million.
The 2021 Performance Awards will vest in eight equal tranches based on service and achievement of both performance and market conditions, subject to continued employment and specifically for the 2021 CEO Performance Award, as CEO or Executive Chairman of the Company, through each vesting date.
−Removed: The performance and market condition for a particular tranche may be achieved at different points in time and in any order but will become eligible to vest only when all service, performance and market conditions for the respective tranche are met but no earlier than two years .
−Removed: The performance and market condition must be achieved by September 30, 2026 (the “Performance Period”).
+Added: The performance and market conditions for a particular tranche may be achieved at different points in time and in any order but will become eligible to vest only when all service, performance and market conditions for the respective tranche are met but no earlier than two years from date of grant.
+Added: The performance and market conditions must be achieved by September 30, 2026 (the “Performance Period”).
The stock price metric will be achieved when both the 180-day volume weighted-average price (“VWAP”) and the 30-day VWAP equal or exceed the respective tranche stock price metric on any day during the Performance Period.
1 unchanged sentence
Shares acquired upon exercise of the options cannot be sold, transferred or disposed until after the end of the Performance Period and the 2021 Performance Awards will expire ten years from the respective date of grant.
−Removed: As of December 31, 2023, none of the tranches have vested.
+Added: As of December 31, 2024, the first three tranches were vested based on achievement of both the performance and market conditions.
The fair value of the 2021 Performance Awards and the corresponding derived service periods were estimated using the Monte Carlo simulation.
−Removed: Stock-based compensation expense is recognized on a graded vesting basis over the requisite service period for each respective tranche, but not shorter than the two -year minimum service period, and includes an assessment of when it is probable the performance condition will be achieved, which involves a subjective assessment of our future financial projection.
+Added: Stock-based compensation expense is recognized on a graded vesting basis over the requisite service period for each respective tranche, but not shorter than the two-year minimum service period, and includes an assessment of when it is probable the performance condition will be achieved, which involves a subjective assessment of our future financial projections.
As of December 31, 2024, total unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested stock options was approximately $ 7 million.
−Removed: The weighted-average remaining vesting period of unvested stock options as of December 31, 2023 was one year .
+Added: The weighted-average remaining vesting period of unvested stock options as of December 31, 2024 was approximately one year .
A summary of RSU activity for the year ended December 31, 2024 was as follows:
11 unchanged sentences
The weighted-average grant-date fair value of RSUs granted was $ 791.14 , $ 479.18 and $ 541.24 per share for the years ended December 31, 2024, 2023 and 2022, respectively.
−Removed: For the years ended December 31, 2023, 2022, and 2021, PRSUs with service, performance and market vesting criteria are considered as eligible to vest when approved by the compensation committee of our board of directors in January of the year following the grant.
−Removed: The ultimate number of shares eligible to vest for PRSUs range from 0 % to 200 % of the target number of shares depending on achievement relative to the performance metrics and, for certain PRSUs, depend on our total shareholder return relative to that of the S&P 500 index over the applicable measurement period.
−Removed: The eligible shares subject to PRSUs granted during the year ended December 31, 2023 will vest in February of the following year and semi-annually for the remaining two years contingent on each holder’s continuous status as a service provider on the applicable vesting dates.
+Added: PRSUs have service, performance and market vesting conditions.
+Added: The ultimate number of shares eligible to vest range from 0 % to 200 %, subject to our board of directors compensation committee’s approval of performance metrics achievement and, for certain PRSUs, total shareholder return relative to that of the S&P 500 index.
+Added: The eligible shares subject to PRSUs granted during the year ended December 31, 2024 will vest in one to three years contingent on each holder’s continuous status as an employee on the applicable vesting dates.
The number of PRSUs granted included in the table above reflects the shares that could be eligible to vest at 100 % of target for PRSUs and includes adjustments for over or under achievement for PRSUs granted in the prior year.
2 unchanged sentences
Total stock-based compensation expense for the years ended December 31, 2024, 2023 and 2022 was $ 1,746 million, $ 1,604 million and $ 1,401 million, respectively.
