ServiceNow Australia revenue jumps 17% as losses narrow

ServiceNow Australia reported double-digit revenue growth in 2025, driven by rising subscription income across its software operations in Australia and New Zealand. However, the business remained in a net loss position, largely due to employee and share-based compensation costs.

The company generated revenue of AUD $819.8 million in the year ended 31 December 2025, up from AUD $703.4 million in 2024, representing growth of about 17%. The business operates as a distributor of ServiceNow products and services across Australia and New Zealand.

The company's loss after tax narrowed slightly to AUD $42.0 million from AUD $42.1 million a year earlier. Loss before tax improved to AUD $32.5 million from AUD $33.2 million.

Revenue mix

Subscription services remained the dominant source of income.

Revenue from subscriptions rose to AUD $725.6 million in 2024, up from AUD $619.8 million. Service fee revenue increased to AUD $63.0 million from AUD $53.4 million. Professional services and other revenue edged up to AUD $31.3 million from AUD $30.2 million.

The revenue growth reflects continued expansion in customer demand for subscription-based software services, which accounted for almost 89% of total revenue during the year.

Cost pressures

Expenses also increased during the year.

Employee benefit expenses rose to AUD $328.0 million from AUD $288.8 million. Share-based compensation expense remained substantial at AUD $62.0 million, broadly unchanged from the previous year. Distributor fees increased to AUD $367.4 million from AUD $311.1 million. Web hosting and other services costs climbed to AUD $22.1 million from AUD $18.3 million.

Business development spending increased to AUD $15.8 million from AUD $10.9 million, while depreciation and amortisation expenses rose to AUD $32.3 million from AUD $27.0 million.

Directors said the 2025 result was mainly affected by the accounting treatment of share-based compensation linked to stock plans operated by the group's ultimate parent company.

Cash generation

Despite reporting a net loss, the company continued to generate positive operating cash flow.

Cash generated from operations reached AUD $93.0 million, while net cash generated from operating activities totalled AUD $84.4 million after tax payments. This compares with AUD $107.0 million in net operating cash flow during 2024.

Investing activities used AUD $77.3 million, including AUD $48.0 million spent on property and equipment and a net increase in loans to related parties of AUD $40.1 million.

Balance sheet

Trade receivables increased to AUD $108.0 million from AUD $87.1 million, reflecting higher business volumes. Deferred revenue, a key indicator of contracted future revenue, rose to AUD $465.4 million from AUD $425.9 million.

The company also expanded its investment in technology infrastructure and equipment. The carrying value of property and equipment increased to AUD $109.4 million from AUD $86.4 million following additions and transfers totalling nearly AUD $49.6 million during the year.

Loans to related parties increased to AUD $367.2 million from AUD $329.0 million under the group's treasury and cash pooling arrangements.

Outlook indicators

While the company remained loss-making on a statutory basis, rising subscription revenue, higher deferred revenue balances and continued positive operating cash flow indicate ongoing growth in underlying business activity.

No dividends were paid or declared during the year, and no dividend was recommended after the reporting period.