Net Income Per Share

Basic net income per share attributable to common stockholders is computed by dividing net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period, adjusted for the effects of dilutive shares of common stock, which are comprised of outstanding stock options, RSUs and ESPP obligations. Stock awards with performance or market conditions are included in dilutive shares to the extent all conditions are met. The potentially dilutive shares of common stock are computed using the treasury stock method or the as-if converted method, as applicable. The effects of outstanding stock options, RSUs and ESPP obligations are excluded from the computation of diluted net income per share in periods in which the effect would be antidilutive.

The following table presents the calculation of basic and diluted net income per share attributable to common stockholders, as adjusted to give effect to the Stock Split (in millions, except for number of shares reflected in thousands and per share data):


	Year Ended December 31,
	2025		2024			2023
Numerator:
Net income	$	1,748		$	1,425		$	1,731
Denominator:
Weighted-average shares outstanding - basic	1,036,740			1,029,169			1,020,685
Weighted-average effect of potentially dilutive securities:



Common stock options, RSUs and ESPP obligations	9,951			12,944			7,268


Weighted-average shares outstanding - diluted	1,046,691			1,042,113			1,027,953
Net income per share - basic	$	1.69		$	1.38		$	1.70
Net income per share - diluted	$	1.67		$	1.37		$	1.68
Common stock options, RSUs and ESPP obligations excluded from diluted net income per share because their effect would have been anti-dilutive	10,787			3,555			15,955

About Earnings Per Share Disclosures

The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.

Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.

ServiceNow, Inc. Earnings Per Share Disclosure

About Earnings Per Share Disclosures

Other Available Disclosures