Bill McDermott
President and Chief Executive Officer at ServiceNow
Thank you, Lisa, and good afternoon, everyone. Welcome to our Q2 earnings call. Our team delivered an outstanding quarter, significantly exceeding the high end of our guidance across all metrics. Subscription revenues were up 31%. Subscription billings were up 30%. Operating margin was 25%. And the number of deals greater than $1 million was 51, up 28% year-over-year. Free cash flow for the first half of the year was up 34% year-over-year. An incredible performance by our team, an exceptional first half and we have unstoppable momentum. And we reflected this in our strong full year guidance raise across the board.
Gina will review the details with you in a few moments. The global economy is recovering at the fastest pace in 80 years. The enterprise digital transformation market is expected to grow nearly 3 times faster than GDP in 2021. Business leaders worldwide are facing do-or-die moments. Business models have changed forever. The pandemic has accelerated the digital imperative. We are in a leading position to capitalize on this unprecedented tailwind. We are giving customers the innovative solutions they need to solve the greatest challenges of our time. The world's biggest challenges are ServiceNow's biggest opportunities: from vaccine management, to ESG, to the new world of hybrid work. Whatever the challenge, work flows with ServiceNow. We've created a new market, one that respects the billions and billions of dollars of investment that customers have put into their systems of record.
We make those investments work for today's digital business demands. The Now Platform, the platform of platforms, delivers workflow automation with a consumer-grade user experience that inspires our customers, enabling siloed systems across an enterprise to work together, creating more efficient, more productive ways to get work done. ServiceNow is the control tower for digital transformation for every business, in every industry, serving every persona. The power of the Now Platform makes this possible with one data model, one architecture and one platform to workflow a better world. For example, a premium German auto manufacturer faces huge logistical challenges in maintaining on-target production. Every 30 million parts are processed daily and are dispatched to more than 4,000 supplier locations to production centers in Europe and Mexico. To manage the complexity, ServiceNow provides a single connected supply chain technology platform. ServiceNow analyzes 300,000 data points per month, optimizing the performance of each aspect of the value chain. This is just one example of the power of the Now Platform. I'd like to share an overview of our success across ServiceNow's portfolio.
Let's begin with our IT workflows. We are the standard for optimizing all IT services and operations. Our core IT workflows remained very strong. ITSM was in 16 of our top 20 deals, with 14 deals over $1 million. ITOM was in 15 of our top 20 deals, with six deals over $1 million. Our AI-powered Service Operations is resonating big time with customers. We saw great wins with leading companies, including Travelers and Walgreens Boots Alliance and more. They're working with ServiceNow to support their digital transformation of their enterprises. And we're honored that Maritime and Port Authority of Singapore is working with ServiceNow to accelerate its digital transformation efforts as it looks to make Singapore a leading global port and international maritime center. MPA will leverage the Now Platform to drive automation and to improve productivity and employee experience. With Employee Workflows, we make work better by driving outstanding employee experiences that enhance productivity for employees anytime, anywhere while also developing company loyalty, which is particularly important in this environment.
The Now Platform provides employees the system of action for key events, including onboarding, parental leave, moving and many more moments that matter for people. Employee Workflows were in 13 of our top 20 deals, with six deals over $1 million. Asahi, for example, is focused on expanding growth while reinforcing ESG initiatives that support sustainable value creation. They chose the Now Platform to improve the employee experience by providing a single point of contact for employees to improve productivity. They wanted service catalogs so they could standardize HR processes, and they wanted integrations to connect all their siloed workflows. With Customer Workflows, we're creating a new service paradigm by delivering connected experiences that redefine customer operations for greater speed, agility, transparency and convenience, all while working with existing systems. Customer Workflows were in 10 of our top 20 deals, with four deals over $1 million. We now have over 2,000 customers running customer service management. Deutsche Telekom is leveraging ServiceNow's telecommunication solution to streamline order management to become the leading B2B telco provider. The Now Platform will be at the heart of the order management process, enabling a 360-degree view of orders, inventory and infrastructure, creating a seamless, connected experience for DT's employees and customers.
With Creator Workflows, we're accelerating software development across the entire enterprise by giving everyone the low-code tools to quickly create applications and beautiful experiences. IDC predicts that more than 500 million apps will be developed by 2023. This is equivalent to the total number of apps that were developed in the past 40 years. For example, Airbus built an innovative tracking application in less than three months using ServiceNow's low-code app engine. Now Airbus employees can scan barcodes of any piece of factory equipment to see the relevant information they need in real time. Manufacturing transportation incidents have dropped 20%. In Q2, Creator Workflows were in 18 of our top 20 deals. Nokia picked ServiceNow's Creator Workflows to develop custom apps in significantly less time at a fraction of the cost of alternative platforms. These examples show how the combined capabilities of the workflows on the Now Platform are better together.
They deliver even more value than the sum of their parts. Our introduction of the Now Buying Program has helped customers realize those synergies more quickly by simplifying the buying process, providing greater usage flexibility, all while improving business impact. Continuing to build a strong client and alliance ecosystem, we established an enterprise agreement through the Now Buying Program with Deloitte who will take advantage of our full product suite to facilitate great experiences for their employees and clients while enhancing efficiencies and compliance management for the business. Also in our partner ecosystem, we recently announced our integration with Microsoft Windows 365. This will enable users to easily access cloud PCs directly through Microsoft Teams regardless of the employees' location in the hybrid work environment. In closing, I am incredibly proud of our team's passion for solving the world's greatest challenges. Our engineering team is second to none.
Our go-to-market organization is the best in the business, and our purpose to make work better for people is resonating. It's been an honor to help turn vaccines into vaccinations for millions and millions of people. It's a privilege to help the world reopen and safely return to the workplace. We are engaging leaders on how we can solve society's biggest problems, improve the lives of people and help deliver better services to citizens everywhere. We are better than we were yesterday, not as good as we'll be tomorrow. This is a special company with unbridled energy and unprecedented opportunity. We are well on our way to becoming the defining enterprise software company in the 21st century. And I look forward to taking your questions. But first, I'll turn it over to our Chief Financial Officer, Gina. Gina, over to you.