Q2 2026 Qualys Inc Earnings Call Transcript
Key Points
- Qualys Inc (QLYS) delivered strong Q2 2026 results with revenue growth of 11% to $182.2 million, beating expectations and raising full-year revenue guidance to $732-$738 million.
- The company's AI-native Risk Operations Center (ROC) and new innovations like InstaScan and Agent Insta are gaining traction, enabling customers to detect and remediate vulnerabilities in minutes rather than weeks.
- Net dollar expansion rate improved to 105% in Q2, up from 104% in the prior quarter, driven by strong upsell execution and adoption of ETM and patch management solutions.
- Channel partner revenue grew 22% year-over-year, now representing 54% of total revenue, reflecting successful partner-led growth strategy.
- The company reported strong profitability with adjusted EBITDA margin of 46% and free cash flow margin of 31%, while also raising full-year EPS guidance to $7.74-$7.88.
- QFlex, the flexible enterprise licensing model, is gaining traction and played a direct role in significant upsells, including a low seven-figure deal with a Global 300 customer.
- International revenue grew 15% year-over-year, outpacing domestic growth of 8%, indicating strong global demand for Qualys' solutions.
- The company's guidance assumes a net dollar expansion rate remains at current levels, with only moderate growth contribution from new business in 2026, suggesting limited acceleration in the near term.
- The departure of the CISO and General Manager of the ETM business creates leadership transition risk, though the company has appointed internal and external replacements.
- Direct revenue remained largely unchanged year-over-year, indicating a reliance on channel partners for growth and potential challenges in direct sales execution.
- The company expects second-half current billings growth of only 7-8%, which is below the strong Q2 performance, reflecting caution about sales cycle acceleration for the broader customer base.
- Operating expenses increased 8% in Q2, with sales and marketing expenses growing 14%, which could pressure margins if revenue growth does not keep pace.
- The ETM/CSAM combined contribution to new bookings remained flat at 14% sequentially, suggesting that the adoption of these key products is not accelerating as quickly as hoped.
- The company noted that the post-Mythos environment is still in early stages, with most customer conversations focused on pipeline building rather than immediate spending, indicating potential delays in revenue realization.
Ladies and gentlemen, thank you for standing by. Welcome to Qualys's second quarter 2026 investor call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during this session, you would need to press *11 on your telephone. You will. Hear an automated message about when your hand is raised and to withdraw your question, please press *11 again. Please be advised that today's conference is being recorded.
I would like now to turn the conference over to Blair King, Investor Relations. Please go ahead.
Thank you, Michelle. Good afternoon, and welcome to Qualys' second-quarter 2026 earnings call.
Joining me today to discuss our results are Sumantha Carr, our President and CEO and Jumi Kim, our CFO.
Before we get started, I would like to remind you that our remarks today will include forward-looking statements that generally relate to product capabilities, future events or future financial or
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