Core Viewpoint - Q2 Metals Corp. has successfully closed an upsized private placement of 26 million flow-through shares, raising total gross proceeds of $26 million to fund Canadian exploration expenses related to its mineral projects in Québec [1][3]. Group 1: Offering Details - The private placement consisted of 26,000,000 common shares sold at a price of $1.00 per share, including the full exercise of the Agent's option for an additional $5 million [1]. - The offering was conducted on a best efforts basis by Canaccord Genuity Corp. as the sole agent and bookrunner [2]. - The offering included 25,000,000 LIFE FT Shares and 1,000,000 Non-LIFE FT Shares, utilizing various prospectus exemptions [2]. Group 2: Use of Proceeds - The gross proceeds from the sale of the FT Shares will be used to incur eligible "Canadian exploration expenses" related to the Company's mineral projects in Québec, with a commitment to renounce these expenditures to subscribers by December 31, 2025 [3]. Group 3: Agent Compensation - As compensation for its services, the Agent received a cash commission of $1.3 million and 1.3 million non-transferable broker warrants, allowing the purchase of common shares at $0.90 each for three years [4]. Group 4: Regulatory and Compliance - The offering is subject to final approval from the TSX Venture Exchange, with specific hold periods for the LIFE FT Shares and Non-LIFE FT Shares under Canadian securities laws [5]. Group 5: Company Overview - Q2 Metals Corp. is focused on the Cisco Lithium Project in Québec, which spans 41,253 hectares and has significant potential for lithium mineralization [7][8]. - The Cisco Project has an initial exploration target estimating between 215 to 329 million tonnes of lithium mineralization at grades of 1.0 to 1.38% Li2O [8]. - Ongoing drill testing indicates potential for significant expansion at the Cisco Mineralized Zone, with results expected in Q3 2025 [9].

Core Viewpoint - Q2 Holdings (QTWO) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive earnings outlook that may lead to increased stock price [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are a significant factor influencing stock prices [4][6]. - Rising earnings estimates for Q2 Holdings suggest an improvement in the company's underlying business, likely resulting in upward pressure on the stock price [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell) [7]. - Stocks in the top 20% of Zacks-covered stocks, like Q2 Holdings with its Zacks Rank 2, are positioned for potential market-beating returns [10]. Earnings Estimate Revisions for Q2 Holdings - Q2 Holdings is projected to earn $2.22 per share for the fiscal year ending December 2025, with no year-over-year change [8]. - Over the past three months, the Zacks Consensus Estimate for Q2 Holdings has increased by 36.1%, reflecting positive sentiment among analysts [8].

Group 1: Earnings Performance - Q2 Holdings reported quarterly earnings of $0.5 per share, missing the Zacks Consensus Estimate of $0.51 per share, but showing an increase from $0.26 per share a year ago, representing an earnings surprise of -1.96% [1] - The company posted revenues of $195.15 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.68% and increasing from $172.89 million year-over-year [2] - Over the last four quarters, Q2 Holdings has surpassed consensus revenue estimates four times, but has only exceeded EPS estimates once [2] Group 2: Stock Performance and Outlook - Q2 Holdings shares have declined approximately 10.2% since the beginning of the year, contrasting with the S&P 500's gain of 8.3% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the upcoming quarter is $0.53 on revenues of $195.37 million, and for the current fiscal year, it is $2.14 on revenues of $782.13 million [7] Group 3: Industry Context - The Internet - Software industry, to which Q2 Holdings belongs, is currently ranked in the top 30% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Q2 Holdings' stock performance [5] - Another company in the same industry, CI&T Inc., is expected to report quarterly earnings of $0.06 per share, reflecting a year-over-year change of +100% [9]

