Qualys Q4 Earnings Surpass Expectations, Revenues Increase Y/Y

Qualys, Inc. QLYS ended 2025 on a strong note, reporting better-than-expected results for the fourth quarter of 2025. Both top and bottom lines also marked a significant year-over-year improvement.

Qualys came out with fourth-quarter 2025 earnings of $1.87 per share, beating the Zacks Consensus Estimate of $1.78 by 5.35%. Quarterly earnings also came above management’s guidance range of $1.73-$1.80 and increased 16.9% from the year-ago quarter’s earnings of $1.60.

Qualys’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 13.31%.

Qualys posted revenues of $175.3 million for the fourth quarter of 2025, surpassing the Zacks Consensus Estimate by 1.30%. The top line grew 10% from the year-ago quarter’s revenues of $159.2 million.

Qualys’ Q4 in Detail

During the fourth quarter, sales from channel partners surged 17%, outpacing the 4% sales growth recorded in direct selling. Channel partners contributed 51% to total revenues in the quarter, up from 48% a year ago, while direct selling accounted for the remaining 49%.

Geographically, U.S. sales grew 6% year over year, contributing approximately 56% to total revenues, while international sales rose 15% and accounted for 44%. Qualys’ net dollar expansion rate remained steady at 103%.

QLYS’ non-GAAP gross profit increased 12% year over year to $149 million, with the non-GAAP gross margin expanding to 85% compared with 84% in the year-ago quarter. Non-GAAP operating income rose 13% to $80.1 million, representing a margin of 46%, up from 44% a year earlier. The margin improvement highlights Qualys’ strong operating leverage despite higher investments in sales and marketing, which grew 16.7%.

Adjusted EBITDA rose 11% year over year to $82.6 million. Adjusted EBITDA margin of 47% remained flat on a year-over-year basis.

Qualys’ Balance Sheet & Cash Flow

Qualys ended the quarter with $696.8 million in cash, cash equivalents and marketable securities, up from $663.6 million in the previous quarter. The company generated operating cash flow of $75.7 million and free cash flow of $74.9 million in the fourth quarter. In full-year 2025, it generated operating cash flow and free cash flow of $309.4 million and $304.4 million, respectively.

Qualys repurchased 328,000 shares worth $44.7 million during the fourth quarter and has repurchased a cumulative 10.7 million shares valued at $1.2 billion since the program’s inception in February 2018. The company revealed that its board of directors has authorized another $200 million for the share repurchase program. This brought the total available authorization amount to $360.5 million.

Qualys Initiates Q1 & FY26 Guidance

Qualys initiated guidance for the first quarter and full-year 2026. The company expects revenues between $172.5 million and $174.5 million for the first quarter, indicating year-over-year growth of 8-9%. It projects non-GAAP earnings in the range of $1.76-$1.83. The Zacks Consensus Estimate for revenues and EPS is currently pegged at $173.6 million and $1.77, respectively.

For 2026, Qualys expects revenues between $717 million and $725 million, implying year-over-year growth in the range of 7-8%. The company forecasts non-GAAP earnings for 2026 to be in the band of $7.17-$7.45 per share. The Zacks Consensus Estimate for 2026 revenues and EPS is currently pegged at $717.9 million and $7.43, respectively.

Qualys’ Zacks Rank and Stocks to Consider

Currently, Qualys carries a Zacks Rank #3 (Hold).

Amphenol APH, Micron Technology MU and Analog Devices ADI are some better-ranked stocks that investors can consider in the Zacks Computer and Technology sector. Amphenol and Micron Technology sport a Zacks Rank #1 (Strong Buy) each at present, while Analog Devices carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Amphenol’s 2026 earnings has been revised downward by 7 cents over the past seven days to $4.32 per share, calling for an increase of 29.3% year over year. Amphenol shares have surged 81.2% over the past year.

The Zacks Consensus Estimate for Micron Technology’s fiscal 2026 earnings has moved northward by 14 cents in the past 30 days to $32.90 per share, implying 296.9% year-over-year growth. Micron Technology shares have soared 292% over the past year.

The Zacks Consensus Estimate for Analog Devices’ fiscal 2026 earnings has moved upward by 21 cents over the past 30 days to $9.97 per share, indicating a year-over-year increase of 28%. Analog Devices shares have rallied 54.2% over the past year.

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This article originally published on Zacks Investment Research (zacks.com).

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