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Q2 Holdings (QTWO)
NYSE:QTWO
Earnings Data
Report Date
May 05, 2026After Close (Confirmed)
Period Ending
2026 (Q1)Consensus EPS Forecast
0.69Last Year’s EPS
0.54Same Quarter Last Year
Strong Buy
Based on 11 Analysts Ratings
Earnings Call Summary
Earnings Call Sentiment|Positive
The call was broadly positive: the company delivered strong 2025 results with double-digit revenue and subscription growth, meaningful adjusted EBITDA and margin expansion, robust free cash flow and conversion, large-bookings momentum (including significant Tier 1 wins), and a clear long-term profitability framework. Key challenges include higher revenue churn driven by M&A activity, a weaker and shrinking non-subscription revenue base that is margin-dilutive, some sequential cost pressure from R&D and migration expenses, a cash balance decline tied to debt retirement and buybacks, and guidance that signals a moderate deceleration in growth beyond 2025. On balance, financial and operational execution and a strong pipeline outweigh the near-term headwinds.Company Guidance
Strong Subscription Revenue Growth
Q4 subscription revenue grew 16% year-over-year; full year subscription revenue grew 17% and represented 82% of total revenue, supporting higher-margin mix and recurring revenue stability.
Revenue Growth and Record Annual Performance
Total revenue was $208.2M in Q4 (up 14% YoY, +3% sequential) and full year revenue was $794.8M (up 14% YoY), the highest annual growth rate since 2021.
Robust ARR and Backlog Expansion
Total ARR reached $921M (up 12% YoY) and subscription ARR grew to $780M (up 14% YoY). Ending backlog was $2.7B, up 7% sequentially and 21% year-over-year.
Record Adjusted EBITDA and Margin Expansion
Full year adjusted EBITDA was $186.5M (up 49% YoY from $125.3M) with adjusted EBITDA margins expanding by approximately 550 basis points year-over-year; Q4 adjusted EBITDA was a record $51.2M (up 36% YoY).
Strong Free Cash Flow and Conversion
Generated meaningful free cash flow: Q4 free cash flow ~$57M and full year free cash flow $173M, representing a 93% free cash flow conversion rate as a percentage of adjusted EBITDA (exceeding the 90% target).
Bookings Momentum and Large Deal Wins
Q4 was the company's second-largest bookings quarter (following a record Q3); full year included 26 Tier 1/enterprise deals with eight in Q4, including major wins (Tier 1 relationship pricing/commercial digital banking, a $40B digital banking customer expansion, a Helix top-five credit union deal, and the largest fraud deal in company history with a $200B bank).
Commercial and Transaction Volume Growth
Commercial processed over $4.0T in transactions in 2025, representing 21% YoY growth; December was the first month to exceed $400B in transaction volume, highlighting commercial traction.
Risk & Fraud Product Strength and Cross-Sell
Risk and fraud emerged as one of the fastest-growing product lines, performing strongly as both stand-alone and cross-sold solutions and contributing materially to upmarket success and expansions.
Gross Margin Improvement and Cloud Migration Progress
Q4 gross margin was 58.6% (up from 57.4% YoY); full year gross margin was 58% (up ~200 bps YoY). They completed customer cloud migration in January 2026 and expect >60% gross margins in 2026 with further cloud-related cost benefits thereafter.
2026 Guidance and Long-Term Financial Framework
Provided 2026 guidance: FY revenue $871M–$878M (~10% YoY growth), raising subscription revenue growth outlook to at least 14%; full-year adjusted EBITDA guidance $225M–$230M (~26% of revenue). Introduced longer-term targets (by 2030: non-GAAP gross margins ≥65% and adjusted EBITDA margins ≥35%).
QTWO Earnings History
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat
Missed
QTWO Earnings-Related Price Changes
Report Date | Price 1 Day Before | Price 1 Day After | Percentage Change |
|---|---|---|---|
Feb 11, 2026 | $56.62 | $52.45 | -7.36% |
Nov 05, 2025 | $61.12 | $70.17 | +14.81% |
Jul 30, 2025 | $89.99 | $81.20 | -9.77% |
May 07, 2025 | $80.31 | $90.79 | +13.05% |
Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.
FAQ
When does Q2 Holdings (QTWO) report earnings?
Q2 Holdings (QTWO) is schdueled to report earning on May 05, 2026, After Close (Confirmed).
What is Q2 Holdings (QTWO) earnings time?
Q2 Holdings (QTWO) earnings time is at May 05, 2026, After Close (Confirmed).
Where can I see when companies are reporting earnings?
You can see which companies are reporting today on our designated earnings calendar.
What companies are reporting earnings today?
You can see a list of the companies which are reporting today on TipRanks earnings calendar.
What is QTWO EPS forecast?
QTWO EPS forecast for the fiscal quarter 2026 (Q1) is 0.69.