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Qualys Stock Soars 8% as Q2 Earnings and Revenues Beat Estimates
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Key Takeaways
QLYS reported Q2 EPS of $1.68 and revenues of $164.1M, both beating consensus estimates.
Channel partner sales rose 17% in Q2, now accounting for 49% of total revenues versus 51% from direct sales.
QLYS raised 2025 EPS guidance to $6.20-$6.50 and revenue forecast to $656M-$662M on strong Q2 results.
Qualys, Inc. (QLYS - Free Report) shares gained 8.3% during Tuesday’s extended trading session after the company reported better-than-expected results for the second quarter of 2025. It reported second-quarter non-GAAP earnings of $1.68 per share, which surpassed the Zacks Consensus Estimate of $1.47 and came above management’s guidance range of $1.40-$1.50.
The bottom line also witnessed a significant improvement from the year-ago quarter’s earnings of $1.52. The robust year-over-year growth was primarily driven by higher revenues and lower diluted shares outstanding, partially offset by increased expenses and taxes.
Qualys’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 16.1%.
QLYS’ second-quarter revenues increased 10% year over year to $164.1 million and outpaced the Zacks Consensus Estimate of $161.2 million. The year-over-year jump in the top line was achieved by leveraging the partner ecosystem.
During the second quarter, sales from channel partners increased 17%, outpacing the 4% sales growth registered in direct selling. Revenue contribution mix from channel partners was 49% in the second quarter, while direct selling accounted for the remaining 51%.
Geography-wise, sales in the United States grew 7% year over year and contributed approximately 57% to total second-quarter revenues. Accounting for the remaining 43% of second-quarter revenues, international sales increased 15%.
Qualys’ net dollar expansion rate on a constant-currency basis for the second quarter was 104%, up from the previous quarter’s 103%.
QLYS’ non-GAAP gross profit increased 10% year over year to $137.8 million, while the non-GAAP gross margin remained flat at 84% in the second quarter. Non-GAAP operating income grew 6% to $70.1 million, while the non-GAAP operating margin contracted 100 basis points to 43%. The lower operating margin reflects increased investment in sales & marketing and research & development activities.
Adjusted EBITDA for the second quarter rose 5% to $73.4 million, while the adjusted EBITDA margin declined to 45% from 47% in the year-ago quarter.
Qualys’ Balance Sheet & Cash Flow
Qualys ended the quarter with cash and cash equivalents and marketable securities of approximately $621 million, down from $640 million in the year-ago quarter. The company generated operating cash flow of $33.8 million and free cash flow of $32.4 million during the second quarter. In the first half of 2025, it generated operating and free cash flows of $143.4 million and $140 million, respectively.
Qualys repurchased stocks worth $49.2 million during the second quarter and $89.5 million in the first half of 2025. As of June 30, 2025, it has $254.6 million remaining under the ongoing share repurchase program.
Qualys Updates Guidance
Buoyed by stronger-than-expected second-quarter performance, Qualys raised guidance for full-year 2025. It now expects revenues between $656 million and $662 million, up from the earlier range of $648-$657 million. The updated guidance range implies a year-over-year improvement of 8-9%. The Zacks Consensus Estimate for 2025 revenues is currently pegged at $652.2 million.
Qualys now forecasts non-GAAP earnings for 2025 to be in the range of $6.20-$6.50 per share, up from the previous range of $6.00-$6.30. The consensus mark for the bottom line is pinned at $6.17.
Qualys also initiated guidance for the third quarter. The company expects revenues between $164.5 million and $167.5 million for the third quarter, indicating year-over-year growth of 7%-9%. It projects non-GAAP earnings in the range of $1.50-$1.60. The Zacks Consensus Estimate for revenues and EPS is currently pegged at $163.1 million and $1.49, respectively.
The Zacks Consensus Estimate for Arista Networks’ 2025 earnings has been revised upward by a penny to $2.58 per share over the past 30 days and suggests a year-over-year increase of 13.7%. Arista Networks shares have risen 6.9% year to date.
The Zacks Consensus Estimate for Bumble’s 2025 earnings has been revised upward by a penny to $1.05 per share in the past 30 days, implying a strong improvement from the loss of $4.61 reported in 2024. Bumble shares have declined 7.3% year to date.
The Zacks Consensus Estimate for MongoDB’s fiscal 2026 earnings has been revised upward by 4 cents to $3.07 per share in the past 60 days, calling for a 16.1% year-over-year decline. MongoDB shares have fallen 2% year to date.
