Q2 2026 Q2 Holdings Inc Earnings Call Transcript
Key Points
- Q2 Holdings Inc (QTWO) delivered another strong quarter with revenue of $219.8 million, up 13% year-over-year, and record adjusted EBITDA of $62.8 million, exceeding guidance.
- The company secured eight Tier 1 and enterprise wins in the quarter, demonstrating strong demand across digital banking, risk and fraud, and relationship pricing.
- Subscription ARR grew 15% year-over-year to $826 million, driven by new customer wins and expansions, with full-year subscription revenue growth guidance raised to approximately 14.5%.
- New AI products like Q2 Assistant, Q2 Code, and account takeover fraud solutions received strong customer interest, with double-digit early adopters for the fraud product.
- The company retired its convertible notes, ending the quarter debt-free, and announced a $350 million increase in share repurchase authorization, reflecting confidence in long-term value.
- Total ARR growth of 13% remains below subscription ARR growth due to ongoing pressure in non-subscription revenue, particularly discretionary professional services.
- Non-subscription revenue was roughly flat year-over-year, with growth in transactional revenue offset by declines in discretionary services, a trend expected to continue.
- Operating expenses increased year-over-year, driven by higher R&D costs for product and AI investments, which could pressure margins if not managed.
- The company faces tough comparisons in the second half of 2026, which may moderate subscription ARR growth and require strong execution to meet guidance.
- AI product revenue contribution is still early-stage, with general availability expected in Q4 2026, and the financial impact remains uncertain until further quarters of data.
Good afternoon. My name is Kevin, and I will be your conference operator today. At this time, I would like to welcome everyone to the Q2 Holdings second quarter 2026 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question, please raise your hand. If you have dialed into today's call, please press star nine to raise your hand and star six to unmute when called upon. I will now hand the conference over to Josh Yankovic, investor relations. Sir, please begin.
Thank you, operator. Good afternoon, everyone, and thank you for joining us today. With me on the call are Matt Flake, our CEO and Jonathan Price, our CFO.
This call contains forward-looking statements that are subject to significant risks and uncertainties, including, among other things, with respect to our expectations for the future operating and financial performance of Q2 holdings and for
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