Qualys is a technology company specializing in cloud-based cybersecurity and compliance solutions, with a significant presence in the software infrastructure industry. Its scalable platform enables organizations to identify, assess, and remediate IT vulnerabilities, supporting robust security postures for a diverse client base. The company's focus on integrated, automated solutions and recurring revenue streams positions it competitively in the evolving cybersecurity landscape.Serves enterprise, government, ...

Core Insights - Qualys, Inc. has extended its partnership with the San Francisco Unicorns as the Major Partner and Official Cybersecurity Partner for the 2026 and 2027 seasons of Major League Cricket (MLC) [1] - The partnership aims to promote cricket in the Bay Area and strengthen community connections, following a successful inaugural season in 2025 [1] Company Overview - Qualys is a leading provider of cloud-based IT, security, and compliance solutions, serving over 10,000 subscription customers globally, including a majority of the Forbes Global 100 and Fortune 100 [1] - The company offers a unified platform for security and compliance, enabling organizations to automate vulnerability detection and protection across various IT environments [1] Partnership Details - Under the renewed agreement, Qualys will maintain its logo on the front of the Unicorns' matchday and training jerseys, symbolizing a tech-first approach inspired by Silicon Valley [1] - The partnership includes continued engagement with the "Sparkle Army," the dedicated fan community that supports the Unicorns [1] Upcoming Season - The San Francisco Unicorns will compete in the 2026 MLC season under new head coach Cameron White, with the season scheduled from June 18 to July 18, 2026 [1]

Market Overview - The Cloud Native Security Service Market was valued at USD 44.62 billion in 2025 and is projected to reach USD 129.23 billion by 2035, with a CAGR of 11.22% during the forecast period [1] - The U.S. market is estimated at USD 16.84 billion in 2025, expected to grow to USD 49.21 billion by 2035, with a CAGR of 11.36% from 2026 to 2035 [3] Market Drivers - Key factors driving market growth include government laws for data protection compliance, increasing frequency of cyberattacks on cloud-native environments, and organizational needs for automated incident response and real-time threat visibility [1] - In the U.S., the implementation of zero-trust requirements under federal cybersecurity directives and regulatory frameworks supporting cloud data governance are significant drivers [3] Segmentation Analysis By Component - The solutions segment accounted for approximately 62.45% of revenue in 2025, driven by integrated CNAPP platforms [4] - The services segment is expected to grow at the highest CAGR of nearly 12.18% from 2026 to 2035, fueled by demand for managed detection and response (MDR) [4] By Deployment - The public cloud segment contributed 54.37% of revenue in 2025, attributed to scalability and reduced infrastructure costs [5] - The hybrid cloud segment is projected to grow at a CAGR of about 12.54% between 2026 and 2035, driven by the need for balancing cloud agility with on-premises data residency [5] By Enterprise Size - Large enterprises held about 67.82% of the market share due to extensive multi-cloud deployments and regulatory compliance [7] - The SME segment is expected to grow at the fastest rate with a CAGR of around 12.91% from 2026 to 2035, as small and medium-sized businesses accelerate cloud migration [7] By End Use - The BFSI sector accounted for nearly 23.14% of the market in 2025, with strong growth driven by financial data protection mandates and increasing cyber threats [8] Regional Insights - North America held the largest revenue share of over 38.62% in 2025, supported by a robust cloud security technology ecosystem and strict federal regulations [9] - Asia Pacific is the fastest-growing segment with a CAGR of 13.47%, driven by increasing awareness of cloud security risks and government cybersecurity frameworks [10] Threat Landscape - The market is influenced by rising ransomware campaigns, supply chain compromises, and insider threats targeting cloud environments, which are driving investments in cloud security [11] Key Players - Major companies in the market include Palo Alto Networks, CrowdStrike Holdings, Zscaler, Microsoft, Amazon Web Services, Google, and others [14] Recent Developments - In January 2025, Palo Alto Networks enhanced its Prisma Cloud CNAPP platform with AI-powered features for cloud misconfiguration remediation [15] - In March 2025, CrowdStrike launched improved Falcon Cloud Security Posture Management capabilities, focusing on risk prioritization and compliance reporting [16]

