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Qualys (QLYS)
NASDAQ:QLYS
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Qualys (QLYS) AI Stock Analysis

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QLYS

Qualys

(NASDAQ:QLYS)

Rating:74Outperform
Price Target:
$150.00
▲(12.13% Upside)
Qualys' strong financial performance and strategic growth initiatives are key strengths, supported by robust revenue growth and profitability. However, technical indicators suggest neutral momentum, and valuation metrics indicate moderate attractiveness. Macroeconomic challenges and increased expenses are notable risks.
Positive Factors
Federal Opportunities
FedRAMP High status opens the door to both civilian and defense agencies, providing a multi-year growth lever that complements commercial ROC wins.
Pricing Strategy
The company's new flexible pricing model allows customers to dynamically shift spend, leading to faster expansion and easier upsell even in constrained budget environments.
Revenue Growth
Qualys' channel-sourced revenue is growing rapidly, indicating successful expansion and increased value in bundling services and software.
Negative Factors
Billings Growth
Despite efforts, management anticipates a modest Billings growth of 5%-7% in the second half of the year.
Competitive Pressure
Rivalry is intensifying in QLYS's competitive domain.
Deferred Revenue
Deferred revenue declined sequentially, reflecting prior challenges in go-to-market efforts.

Qualys (QLYS) vs. SPDR S&P 500 ETF (SPY)

Qualys Business Overview & Revenue Model

Company DescriptionQualys (QLYS) is a leading provider of cloud-based security and compliance solutions that help organizations manage their IT security posture. Founded in 1999, the company operates in the cybersecurity sector, offering a comprehensive suite of products designed for vulnerability management, policy compliance, and web application security. Qualys' core services leverage its cloud platform to deliver real-time visibility into security vulnerabilities across various IT assets, enabling businesses to proactively identify and mitigate risks.
How the Company Makes MoneyQualys generates revenue primarily through a subscription-based model, offering its services on a Software-as-a-Service (SaaS) basis. Customers subscribe to various modules of Qualys' platform, which include solutions for vulnerability management, continuous monitoring, and compliance. The company typically has multi-year contracts with its clients, providing a steady stream of recurring revenue. Key revenue streams include fees from new subscriptions, renewals of existing contracts, and upselling additional services or features to existing customers. Qualys also benefits from strategic partnerships with other technology providers and integrators, enhancing its market reach and service capabilities, which contribute positively to its earnings.

Qualys Key Performance Indicators (KPIs)

Any
Any
Customers Over $500,000 in Annual Revenue
Customers Over $500,000 in Annual Revenue
Tracks the number of high-value customers contributing significant revenue, indicating the company's success in securing and maintaining large accounts.
Chart InsightsQualys has consistently grown its customer base spending over $500,000 annually, reaching 212 by mid-2025. This growth aligns with strategic wins, including deals with a global fintech and a federal agency, and the launch of its Agentic AI platform. Despite macroeconomic challenges, the company's focus on AI and risk management solutions is driving customer expansion. The improved net dollar expansion rate and increased channel contributions highlight effective upselling and partner strategies, positioning Qualys for continued growth in a competitive cybersecurity market.
Data provided by:Main Street Data

Qualys Earnings Call Summary

Earnings Call Date:Aug 05, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 29, 2025
Earnings Call Sentiment Neutral
The earnings call presents a balanced view with strong revenue growth, notable customer wins, and strategic product launches like the Agentic AI platform. However, the macroeconomic challenges and increased operating expenses present concerns. The introduction of Agentic AI and FedRAMP High authorization could drive future growth, but economic uncertainties and increased expenses are notable challenges.
Q2-2025 Updates
Positive Updates
Solid Revenue Growth
Revenues grew 10% to $164.1 million, driven by strong performance from channel partners, which grew by 17%.
Introduction of Agentic AI Platform
Launch of a fully reimagined Agentic AI platform that allows CISOs to augment their team with specialized autonomous AI agents, improving remediation times, accuracy, and cost savings.
Federal Sector Opportunity
Qualys received FedRAMP High authorization, positioning it as the only platform offering a comprehensive suite of security solutions for federal, state, and local agencies.
Strong Customer Wins
A global fintech company and a large federal government agency both chose Qualys for significant cybersecurity projects, demonstrating trust in Qualys' comprehensive cybersecurity solutions.
Negative Updates
Macroeconomic Challenges
There is ongoing macroeconomic uncertainty affecting deal scrutiny and new business growth, which is expected to continue through 2025.
Lower Free Cash Flow Margin
Free cash flow was $32.4 million, representing a 20% margin compared to 33% in the prior year due to fluctuations in working capital.
R&D and Operating Expenses Increase
Operating expenses increased by 15%, driven by investments in sales and marketing and R&D, impacting profitability margins.
Company Guidance
During Qualys' Second Quarter 2025 Earnings Call, the company provided guidance indicating strong performance and strategic growth initiatives. For fiscal year 2025, revenue is expected to range between $656 million and $662 million, reflecting an 8% to 9% growth increase. The third quarter revenue guidance is projected between $164.5 million and $167.5 million, marking a 7% to 9% year-over-year growth. Adjusted EBITDA for Q2 was $73.4 million, representing a 45% margin, with full-year EBITDA margins anticipated in the low to mid-40s. The company's net dollar expansion rate improved to 104% from 103% last quarter. Operating expenses are expected to increase by 15% to 17% as Qualys invests in sales, marketing, and R&D. EPS guidance for the full year has been revised to a range of $6.2 to $6.5, an uplift from the previous forecast. Qualys also announced a new flexible pricing model, which should enhance customer adoption and loyalty by allowing them access to the entire platform through Qualys units (QLUs).