−Removed: For the year ended December 31, 2023, we recorded $ 296 million of tax benefits on total stock-based compensation expense, which are reflected in the benefit from income taxes in the consolidated statements of comprehensive income.
−Removed: Tax benefits on stock-based compensation for the years ended December 31, 2022 and 2021 were no t material.
+Added: For the years ended December 31, 2024 and 2023, we recorded $ 340 million and $ 296 million, respectively, of tax benefits on total stock-based compensation expense, which are reflected in the provision for (benefit from) income taxes in the consolidated statements of comprehensive income.
+Added: Tax benefits on stock-based compensation for the year ended December 31, 2022 was immaterial .
Valuation Assumption s
7 unchanged sentences
Stock Options * * 2.04 %
−Removed: 1.20 % - 1.45 %
−Removed: 0.19 % - 0.20 %
+Added: PRSU 3.97 % - 4.56 %
Expected Term (in years)
4 unchanged sentences
Stock Options * * 40 %
−Removed: * There were no stock option grants in 2023.
+Added: PRSU 33 % - 42 %
+Added: * There were no stock option grants in 2024 and 2023.
Expected volatility .
12 unchanged sentences
Stock awards with performance or market conditions are included in dilutive shares to the extent all conditions are met.
−Removed: The dilutive potential shares of common stock are computed using the treasury stock method or the as-if converted method, as applicable.
+Added: The potentially dilutive shares of common stock are computed using the treasury stock method or the as-if converted method, as applicable.
The effects of outstanding stock options, RSUs, ESPP obligations, 2022 Notes and 2022 Warrants are excluded from the computation of diluted net income per share in periods in which the effect would be antidilutive.
6 unchanged sentences
Weighted-average effect of potentially dilutive securities:
−Removed: Common stock options 120 117 293
−Removed: RSUs 1,332 1,555 3,429
−Removed: ESPP Obligations
−Removed: 2022 Notes — — 535
+Added: Common stock options, RSUs and ESPP obligations
+Added: 2,589 1,454 1,672
2022 Notes settlements — — 280
−Removed: 2022 Warrants — — 649
Settlement of 2022 Warrants — — 153
4 unchanged sentences
711 3,191 4,658
−Removed: Table of Conten t s
−Removed: (16) (Benefit from) Provision for Income Taxes
+Added: (16) Provision for (Benefit from) Income Taxes
The components of income before income taxes by U.S.
5 unchanged sentences
Total $ 1,738 $ 1,008 $ 399
−Removed: The (benefit from) provision for income taxes consists of the following (in millions):
+Added: The provision for (benefit from) income taxes consists of the following (in millions):
Year Ended December 31,
9 unchanged sentences
98 ( 857 ) 15
−Removed: (Benefit from) provision for income taxes $ ( 723 ) $ 74 $ 19
+Added: Provision for (benefit from) income taxes $ 313 $ ( 723 ) $ 74
The effective income tax rate differs from the federal statutory income tax rate applied to the income before income taxes due to the following (in millions):
9 unchanged sentences
Tax credits ( 98 ) ( 93 ) ( 70 )
+Added: Other 12 15 7
Valuation allowance 25 ( 1,032 ) ( 100 )
−Removed: (Benefit from) provision for income taxes $ ( 723 ) $ 74 $ 19
−Removed: Table of Conten t s
+Added: Provision for (benefit from) income taxes $ 313 $ ( 723 ) $ 74
Significant components of our deferred tax assets are shown below (in millions).
12 unchanged sentences
Right of use asset ( 150 ) ( 165 )
+Added: Depreciation and amortization
+Added: ( 113 ) ( 90 )
Other ( 61 ) ( 41 )
Net deferred tax assets $ 1,339 $ 1,468
−Removed: The unremitted earnings of our foreign subsidiaries are not considered indefinitely reinvested, except in certain designated jurisdictions in which the resident entity is a service provider that is not expected to generate substantial amounts of cash in excess of what may be reinvested by the local entity.
−Removed: We have not provided for state income or withholding taxes on the undistributed earnings of foreign subsidiaries, which are considered indefinitely invested outside of the U.S.