Core Viewpoint - Qualys, Inc. is identified as one of the best technology stocks at a 52-week low, with a revised price target of $140 from UBS analyst Roger Boyd, indicating a potential upside of 35.6% from current levels, which aligns with the median upside of 30.81% from 26 analysts covering the stock [1]. Financial Performance - For Q4 FY 2025, Qualys reported a revenue growth of 10%, totaling $175.3 million, with channel partners contributing 51% of total revenue and channel revenue increasing by 17% [2]. - International market revenue grew by 15%, surpassing the domestic market growth of 6%, and the company generated $74.9 million in free cash flows during the quarter [2]. - Adjusted EBITDA for the quarter was $82.6 million, with earnings of $1.87 per diluted share, while operating expenses rose by 11% to $68.9 million due to increased sales and marketing efforts [3]. Future Guidance - For FY 2026, Qualys projects revenue between $717 million and $725 million, reflecting a growth rate of 7% to 8%. For Q1 2026, revenue is estimated to be between $172.5 million and $174.5 million, indicating an 8% to 9% growth rate, with expected earnings ranging from $1.76 to $1.83 per share [4]. - The CFO, Joo Mi Kim, stated that the guidance assumes no significant change in the net dollar expansion rate, with moderate growth from new business in 2026 [5]. Company Overview - Qualys operates as a cloud-based platform provider, delivering security, IT, and compliance solutions both in the United States and internationally. The company was founded in 1999 and is headquartered in Foster City, California [5].

Industry Overview - The technology sector has seen significant returns since the rise of generative AI, with expectations for continued strong performance this year. However, concerns about infrastructure spending and the potential threat of AI to certain domains, such as software engineering, are negatively impacting the sector [1]. Market Sentiment - Nick Evans, a fund manager at Polar Capital, expressed that only a few firms may survive the rise of AI, indicating that application software faces an existential threat from AI coding tools that allow clients to become competitors [2]. - Marta Norton, Chief Investment Strategist at Empower, noted a perplexing market dynamic where what worked in 2025 is struggling in 2026, while previously overlooked stocks are now performing well [3]. Investment Opportunities - A focus on technology stocks trading at their 52-week lows has been identified as a potential opportunity for investors. A list of 11 technology stocks meeting this criterion has been compiled, targeting companies with a market cap of at least $2 billion and trading within a 0% to 3% range of their 52-week lows [5]. Hedge Fund Activity - Research indicates that imitating the top stock picks of leading hedge funds can lead to market outperformance. A quarterly newsletter strategy has achieved a return of 427.7% since May 2014, significantly outperforming its benchmark [6]. Company Analysis: Blackbaud, Inc. (NASDAQ:BLKB) - Blackbaud, Inc. has a potential upside of 25.76% based on a lowered price target of $60 from Robert W. Baird, which reflects a neutral rating. The company reported strong Q4 performance and provided an encouraging outlook for 2026 [7][8]. - Raymond James also lowered its price target for Blackbaud to $60 while maintaining an outperform rating, highlighting better-than-expected Q4 results and a long-term growth plan aiming for mid-single-digit growth through 2030 [9]. Company Analysis: Qualys, Inc. (NASDAQ:QLYS) - Qualys, Inc. has a potential upside of 35.6% based on a revised price target of $140 from UBS, maintaining a neutral rating. The company reported a revenue growth of 10% in Q4, with total revenue of $175.3 million [11][12]. - For 2026, Qualys projects revenue between $717 million and $725 million, indicating a growth rate of 7% to 8%. The first quarter of 2026 is expected to show revenue growth of 8% to 9% [14].

