Workflow automation software company ServiceNow Inc. once again surpassed Wall Street’s earnings expectations as it clinched 28 new customer deals worth more than $1 million.

The company, which makes software that automates enterprises’ information technology, reported a second-quarter net loss of $52.7 million, or 30 cents per share, down a bit from a year ago, on $631.1 million in revenue, up more than 41 percent. Earnings before certain costs such as stock compensation came in at 49 cents per share.

The performance was enough to beat Wall Street’s forecasts, with analysts looking for earnings before certain costs such as stock compensation of 43 cents per share on revenue of $618.4 million.

The company’s share price, which had dipped slightly in Wednesday’s regular session on an up day for the overall market, crept up 1 percent in after-hours trading.

R “Ray” Wang, principal analyst, founder and chairman of Constellation Research Inc., told SiliconANGLE the essentially flat share price wasn’t a big problem as “investors pretty much have priced in their reduction in net income losses and overall increase in sales and marketing and R&D cost increases.”

Meanwhile, ServiceNow executives were keen to highlight the successes this quarter:  “Subscription revenues grew 45 percent year-over-year,” Michael Scarpelli, ServiceNow’s chief financial officer said in a conference call, citing “continued strength from our entire product portfolio.”

The company also appears to be doing well in its efforts to cross-sell into new markets, with Chief Executive John Donahoe (pictured) saying its benefited from its customer’s digital transformation implementations. He added the company now has 575 customers on annual contracts of more than $1 million.

“Digital transformation is no longer just a business buzzword,” Donahoe said. “It’s fast becoming a business priority worldwide. We are becoming a strategic partner of choice to help enable the digital future.”

Donahoe discussed the company’s digital transformation efforts during an interview on theCUBE, SiliconANGLE’s mobile livestreaming studio unit, at its Knowledge conference in May:

Wang told SiliconANGLE that ServiceNow’s real challenge now i to create new products and services that can take it to the next level. “The real question is whether they can offer new products in HR and CXM fast enough to create new categories that could take them to over $1 billion in valuation before the war with Workday and Salesforce intensifies,” he said.

During the quarter, ServiceNow acquired an artificial intelligence startup, Parlo, focused on natural language processing. The company said it plans to integrate Parlo’s technology, called Broca, into its Now Platform to help with business process automation. That should enable better understanding of conversational language, thereby helping to speed up interactions between humans and machines.

ServiceNow’s guidance for the next quarter was disappointing, even if investors didn’t seem to mind much. The company said it expects subscription revenue of $610 million to $615 million for the next quarter, a little under Wall Street’s estimate of $621 million. Officials added that they expect subscription billings of $648 million to $653 million, versus Wall Street’s forecast $674 billion.

Image: SiliconANGLE