ServiceNow's Earnings Surge: Key Price Levels to Watch Amid AI-Driven Momentum

The recent surge in ServiceNow (NOW) stock, fueled by robust Q1 2025 results and an upbeat outlook, has investors eyeing critical technical levels. With subscription revenues surging 19% year-over-year to $3.005 billion and current remaining performance obligations (cRPO) hitting $10.31 billion—a 22% YoY jump—the enterprise software giant is positioning itself as a leader in the AI transformation era. Yet, as shares climb toward resistance zones, traders must remain vigilant to price action at key thresholds.

The Financial Catalyst: AI and Customer Growth

ServiceNow’s Q1 results underscore its strategic shift toward AI-driven workflows, with its “Agentic AI” platform capturing market attention. The launch of preconfigured AI agents for industries like telecom and CRM, along with acquisitions of Moveworks and Logik.ai, signals a relentless focus on automating enterprise processes. This is reflected in customer metrics: the company now has 508 customers with over $5 million in annual contract value (ACV), a 20% YoY increase, with average ACV rising to $14.2 million.

Non-GAAP free cash flow hit $1.48 billion, a 48% YoY jump, while guidance for 2025 projects subscription revenue of $12.64–12.68 billion, implying 18.5%–19% growth. CEO Bill McDermott emphasized ServiceNow’s role as the “AI platform for business transformation,” a narrative investors are rewarding with a post-earnings stock surge.

Technical Analysis: Support and Resistance in Focus

The stock’s post-earnings rally—jumping over 10% to $898 in after-hours trading—has set the stage for near-term technical battles. Key levels to watch include:

1. $807–$814 Support Zone: A drop below $807 could signal a retest of April lows (~$676), but this range has historically acted as a rebound catalyst.
2. $900 Resistance: A breakout here would target $1,000, with the 200-day SMA (~$923) posing a major hurdle.
3. $1,160 Ceiling: A double-top pattern from early 2025 looms as the ultimate resistance, with sustained momentum needed to overcome it.

Bulls vs. Bears: Indicators and Risks

Bullish Case:
- The descending channel breakout (late January) remains intact, with RSI at 42.87 suggesting upward room.
- Strong cRPO growth and AI partnerships (e.g., NVIDIA, Google Cloud) reinforce long-term demand.

Bearish Considerations:
- The MACD line remains below its signal line, signaling bearish momentum.
- Geopolitical risks (e.g., U.S. procurement delays) and a 9.8% YTD decline highlight volatility.
- The 200-day SMA (~$923) has historically limited gains.

Conclusion: A Strategic Balance

ServiceNow’s fundamentals—19% revenue growth, $10.31B cRPO, and 98% customer retention—support its valuation. However, traders must balance optimism with caution. A sustained close above $900 would validate bullish momentum toward $1,000, while a retreat below $807 could reignite selling pressure.

The company’s AI-driven differentiation and partnerships position it to capitalize on a $30 billion revenue target by 2026. Yet, the path to $1,160 resistance will hinge on navigating macro risks and technical headwinds. For now, ServiceNow’s stock remains a bellwether for enterprise software’s AI transition—but watch those levels closely.

Data as of April 24, 2025. Past performance does not guarantee future results.