Financial Performance - Revenues increased to $669.1 million in 2025, up from $607.6 million in 2024 and $554.5 million in 2023, reflecting a growth trend [31] - Revenue increased from $554.5 million in 2023 to $669.1 million in 2025, reflecting a growth of approximately 20.6% [140] - As of December 31, 2025, 56% of revenues derived from U.S. customers [55] - In 2025, 49% of revenues were generated by channel partners, up from 43% in 2023 [61] - 22% of revenues in 2025 were generated in foreign currencies, indicating exposure to foreign exchange fluctuations [138] - Approximately 49% of revenues in 2025 were derived from sales through channel partners, up from 43% in 2023 [132] Customer Base and Market Position - The cloud platform is currently utilized by over 10,000 customers worldwide, including a majority of the Forbes Global 100 [31] - As of December 31, 2025, the company had over 10,000 customers worldwide [55] - The company’s growth strategy includes expanding its customer base and enhancing relationships with key security consulting organizations and cloud providers [55] - The company offers free trials and services to prospective customers to encourage adoption of its solutions [63] Product and Service Offerings - The company offers a suite of over 20 Cloud Apps that help organizations manage IT, security, and compliance needs, allowing for scalable and comprehensive solutions [43] - The Vulnerability Management, Detection and Response (VMDR) solution automates asset discovery and remediation, significantly reducing cyber risk exposure [45] - The Enterprise TruRisk Management (ETM) solution quantifies cyber risk in financial terms, enhancing risk prioritization and decision-making [44] - The cloud platform provides real-time visibility and seamless scaling, enabling customers to manage their security and compliance posture effectively [28] - The cloud platform supports automated patch management for various operating systems, enhancing the efficiency of vulnerability remediation [47] Research and Development - The company plans to continue significant investments in research and development to enhance its cloud platform and solutions [56] - The company faces significant challenges in research and development, with no assurance that investments will yield marketable products or enhancements, potentially impacting financial performance [105] Workforce and Employment - The company employs 2,625 full-time employees, with 78% located outside the U.S., primarily in India [75] - The company reported a significant portion of its workforce transitioned to a hybrid work schedule in 2022, continuing this model into 2025 [81] - Over 50% of the executive team comes from underrepresented communities, with more than half of US-based employees also from diverse backgrounds [79] - The company emphasizes employee training and development, offering free self-paced and instructor-led certified training on core topics [85] Compliance and Regulatory Risks - The company’s solutions must help customers maintain compliance with regulations; failure to do so could harm revenues and operating results [152] - Regulatory changes, such as the GDPR and CCPA, impose significant compliance obligations that could lead to increased costs and impact sales of solutions [164] - The United Kingdom's Data Protection Act imposes penalties for noncompliance of up to £17.5 million or 4% of the previous year's annual revenues [165] - Compliance with the EU-U.S. Data Privacy Framework and standard contractual clauses may increase compliance costs and regulatory scrutiny, potentially impacting business operations [165] - The European Union's Data Act, effective September 12, 2025, may require adjustments in contract terms and technical measures for data portability, affecting customer relationships and operational costs [167] Cybersecurity and Risk Management - Cybersecurity threats pose risks to the company's platform and services, with potential liabilities and reputational damage from security incidents [106] - The company has established an Information Security Management System (ISMS) aligned with ISO/IEC 27001 standards to manage cybersecurity risks [211] - A Computer Security Incident Response Team (CSIRT) has been established to manage and respond to security incidents affecting the company's infrastructure [215] - The Product Security Incident Response Team (PSIRT) investigates vulnerabilities across the company's product portfolio and coordinates impact assessments [218] - The board of directors oversees strategic risk exposure, with the Chief Information Security Officer (CISO) responsible for managing cybersecurity threats [222] Financial Risks and Challenges - The company faces risks related to fluctuating operating results, which may impact stock performance and investor confidence [93] - Adverse economic conditions and reduced IT spending have resulted in decreased revenue and earnings, with ongoing geopolitical turmoil and inflationary pressures further impacting customer budgets [111] - The company has experienced longer collection cycles and increased customer bad debt due to economic weakness, which could further strain financial performance [111] - The company may face significant tax liabilities due to potential audits and changes in tax regulations, which could adversely affect operating results [185] - The company’s effective tax rate may increase due to changes in earnings mix and tax laws, potentially harming operating results [186] Strategic Initiatives - The company aims to strengthen its market position by selectively pursuing technology acquisitions to expand its cloud platform capabilities [56] - The company plans to continue recruiting and retaining qualified sales personnel to drive growth [130] - The company has initiatives focused on community engagement, including education and environmental programs, to support local communities [82] Shareholder Returns - The company has authorized a total of $1.6 billion for its share repurchase program, with $1.4 billion utilized as of December 31, 2025 [198] - During the year ended December 31, 2025, the company repurchased 1.4 million shares for approximately $182.9 million [198] - As of December 31, 2025, approximately $160.5 million remained available for share repurchases under the program [198] - The company does not intend to pay dividends on its common stock, limiting returns to stock value appreciation [199] Financial Reporting and Accounting - The company prepares its financial statements in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect reported amounts [206] - Significant assumptions in financial reporting include revenue recognition, accounting for income taxes, and stock-based compensation [206] - Changes in financial accounting standards may lead to unexpected revenue fluctuations and impact reported results [207] - The company must maintain effective internal controls over financial reporting to comply with regulations and ensure timely and accurate financial statements [208] - The company asserts that its internal control over financial reporting was effective as of December 31, 2025, but future effectiveness cannot be guaranteed [209] Market Competition - Increased competition from both large and small vendors in the IT security market may pressure pricing and impact the company's market position [117] - The sales prices of the company's solutions are subject to competitive pressures, which may lead to reduced gross profits and financial results [125] International Operations - The company faces risks associated with international operations, including economic or political instability in foreign markets [134] - The company relies on third-party channel partners for a substantial portion of its revenues, which could impact growth if not effectively managed [132] - The company may face difficulties in renewing agreements with cloud platform providers, potentially leading to increased costs or service disruptions [115] Environmental Sustainability - The company’s cloud-based solutions are designed to improve environmental sustainability by reducing energy consumption and paper costs for customers [87] - The company is committed to advancing supply chain responsibility, ensuring suppliers adhere to high environmental standards like ISO 14001 [89]

