12:07 PM EST, 01/30/2025 (MT Newswires) -- ServiceNow ( NOW ) posted "solid" Q4 results driven by growth in subscription revenue with operating margin exceeding estimates but the results fell short of high investor expectations, Oppenheimer said in a note Thursday.

The company's AI segment demonstrated traction as deals for the Now Assist product grew over 150% quarter-over-quarter while it secured 19 net new annual contract value deals above $5 million in Q4, according to the note.

The firm said that ServiceNow ( NOW ) issued 2025 revenue guidance below consensus expectations, primarily due to a $175 million foreign exchange headwind and a shift to a consumption-based pricing model for its Agentic AI. The company said late Wednesday it expects full-year subscription revenue of $12.64 billion to $12.68 billion, equating to year-over-year growth of 18.5% to 19%.

The new pricing model is expected to increase customer adoption but may reduce short-term subscription revenue and result in a slower-than-expected increase in net new $1 million-plus annual contract value customers, Oppenheimer added.

The brokerage raised the price target on ServiceNow's ( NOW ) stock to 1,200 from $1,150 while keeping an outperform rating on the stock.

Shares were over 12% lower in recent trading.

Price: 998.21, Change: -145.43, Percent Change: -12.72