Qualys Financial Statement Overview

Summary
Qualys demonstrates strong financial health with consistent revenue growth, high profitability, and a solid balance sheet. The company maintains a low debt-to-equity ratio and impressive return on equity. However, the recent decline in free cash flow growth is a concern that warrants monitoring.
Income Statement
85
Very Positive
Qualys has demonstrated consistent revenue growth with a TTM revenue growth rate of 2.41%, following a steady upward trend over the past years. The company maintains strong profitability with a gross profit margin of 81.80% and a net profit margin of 29.18% in TTM. EBIT and EBITDA margins are also robust at 31.93% and 34.02%, respectively, indicating efficient operations and cost management.
Balance Sheet
80
Positive
The balance sheet reflects a strong financial position with a low debt-to-equity ratio of 0.10, suggesting conservative leverage. Return on equity is impressive at 39.19%, indicating effective use of equity capital. The equity ratio stands at 50.83%, highlighting a solid equity base relative to total assets.
Cash Flow
75
Positive
Operating cash flow remains strong, with a TTM operating cash flow to net income ratio of 1.36, indicating robust cash generation relative to net income. However, the free cash flow growth rate has declined by 6.39% in TTM, which could be a concern if the trend continues. The free cash flow to net income ratio is healthy at 0.95, suggesting good cash conversion.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue637.02M607.57M554.46M489.72M411.17M362.96M
Gross Profit521.35M496.09M446.97M386.94M321.73M283.74M
EBITDA214.18M205.71M190.06M168.32M125.29M134.89M
Net Income185.00M173.68M151.59M107.99M70.96M91.57M
Balance Sheet
Total Assets999.50M973.54M812.62M700.94M814.56M736.82M
Cash, Cash Equivalents and Short-Term Investments370.03M381.42M425.56M321.33M405.29M356.02M
Total Debt55.35M47.22M28.74M42.18M48.52M57.37M
Total Liabilities491.34M496.42M444.44M411.81M377.85M332.34M
Stockholders Equity508.17M477.12M368.17M289.13M436.71M404.48M
Cash Flow
Free Cash Flow239.50M231.76M235.82M174.87M174.96M150.05M
Operating Cash Flow252.12M244.09M244.60M198.85M200.62M180.09M
Investing Cash Flow-160.93M-71.43M-73.17M145.07M-29.53M-80.93M
Financing Cash Flow-178.42M-145.65M-141.49M-306.03M-107.89M-112.58M

Qualys Technical Analysis

Technical Analysis Sentiment
Negative
Last Price133.77
Price Trends
50DMA
136.69
Negative
100DMA
134.62
Negative
200DMA
136.86
Negative
Market Momentum
MACD
-0.29
Negative
RSI
50.24
Neutral
STOCH
75.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For QLYS, the sentiment is Negative. The current price of 133.77 is above the 20-day moving average (MA) of 131.52, below the 50-day MA of 136.69, and below the 200-day MA of 136.86, indicating a neutral trend. The MACD of -0.29 indicates Negative momentum. The RSI at 50.24 is Neutral, neither overbought nor oversold. The STOCH value of 75.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for QLYS.

Qualys Risk Analysis

Qualys disclosed 49 risk factors in its most recent earnings report. Qualys reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Qualys Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$4.90B26.6539.53%9.69%9.50%
72
Outperform
$6.61B-25.73%14.29%-14.42%
71
Outperform
$1.23B26.254.72%-2.32%7.70%
65
Neutral
$6.27B-27.34%25.39%-42.90%
63
Neutral
$3.74B-12.60%11.41%33.76%
61
Neutral
$35.45B8.20-10.60%1.91%8.56%-9.51%
52
Neutral
$1.34B48.29155.46%4.67%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
QLYS
Qualys
133.77
9.91
8.00%
VRNT
Verint Systems
20.36
-9.51
-31.84%
VRNS
Varonis Systems
56.84
1.79
3.25%
RPD
Rapid7
20.17
-16.54
-45.06%
TENB
Tenable Holdings
30.49
-9.40
-23.56%
S
SentinelOne
17.70
-5.41
-23.41%

Qualys Corporate Events

Executive/Board ChangesShareholder Meetings
Qualys Annual Meeting Approves Key Amendments
Neutral
Jun 16, 2025

On June 11, 2025, Qualys held its Annual Meeting where approximately 91.70% of the shares were represented. During the meeting, stockholders elected Class I directors, ratified the appointment of Grant Thornton LLP as the independent registered public accounting firm, approved executive compensation, and sanctioned an amendment to the company’s certificate of incorporation to permit the exculpation of certain officers.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 03, 2025