Industry Overview - The cybersecurity market is projected to witness a compound annual growth rate (CAGR) of 12.28% from 2026 to 2031, driven by an increase in cyberattacks and the need for enhanced security measures [2]. Company Analysis: Zscaler, Inc. (ZS) - Zscaler offers a comprehensive suite of enterprise security tools, including web security, antivirus, firewalls, and vulnerability management, with a focus on automating risk detection and response [3]. - The company reported a 26% year-over-year revenue increase to $788 million in Q1 of fiscal 2026, with non-GAAP earnings rising approximately 24% to 96 cents per share [5]. - Zscaler is integrating artificial intelligence (AI) into its offerings, with AI security revenue reaching $400 million annual recurring revenue (ARR) at the end of Q1, expected to exceed $500 million in fiscal 2026 [6]. - Despite impressive growth, Zscaler's gross margin decreased to 79.9% from 80.6% year-over-year due to newer products prioritizing speed over profitability [7]. Company Analysis: Qualys, Inc. (QLYS) - Qualys is a leading provider of Vulnerability Management, Detection and Response (VMDR) solutions, experiencing increased customer penetration and product enhancements [8]. - The company reported a 10% year-over-year revenue growth to $175.3 million in Q4 of 2025, with earnings per share increasing by 16.9% to $1.87 [10]. - Qualys is expanding globally, achieving a 15% year-over-year growth in international revenue, which supports customer acquisition without significant acquisition costs [11]. - The total addressable market for Qualys is expected to reach $75 billion by 2029, growing at a CAGR of approximately 12.3%, targeting high-growth areas like cloud security and security analytics [12]. Comparative Analysis - Over the past three months, Zscaler's shares declined by 38.5%, while Qualys' shares fell by 24.3% [14]. - Zscaler trades at a forward sales multiple of 7.51, significantly higher than Qualys' 5.14, indicating a premium for Zscaler despite its tightening gross margins [14]. - The Zacks Consensus Estimate suggests that Qualys will see a 7.8% year-over-year revenue increase to $721.5 million in 2026, with earnings per share projected to rise by 3.5% to $7.32 [13]. Conclusion - While both companies are strong players in the cybersecurity sector, Qualys appears more attractive due to steadier growth and a lower valuation compared to Zscaler, which faces gross margin pressures and a higher valuation [18].