−Removed: The amount of unrecognized deferred tax liability on these undistributed earnings is not material as of December 31, 2023.
+Added: As of December 31, 2024, we had no unremitted earnings when evaluating our outside basis difference relating to our U.S.
+Added: investment in foreign subsidiaries.
+Added: However, there could be local withholding taxes due to various foreign countries and/or U.S.
+Added: state taxes if certain lower tier earnings are distributed.
+Added: During 2024, a decision was made to change our indefinite reinvestment assertion such that we no longer permanently reinvest all foreign earnings.
+Added: Foreign withholding taxes after U.S.
+Added: foreign tax credit and/or state taxes that would be payable upon remittance of these lower tier earnings are currently estimated to be immaterial.
As of December 31, 2024, we had U.S.
−Removed: federal net operating loss and federal tax credit carryforwards of $ 470 million and $ 404 million, respectively.
+Added: federal net operating loss and federal tax credit carryforwards of $ 46 million and $ 376 million, respectively, as reported on our tax returns.
The federal tax credits will begin to expire in 2039 if not utilized.
−Removed: In addition, as of December 31, 2023, we had state net operating loss and state tax credit carryforwards of approximately $ 1.0 billion and $ 272 million, respectively.
+Added: In addition, as of December 31, 2024, we had state net operating loss and state tax credit carryforwards of approximately $ 0.8 billion and $ 313 million, respectively, as reported on our tax returns.
The state net operating loss will begin to expire in 2032 if not utilized.
−Removed: however, the tax-effected amount due to expire in 2024 is immaterial.
State tax credits and a portion of the federal net operating loss carryforwards can be carried forward indefinitely.
1 unchanged sentence
Such an annual limitation could result in the expiration of the net operating loss and tax credit carryforwards before utilization.
−Removed: As of December 31, 2023, we had Canada net operating loss and tax credit carryforwards of $ 170 million and $ 11 million, respectively.
+Added: As of December 31, 2024, we had Canada net operating loss and tax credit carryforwards of $ 150 million and $ 12 million, respectively, as reported on our tax returns.
The Canada net operating loss and tax credits will begin to expire in 2039 and 2037, respectively, if not utilized.
−Removed: In addition, as of December 31, 2023, we had United Kingdom net operating loss carryforwards of $ 145 million.
+Added: In addition, as of December 31, 2024, we had United Kingdom net operating loss carryforwards of $ 147 million, as reported on our tax returns.
The United Kingdom net operating loss can be carried forward indefinitely.
−Removed: Table of Conten t s
+Added: The increase in the 2024 valuation allowance of $ 24 million was primarily attributable to California tax credit generation.
+Added: The decrease in the 2023 valuation allowance of $ 1.03 billion was primarily attributable to the $ 1.05 billion release of certain U.S.
+Added: federal and state valuation allowances offset by approximately a $ 20 million increase in the California valuation allowance.
The income tax benefit was $ 723 million for the year ended December 31, 2023.
7 unchanged sentences
federal and state deferred tax assets will be realizable, with the exception of California.
−Removed: We continue to maintain a valuation allowance against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
−Removed: Of the $ 1.2 billion valuation allowance as of December 31, 2022, we released $ 1.05 billion of our valuation allowance during the year ended December 31, 2023.
−Removed: We maintained a valuation allowance of $ 196 million against our California deferred tax assets.
+Added: We released $ 1.05 billion of our valuation allowance during the year ended December 31, 2023.
+Added: As of December 31, 2024 and 2023, we maintained a valuation allowance of $ 220 million and $ 196 million, respectively, against our California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criteria, particularly as we expect research and development tax credit generation to exceed our ability to use the credits in future years.
We will continue to monitor the need for a valuation allowance against our deferred tax assets on a quarterly basis.
−Removed: The decrease in the 2023 valuation allowance of $ 1.03 billion was primarily attributable to the $ 1.05 billion release of certain U.S.
−Removed: federal and state valuation allowance offset by approximately a $ 20 million increase in the California valuation allowance.
