Citigroup Outlook ServiceNow (NOW.US) Q1 performance: Optimistic with hidden concerns, target price lowered to $177.

ServiceNow (NOW.US) will announce first-quarter earnings on April 22nd. Citigroup Inc. stated that the company's performance may slightly exceed expectations as early signs of consumer spending have begun to show. Citigroup analyst Tyler Radke maintained a "buy" rating for ServiceNow but lowered the target price from $237 to $177. Analysts generally expect ServiceNow to report earnings per share of $0.97 and revenue of $3.75 billion. Radke wrote in a report to clients, "Our first-quarter partner surveys show that the majority of partners are performing slightly above expectations, but we also note some delays in deals, and federal government demand remains soft. CIO survey data indicates adjustments to IT budgets, mainly constrained by clear return on investment and governance mechanisms, in which ServiceNow continues to excel. A meeting with Chief Product Officer Amit Zavery last month indicated that the artificial intelligence lab is directly adopting the workflows managed by ServiceNow, further strengthening ServiceNow's competitive advantage. We expect performance to slightly exceed expectations and to continue moderately into fiscal year 2026. While revenue expectations for fiscal year 2026 remain unchanged, as the growth potential in the coming years still depends on the early stages of artificial intelligence applications, we have lowered revenue and profit expectations for fiscal years 2027-2028 by 50-200 basis points."