Core Viewpoint - Qualys is a prominent provider of cloud-based cybersecurity and compliance solutions, with significant revenue and market capitalization, leveraging a subscription-driven SaaS model to deliver essential security tools across various industries [1]. Company Overview - Qualys reported a trailing twelve months (TTM) revenue of $669.125 million and a market capitalization of $4 billion as of February 4, 2026 [1]. - The company serves a diverse customer base, including enterprises, government entities, and small to medium-sized businesses (SMBs) across sectors such as financial services, healthcare, manufacturing, and technology [2]. Product Offerings - Qualys offers a comprehensive suite of cloud-based IT, security, and compliance solutions, including vulnerability management, threat protection, patch management, and asset inventory tools [3]. Recent Transactions - CFO Joo Mi Kim sold 6,799 shares for approximately $873,369.30 on February 4, 2026, which was part of a Rule 10b5-1 trading plan adopted in August 2025 [5][7]. - The sale accounted for 7.14% of direct holdings, significantly higher than the recent median of 1.05%, indicating a reduction in available shares [4]. Market Reaction - Following the stock sale, Qualys announced its fourth quarter and full-year results for 2025, leading to a decline in stock price to a 52-week low of $107.17 on February 9, 2026, due to Wall Street's disappointment over the 2026 revenue guidance [8][9]. - The company projected 2026 sales between $717 million and $725 million, reflecting a growth rate of 7% to 8% over 2025, which is lower than the 10% growth experienced in 2025 [9]. Valuation Insights - Qualys shares are currently trading at a price-to-earnings ratio of 20, marking a low point in recent years, which may present a potential buying opportunity for investors [10].

Core Insights - Qualys, Inc. (QLYS) reported strong fourth-quarter results for 2025, with earnings of $1.87 per share, exceeding the Zacks Consensus Estimate of $1.78 by 5.35% and marking a 16.9% increase from the previous year's earnings of $1.60 [1][9] - The company achieved revenues of $175.3 million for Q4 2025, surpassing the Zacks Consensus Estimate by 1.30% and reflecting a 10% year-over-year growth from $159.2 million [2][9] Financial Performance - Non-GAAP gross profit increased by 12% year over year to $149 million, with a non-GAAP gross margin of 85%, up from 84% in the prior year [4] - Non-GAAP operating income rose 13% to $80.1 million, resulting in a margin of 46%, an improvement from 44% a year earlier [4] - Adjusted EBITDA increased by 11% year over year to $82.6 million, maintaining an adjusted EBITDA margin of 47% [5] Revenue Breakdown - Sales from channel partners surged 17%, contributing 51% to total revenues, while direct selling accounted for 49% [3] - U.S. sales grew 6% year over year, contributing approximately 56% to total revenues, while international sales rose 15%, accounting for 44% [3] Cash Flow and Share Repurchase - Qualys ended the quarter with $696.8 million in cash and equivalents, up from $663.6 million in the previous quarter [6] - The company generated operating cash flow of $75.7 million and free cash flow of $74.9 million in Q4 2025 [6] - Qualys repurchased 328,000 shares worth $44.7 million during the quarter, with a total of 10.7 million shares repurchased since February 2018, and authorized an additional $200 million for share repurchase [7] Guidance for Future Performance - For Q1 2026, Qualys expects revenues between $172.5 million and $174.5 million, indicating year-over-year growth of 8-9%, with non-GAAP earnings projected in the range of $1.76-$1.83 [8] - For the full year 2026, the company anticipates revenues between $717 million and $725 million, implying year-over-year growth of 7-8%, and non-GAAP earnings forecasted to be in the band of $7.17-$7.45 per share [10]

Core Insights - Qualys is transitioning from traditional vulnerability detection to a "pre-breach" Risk Operations Center (ROC) that integrates exposure management, exploit validation, risk quantification, and automated remediation [2][3][7] Financial Performance - For FY2025, Qualys reported a revenue increase of 10% to $669.1 million, with an adjusted EBITDA margin of 47% and EPS of $7.07, reflecting a 15% rise [7] - Free cash flow reached $304.4 million, and channel sales accounted for 51% of total revenue, with international growth at 15%, surpassing U.S. growth [7] - Guidance for 2026 indicates projected revenue of $717–725 million, representing a growth rate of 7–8%, with mid-40s EBITDA margins [7] Strategic Initiatives - The company is enhancing its Enterprise TruRisk Management (ETM) platform to incorporate third-party data and has introduced an orchestration layer to unify findings from both Qualys and non-Qualys sources [4][7] - A notable feature is "Agent Val," an agentic AI workflow that validates the exploitability of vulnerabilities in specific environments, aiming to improve remediation efficiency [5][7] - Qualys is promoting a vendor-agnostic approach to unify fragmented security tools into a centralized risk fabric that quantifies risk in business terms [3][7]