Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at ServiceNow (NYSE: NOW) and the best and worst performers in the automation software industry.

The whole purpose of software is to automate tasks to increase productivity. Today, innovative new software techniques, often involving AI and machine learning, are finally allowing automation that has graduated from simple one- or two-step workflows to more complex processes integral to enterprises. The result is surging demand for modern automation software.

The 7 automation software stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 8.4% while next quarter’s revenue guidance was in line.

Luckily, automation software stocks have performed well with share prices up 15.4% on average since the latest earnings results.

ServiceNow (NYSE: NOW)

Built on a single code base that processes over 4 billion workflow transactions daily, ServiceNow (NYSE: NOW) provides a cloud-based platform that helps organizations automate and digitize workflows across departments, from IT and HR to customer service and security.

ServiceNow reported revenues of $3.22 billion, up 22.4% year on year. This print exceeded analysts’ expectations by 2.9%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ billings and EBITDA estimates.

“ServiceNow’s outstanding second quarter results continue our long track record of elite level execution,” said ServiceNow Chairman and CEO Bill McDermott.

ServiceNow delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 1.9% since reporting and currently trades at $937.82.

We think ServiceNow is a good business, but is it a buy today? Read our full report here, it’s free.

Best Q2: SoundHound AI (NASDAQ: SOUN)

Born from the idea that machines should understand human speech as naturally as people do, SoundHound AI (NASDAQ: SOUN) develops voice recognition and conversational intelligence technology that enables businesses to integrate voice assistants into their products and services.

SoundHound AI reported revenues of $42.68 million, up 217% year on year, outperforming analysts’ expectations by 31.2%. The business had an incredible quarter with an impressive beat of analysts’ billings estimates and a solid beat of analysts’ EBITDA estimates.

SoundHound AI delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 38.1% since reporting. It currently trades at $14.85.

Is now the time to buy SoundHound AI? Access our full analysis of the earnings results here, it’s free.

Slowest Q2: UiPath (NYSE: PATH)

Starting with robotic process automation (RPA) and evolving into a comprehensive automation powerhouse, UiPath (NYSE: PATH) provides an AI-powered business automation platform that enables organizations to create software robots that mimic human actions to streamline repetitive tasks and processes.

UiPath reported revenues of $361.7 million, up 14.4% year on year, exceeding analysts’ expectations by 4.1%. It was a satisfactory quarter as it also posted an impressive beat of analysts’ EBITDA estimates but a significant miss of analysts’ billings estimates.

Interestingly, the stock is up 9.9% since the results and currently trades at $11.89.

Read our full analysis of UiPath’s results here.

Microsoft (NASDAQ: MSFT)

Originally named "Micro-soft" for microcomputer software when founded in 1975, Microsoft (NASDAQ: MSFT) is a global technology company that develops software, cloud services, devices, and AI solutions for consumers, businesses, and organizations worldwide.

Microsoft reported revenues of $76.44 billion, up 18.1% year on year. This print surpassed analysts’ expectations by 3.5%. Overall, it was an exceptional quarter as it also logged a narrow beat of analysts’ revenue estimates, as Personal Computing, Intelligent Cloud, and Business Services all beat and an impressive beat of analysts’ operating income estimates.

The stock is down 3% since reporting and currently trades at $498.46.

Read our full, actionable report on Microsoft here, it’s free.

Pegasystems (NASDAQ: PEGA)

With a "Center-out Business Architecture" approach that transcends organizational silos, Pegasystems (NASDAQ: PEGA) develops software that helps organizations automate workflows and use artificial intelligence to improve customer experiences and business processes.

Pegasystems reported revenues of $384.5 million, up 9.5% year on year. This result beat analysts’ expectations by 5.9%. It was a strong quarter as it also produced an impressive beat of analysts’ EBITDA estimates.

Pegasystems had the slowest revenue growth among its peers. The stock is up 11% since reporting and currently trades at $56.56.

Read our full, actionable report on Pegasystems here, it’s free.

Market Update

As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.

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