Financial Data and Key Metrics Changes - The company generated revenue of $195 million, representing a 13% year-over-year growth and exceeding guidance [9][20] - Adjusted EBITDA reached $46 million, with a margin of 23.5%, reflecting a 53% increase from the prior year [9][26] - Free cash flow was strong at $42 million, with cash and investments totaling $532 million, up from $486 million in the previous quarter [9][27] Business Line Data and Key Metrics Changes - Subscription-based revenues grew 16% year-over-year, accounting for 81% of total revenue [21] - Services and other revenues increased by 1% year-over-year, driven by higher professional services tied to core conversions and M&A activity [21] - Total annualized recurring revenue (ARR) grew to $861 million, up 10% year-over-year, with subscription ARR at $716 million, a 13% increase [22] Market Data and Key Metrics Changes - The company saw significant bookings from Tier one, Tier two, and Tier three segments, with notable M&A activity among customers leading to incremental bookings [10][24] - The backlog increased to approximately $2.4 billion, up 3% sequentially and 21% year-over-year, driven by expansion with existing customers [24] Company Strategy and Development Direction - The company is focused on digital transformation, AI innovation, and enhancing fraud prevention capabilities through its Innovation Studio [12][32] - The strategy includes expanding into larger enterprise deals and maintaining a strong pipeline for the second half of the year [18][39] - The company aims to leverage M&A activity among its customers to drive growth and efficiency [11][97] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline and anticipated a strong second half of the year, particularly in enterprise activity [35][39] - The company expects to see lower churn rates in the second half of the year, despite a higher concentration of churn in Q2 [23][46] - The outlook for revenue and adjusted EBITDA for the full year has been raised, reflecting strong performance and market demand [29] Other Important Information - The company is transitioning to a cloud-based infrastructure, which is expected to enhance operational efficiency and reduce costs [111][114] - The Innovation Studio is becoming increasingly central to the company's offerings, with over 85% of digital banking customers utilizing it [18][62] Q&A Session Summary Question: Is the demand environment improving? - Management noted a strong pipeline but did not see a significant lift in new opportunities yet [35][36] Question: What is the outlook for enterprise activity? - Management indicated a more normal mix of Tier one deals expected in the second half of the year [39][40] Question: Can you quantify the penetration of risk and fraud solutions? - Management highlighted strong penetration but noted that quantifying it is challenging due to the nature of the offerings [44] Question: What drove the higher churn in Q2? - Management attributed it to localized churn and M&A transactions impacting the second quarter [46] Question: How is the gross margin outlook evolving? - Management indicated that both cost management and revenue mix shifts are contributing to improved gross margin expectations [54] Question: What are the cross-selling initiatives looking like? - Management reported strong cross-selling opportunities following the recent client conference [108]

Financial Data and Key Metrics Changes - The company generated revenue of $195 million, representing a 13% year-over-year growth and exceeding guidance [7][18] - Adjusted EBITDA reached $46 million, with a margin of 23.5%, reflecting strong operational execution [7][24] - Free cash flow was $42 million, driven by improved profitability and effective working capital management [25][26] Business Line Data and Key Metrics Changes - Subscription-based revenues grew 16% year-over-year, accounting for 81% of total revenue [19] - Services and other revenues increased by 1% year-over-year, primarily due to higher professional services tied to core conversions and M&A activity [19][20] - Total annualized recurring revenue (ARR) grew to $861 million, up 10% year-over-year, with subscription ARR at $716 million, a 13% increase [20] Market Data and Key Metrics Changes - The company saw strong bookings performance, including six Tier one wins and notable activity in Tier two and three segments [7][8] - The backlog increased to approximately $2.4 billion, representing a 21% year-over-year growth [21] Company Strategy and Development Direction - The company is focused on driving AI innovation across its product portfolio, particularly in fraud prevention [13][14] - The strategy includes enhancing the Innovation Studio ecosystem to provide customers with access to best-in-class solutions [12][15] - The company aims to capitalize on market demand and expansion opportunities while delivering operational excellence [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline and anticipated stronger enterprise