The $ 98 million decrease in the 2022 valuation allowance was primarily attributable to a decrease in deferred tax assets related to the utilization of net operating losses.
−Removed: The $ 197 million increase in the 2021 valuation allowance was primarily attributable to an increase in deferred tax assets related to net operating losses and research and development tax credits partially offset by a valuation allowance release related to Lightstep, Inc.
−Removed: acquired deferred tax liabilities.
A reconciliation of the beginning and ending balance of total unrecognized tax benefits is as follows (in millions):
21 unchanged sentences
We periodically evaluate our exposures associated with our tax filing positions and believe that adequate amounts have been reserved for adjustments that may result from tax examinations.
−Removed: Table of Conten t s
(17) Commitments and Contingencies
2 unchanged sentences
Certain lease agreements include options to renew or terminate the lease, which are not reasonably certain to be exercised and therefore are not factored into our determination of lease payments.
−Removed: Total operating lease costs was $ 129 million, $ 112 million and $ 100 million, excluding short-term lease costs, variable lease costs and sublease income each of which were immaterial, for each of the years ended December 31, 2023, 2022 and 2021, respectively.
−Removed: Total cash paid for amounts included in the measurement of operating lease liabilities was $ 82 million and $ 75 million for the years ended December 31, 2023 and 2022, respectively.
−Removed: Operating lease liabilities arising from obtaining operating right-of-use assets was $ 130 million and $ 192 million for the years ended December 31, 2023 and 2022, respectively.
−Removed: As of December 31, 2023, the weighted-average remaining lease term is approximately nine years and the weighted-average discount rate is 3.8 %.
+Added: Total operating lease costs were $ 130 million, $ 129 million and $ 112 million for each of the years ended December 31, 2024, 2023 and 2022, respectively.
+Added: For the years ended December 31, 2024 and 2023, total cash paid for amounts included in the measurement of operating lease liabilities was $ 85 million and $ 82 million, respectively.
+Added: Operating lease liabilities arising from obtaining operating right-of-use assets totaled $ 84 million and $ 130 million for the years ended December 31, 2024 and 2023, respectively.
+Added: As of December 31, 2024, the weighted-average remaining lease term is approximately eight years , and the weighted-average discount rate is 4 %.
Maturities of operating lease liabilities as of December 31, 2024 are presented in the table below (in millions):
5 unchanged sentences
In addition to the amounts above, as of December 31, 2024, we have operating leases, primarily for offices, that have not yet commenced with undiscounted cash flows of $ 157 million.
−Removed: These operating leases are expected to commence between 2024 and 2025 with lease terms of three to ten years .
−Removed: Table of Conten t s
+Added: These operating leases are expected to commence in 2025 with lease terms of ten to eleven years .
Other Commitments
−Removed: Other commitments consist of data center and IT operations and sales and marketing activities related to our daily business operations.
+Added: Other contractual commitments primarily consist of data center and IT operations, cloud services and sales and marketing activities related to our daily business operations.
Future minimum payments under our non-cancellable purchase commitments as of December 31, 2024 are presented in the table below (in millions):
5 unchanged sentences
If we had canceled these contractual commitments as of December 31, 2024, we would have been obligated to pay cancellation penalties of approximately $ 56 million in aggregate.
−Removed: During 2022, we entered into a non-cancellable, $ 500 million agreement with Microsoft to purchase cloud services over five years , as we accelerate Azure adoption for mutual customers.
−Removed: The unutilized consumption is included within the table above.
+Added: We have entered into various non-cancellable agreements with cloud service providers, under which we have committed to spend an aggregate of $ 805 million through 2029 on cloud services.
+Added: In addition, we have entered into a non-cancellable agreement with an information technology equipment provider, under which we have committed to spend $ 1.9 billion through 2028 on capital expenditures to expand our data centers.
+Added: The unutilized amounts are included within the table above.
In addition to the amounts above, the repayment of our 2030 Notes with an aggregate principal amount of $ 1.5 billion is due on September 1, 2030.
6 unchanged sentences
(“Plaintiff”) filed a complaint against ServiceNow, Inc.