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Qualys Stock Soars 8% as Q2 Earnings and Revenues Beat Estimates
Key Takeaways
Qualys, Inc. (QLYS - Free Report) shares gained 8.3% during Tuesday’s extended trading session after the company reported better-than-expected results for the second quarter of 2025. It reported second-quarter non-GAAP earnings of $1.68 per share, which surpassed the Zacks Consensus Estimate of $1.47 and came above management’s guidance range of $1.40-$1.50.
The bottom line also witnessed a significant improvement from the year-ago quarter’s earnings of $1.52. The robust year-over-year growth was primarily driven by higher revenues and lower diluted shares outstanding, partially offset by increased expenses and taxes.
Qualys’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 16.1%.
QLYS’ second-quarter revenues increased 10% year over year to $164.1 million and outpaced the Zacks Consensus Estimate of $161.2 million. The year-over-year jump in the top line was achieved by leveraging the partner ecosystem.
Qualys, Inc. Price, Consensus and EPS Surprise
Qualys, Inc. price-consensus-eps-surprise-chart | Qualys, Inc. Quote
Qualys’ Q2 in Detail
During the second quarter, sales from channel partners increased 17%, outpacing the 4% sales growth registered in direct selling. Revenue contribution mix from channel partners was 49% in the second quarter, while direct selling accounted for the remaining 51%.
Geography-wise, sales in the United States grew 7% year over year and contributed approximately 57% to total second-quarter revenues. Accounting for the remaining 43% of second-quarter revenues, international sales increased 15%.
Qualys’ net dollar expansion rate on a constant-currency basis for the second quarter was 104%, up from the previous quarter’s 103%.
QLYS’ non-GAAP gross profit increased 10% year over year to $137.8 million, while the non-GAAP gross margin remained flat at 84% in the second quarter. Non-GAAP operating income grew 6% to $70.1 million, while the non-GAAP operating margin contracted 100 basis points to 43%. The lower operating margin reflects increased investment in sales & marketing and research & development activities.
Adjusted EBITDA for the second quarter rose 5% to $73.4 million, while the adjusted EBITDA margin declined to 45% from 47% in the year-ago quarter.
Qualys’ Balance Sheet & Cash Flow
Qualys ended the quarter with cash and cash equivalents and marketable securities of approximately $621 million, down from $640 million in the year-ago quarter. The company generated operating cash flow of $33.8 million and free cash flow of $32.4 million during the second quarter. In the first half of 2025, it generated operating and free cash flows of $143.4 million and $140 million, respectively.
Qualys repurchased stocks worth $49.2 million during the second quarter and $89.5 million in the first half of 2025. As of June 30, 2025, it has $254.6 million remaining under the ongoing share repurchase program.
Qualys Updates Guidance
Buoyed by stronger-than-expected second-quarter performance, Qualys raised guidance for full-year 2025. It now expects revenues between $656 million and $662 million, up from the earlier range of $648-$657 million. The updated guidance range implies a year-over-year improvement of 8-9%. The Zacks Consensus Estimate for 2025 revenues is currently pegged at $652.2 million.
Qualys now forecasts non-GAAP earnings for 2025 to be in the range of $6.20-$6.50 per share, up from the previous range of $6.00-$6.30. The consensus mark for the bottom line is pinned at $6.17.
Qualys also initiated guidance for the third quarter. The company expects revenues between $164.5 million and $167.5 million for the third quarter, indicating year-over-year growth of 7%-9%. It projects non-GAAP earnings in the range of $1.50-$1.60. The Zacks Consensus Estimate for revenues and EPS is currently pegged at $163.1 million and $1.49, respectively.
Qualys’ Zacks Rank & Stocks to Consider
Currently, QLYS carries a Zacks Rank #3 (Hold).
Some better-ranked stocks that investors can consider in the broader Zacks Computer and Technology sector are Arista Networks (ANET - Free Report) , Bumble (BMBL - Free Report) and MongoDB (MDB - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Arista Networks’ 2025 earnings has been revised upward by a penny to $2.58 per share over the past 30 days and suggests a year-over-year increase of 13.7%. Arista Networks shares have risen 6.9% year to date.
The Zacks Consensus Estimate for Bumble’s 2025 earnings has been revised upward by a penny to $1.05 per share in the past 30 days, implying a strong improvement from the loss of $4.61 reported in 2024. Bumble shares have declined 7.3% year to date.
The Zacks Consensus Estimate for MongoDB’s fiscal 2026 earnings has been revised upward by 4 cents to $3.07 per share in the past 60 days, calling for a 16.1% year-over-year decline. MongoDB shares have fallen 2% year to date.