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ServiceNow Gets New Leadership as of End-of-Year 2019

ServiceNow announced a change in leadership that will happen by end-of-year 2019.

John Donahoe will be leaving by year end, replaced by Bill McDermott as President and CEO. Donahoe departs ServiceNow to become the new chief executive of Nike, although he will remain on the ServiceNow Board of Directors until June 2020, when his term expires.

Bill McDermott is the former CEO of SAP, taking over the leadership role after Léo Apotheker’s departure in 2010. McDermott is perceived as having “rescued” SAP during a difficult period for the company.

Interestingly, share prices of ServiceNow dropped as much as 15% on the news of the change of leadership, although it is not clear whether the downturn was due to news of Donahoe’s departure or of McDermott’s arrival. Share prices recovered slightly after ServiceNow reported Q3 2019 results the day after.

Our Take

A change in leadership is always interesting to watch, particularly with a company such as ServiceNow and its tremendous growth numbers – Q3 2019 numbers reflected an annual growth of 33%. A change in leadership often heralds a change in company direction, be it pricing, licensing terms, entering new markets, or adjusting R&D spend.We will be keeping watch and will report as it happens.

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