−Removed: District Court for the District of Delaware, alleging the Now Platform’s use of relational databases infringes three of Plaintiff’s patents.
−Removed: Plaintiff is seeking injunctive relief and unspecified damages.
−Removed: ServiceNow filed an answer denying Plaintiff’s allegations and asserts Plaintiff’s patents are, among other things, invalid, not infringed and otherwise unenforceable.
−Removed: A trial date has been set for October 7, 2024.
−Removed: While ServiceNow continues to vigorously defend this matter, we cannot predict the outcome with any degree of certainty.
−Removed: We also cannot provide an estimate of the possible loss or range of loss.
+Added: District Court for the District of Delaware, alleging the Now Platform’s use of relational databases infringes three of Plaintiff’s patents and seeking injunctive relief and unspecified damages.
+Added: The Company denied Plaintiff’s allegations and asserted Plaintiff’s patents were, among other things, invalid, not infringed and otherwise unenforceable.
+Added: In December 2024, the parties entered into a confidential settlement agreement resolving the matter for an immaterial amount.
Any adverse determination related to intellectual property claims or other litigation could prevent us from offering our services and adversely affect our financial condition and results of operations.
−Removed: For additional information regarding intellectual property litigation, see “Risk Factors—Lawsuits by third parties that allege we infringe their intellectual property rights could harm our business and operating results” and “Risk Factors—Our intellectual property protections may not provide us with a competitive advantage, and defending our intellectual property may result in substantial expenses that harm our operating results.”
+Added: For additional information regarding intellectual property litigation, see “Risk Factors—We may not be able to protect or enforce our intellectual property rights.”
+Added: As previously disclosed, through its internal processes, the Company received a complaint that raised potential compliance issues related to one of its government contracts.
+Added: The Company initiated an internal investigation, with the assistance of outside legal counsel, into the validity of these claims that concern the hiring of the Chief Information Officer of the U.S.
+Added: Army as the Company’s Head of Global Public Sector in March 2023.
+Added: As a result of the investigation, the Company’s board of directors determined that the Company’s President and Chief Operating Officer and the hired individual violated Company policy regarding a possible conflict relating to such individual’s hiring.
+Added: On July 24, 2024, the Company and its President and Chief Operating Officer came to a mutual agreement that he would resign from all positions
+Added: with the Company, effective immediately.
+Added: The other individual also has departed the Company.
+Added: The Company has informed the Department of Justice, the Department of Defense Office of Inspector General and the Army Suspension and Debarment Office of the investigation and is continuing to cooperate with the Department of Justice, which has commenced its own investigation into these matters.
+Added: The Company cannot predict the timing, outcome or possible impact of the investigation.
Indemnification Provisions
2 unchanged sentences
We have not incurred any costs as a result of such indemnification obligations and have not recorded any liabilities related to such obligations in the consolidated financial statements.
−Removed: Table of Conten t s
(18) Information about Geographic Areas and Products
10 unchanged sentences
North America (3)
+Added: $ 1,144 $ 871
Asia Pacific and other 191 175
2 unchanged sentences
(2) Europe, the Middle East and Africa (“EMEA”).
−Removed: (3) Property and equipment, net attributed to the United States were 79 % and 85 % of property and equipment, net attributable to North America as of December 31, 2023 and 2022, respectively.
+Added: (3) Property and equipment, net attributed to the United States were 79 % of property and equipment, net attributable to North America as of December 31, 2024 and 2023, respectively.
Subscription revenues consist of the following (in millions):
5 unchanged sentences
Our digital workflow products include most of our product offerings and are generally priced on a per user basis.
−Removed: Our remaining product offerings, primarily comprised of our ITOM products are predominantly priced on a subscription unit basis.
−Removed: Table of Conten t s
+Added: Our remaining product offerings, primarily comprised of our IT Operations Management (“ITOM”) products, are generally priced on a subscription unit basis.
+Added: (19) Subsequent Event
+Added: In January 2025, our board of directors authorized an additional $ 3.0 billion in repurchases under the Share Repurchase Program.
+Added: Refer to Note 13 “Stockholders’ Equity” for additional information about the Share Repurchase Program.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.