ServiceNow price target raised to $1,150 from $1,075 at Needham

Needham raised the firm’s price target on ServiceNow (NOW) to $1,150 from $1,075 and keeps a Buy rating on the shares after hosting the company for a group investor meeting last week. The size of the calendar year 2025 Renewal cohort is larger than previous years, which is expected to pressure current remaining performance obligation growth through the first nine months of theyear until customers renew in Q4, with a potential upside catalyst to the renewal cycle as customers migrate to Xanadu which includes GenAI capabilities and the Pro Plus SKU, the analyst tells investors in a research note. Additionally, Needham says Pro Plus pricing seems to be tracking in line, if not ahead of management’s targeted ~30% uplift, and Subscription Gross Margin is likely to see pressure next year.