activity in the second half of the year [33][36] - The company expects continued focus on risk and fraud solutions, which are critical for financial institutions [11][12] - Management raised full-year revenue guidance to a range of $783 million to $788 million, reflecting a year-over-year growth of 12% to 13% [27] Other Important Information - The company hosted its annual customer conference, highlighting the commitment of financial institutions to digital transformation [11][30] - The gross margin improved to 57.5%, driven by a higher mix of subscription-based revenues [22] Q&A Session Summary Question: Is the demand environment showing improvement? - Management noted a strong pipeline but did not see a significant lift in new opportunities yet [33][34] Question: What is the outlook for enterprise activity? - Management indicated that enterprise deals are expected to be more prominent in the second half of the year, with a normal mix of Tier one deals [35][37] Question: Can you quantify the penetration of risk and fraud solutions? - Management stated that there is strong penetration of risk and fraud products among existing customers, with opportunities for further sales [40][42] Question: What drove the higher churn in the second quarter? - Management attributed the higher churn to localized factors and M&A transactions, expecting lower churn in the second half [43][44] Question: How is the company addressing competition in the risk and fraud space? - Management highlighted that many new vendors are partnering with the company to offer comprehensive solutions through Innovation Studio [95] Question: What is the strategy for cross-selling initiatives? - Management reported strong cross-selling momentum following the client conference, with expectations for a robust second half [102][103] Question: What are the long-term benefits of the cloud migration? - Management discussed cost savings and strategic opportunities arising from the transition to the cloud, enhancing operational efficiency [105][108]

[PART I: FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%3A%20FINANCIAL%20INFORMATION) This section presents Q2 Holdings, Inc.'s unaudited condensed consolidated financial statements and management's analysis [Item 1. Financial Statements.](index=6&type=section&id=Item%201.%20Financial%20Statements.) This section presents Q2 Holdings, Inc.'s unaudited condensed consolidated financial statements and related notes for the periods ended June 30, 2025, and December 31, 2024 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The condensed consolidated balance sheets show the company's financial position as of June 30, 2025, compared to December 31, 2024, highlighting changes in assets, liabilities, and stockholders' equity | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :------------------------------- | | Total Assets | $1,385,413 | $1,294,795 | | Total Liabilities | $801,078 | $776,999 | | Total Stockholders' Equity | $584,335 | $517,796 | | Cash and cash equivalents | $414,275 | $358,560 | | Investments | $117,797 | $88,066 | | Convertible notes, current portion | $493,438 | $190,331 | | Deferred revenues, current portion | $179,438 | $137,700 | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) The condensed consolidated statements of comprehensive income (loss) detail the company's financial performance for the three and six months ended June 30, 2025, and 2024, showing significant improvements in net income and a shift from loss to profit | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Revenues | $195,148 | $172,890 | $384,883 | $338,398 | | Gross profit | $104,564 | $86,827 | $205,554 | $169,079 | | Income (loss) from operations | $9,840 | $(13,703) | $12,029 | $(27,888) | | Net income (loss) | $11,764 | $(13,060) | $16,517 | $(26,903) | | Basic EPS | $0.19 | $(0.22) | $0.27 | $(0.45) | | Diluted EPS | $0.18 | $(0.22) | $0.25 | $(0.45) | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This statement outlines the changes in stockholders' equity for the three and six months ended June 30, 2025, and 2024, reflecting impacts from net income/loss, stock-based compensation, and common stock issuances | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Total stockholders' equity, beginning balances | $545,458 | $464,971 | $517,796 | $448,479 | | Stock-based compensation expense | $23,160 | $25,610 | $45,369 | $47,736 | | Net income (loss) | $11,764 | $(13,060) | $16,517 | $(26,903) | | Total stockholders' equity, ending balances | $584,335 | $480,665 | $584,335 | $480,665 | | Common stock (in