ServiceNow’s first-quarter results offer subscription operators a useful read on enterprise software budgets right now. In results released April 22, the company reported Q1 subscription revenue of $3.671 billion, up 22% year over year, on total revenue of $3.770 billion, and raised its full-year 2026 subscription revenue outlook to $15.735 billion to $15.775 billion.

The bigger signal for operators is that ServiceNow’s core recurring revenue indicators still showed solid demand. The company reported current remaining performance obligations (cRPO) of $12.64 billion, up 22.5% year over year, and remaining performance obligations (RPO) of $27.7 billion. It also said it closed 16 transactions over $5 million in net new annual contract value in the quarter and ended Q1 with 630 customers above that threshold.

The quarter also offered stronger evidence that AI-related revenue is moving beyond early experimentation. ServiceNow said customers spending more than $1 million in annual contract value on Now Assist grew more than 130% year over year. Reuters also reported that CEO Bill McDermott said the company had not faced pressure to cut prices on its core products, even as customers increased spending on AI solutions.

ServiceNow said delayed closings on several large Middle East deals reduced quarterly subscription revenue growth by about three-quarters of a percentage point. Reuters reported those were large government deals that the company still expects to close throughout the year. ServiceNow also said its updated outlook includes contribution from Armis, which it acquired on April 20. But those details look more like context than the core takeaway from the quarter. Taken together, the quarter suggests enterprise buyers are still willing to fund software they see as essential.

INSIDER TAKE

For subscription operators, the message here is that spending still appears to be concentrating around platforms buyers see as operationally central. ServiceNow’s higher subscription outlook, strong cRPO growth, and continued large-deal activity all support that view.

The AI signal is also getting more concrete. Growth in Now Assist customers spending more than $1 million annually suggests that at least some AI demand is turning into meaningful recurring revenue.