shares), ending balances | 62,442 | 60,283 | 62,442 | 60,283 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The condensed consolidated statements of cash flows provide a summary of cash generated from or used in operating, investing, and financing activities for the six months ended June 30, 2025, and 2024, showing a significant increase in cash from operating activities in 2025 | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash provided by operating activities | $92,172 | $49,466 | | Net cash provided by (used in) investing activities | $(41,617) | $12,054 | | Net cash provided by financing activities | $4,218 | $11,448 | | Net increase in cash, cash equivalents and restricted cash | $55,224 | $72,708 | | Cash, cash equivalents and restricted cash, end of period | $416,017 | $306,340 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and disclosures for the condensed consolidated financial statements, covering accounting policies, revenue, debt, and other financial details [1. Organization and Description of Business](index=10&type=section&id=Note%201.%20Organization%20and%20Description%20of%20Business) Q2 Holdings, Inc. is a leading provider of digital solutions to financial institutions, FinTechs, and Alt-FIs, primarily operating on a software-as-a-service (SaaS) model, enabling digital banking, lending, and banking-as-a-service (BaaS) solutions - **Q2 Holdings, Inc.** provides digital solutions to financial institutions, FinTechs, and Alt-FIs, primarily through a **SaaS model**, offering **digital banking**, **digital lending**, relationship pricing, and **BaaS services**[21](index=21&type=chunk) [2. Summary of Significant Accounting Policies](index=10&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the basis of presentation, principles of consolidation, use of estimates, and concentration of credit risk, confirming no material changes to significant accounting policies during the six months ended June 30, 2025, and detailing basic and diluted EPS computations - **No material changes** to significant accounting policies occurred during the six months ended June 30, 2025, compared to the prior fiscal year[26](index=26&type=chunk) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic net income (loss) per common share | $0.19 | $(0.22) | $0.27 | $(0.45) | | Diluted net income (loss) per common share | $0.18 | $(0.22) | $0.25 | $(0.45) | | Weighted-average common shares outstanding, basic (in thousands) | 62,353 | 60,162 | 61,790 | 59,804 | | Weighted-average common shares outstanding, diluted (in thousands) | 69,642 | 60,162 | 64,963 | 59,804 | [3. Revenues](index=12&type=section&id=Note%203.%20Revenues) Revenue is recognized when control of goods or services is transferred, primarily from subscription fees, transactional revenue, and professional services, with significant remaining performance obligations | Revenue Source | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Subscription | $158,422 | $136,064 | $312,711 | $266,421 | | Transactional | $16,734 | $17,079 | $35,351 | $34,130 | | Services and other | $19,992 | $19,747 | $36,821 | $37,847 | | Total revenues | $195,148 | $172,890 | $384,883 | $338,398 | - Remaining performance obligations totaled **$2.36 billion** as of June 30, 2025, with approximately **54%** expected to be recognized as revenue in the next 24 months[34](index=34&type=chunk) - Allowance for credit losses related to contract assets was **$0.04 million** (June 30, 2025) vs. **$0.02 million** (December 31, 2024), and for accounts receivable was **$0.4 million** (June 30, 2025) vs. **$0.3 million** (December 31, 2024)[35](index=35&type=chunk)[36](index=36&type=chunk) [4. Fair Value Measurements](index=13&type=section&id=Note%204.%20Fair%20Value%20Measurements) This note details the fair value hierarchy for financial assets, categorizing them into Level I (quoted prices in active markets) and Level II (observable inputs other than quoted prices), with the majority of investments falling under Level II | Asset Category | Fair Value (June 30, 2025, in thousands) | Level I (in thousands) | Level II (in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------- | :---------------------- | | Money market funds | $37,969 | $37,969 | $— | | Corporate bonds and commercial paper | $49,235 | $— | $49,235 | | Certificates of deposit | $13,454 | $— | $13,454 | | U.S. government securities | $54,533 | $— | $54,533 | | Total Investments | $117,222 | $— | $117,222 | [5. Cash, Cash Equivalents and Investments](index=15&type=section&id=Note%205.%20Cash%2C%20Cash%20Equivalents%20and%20Investments) The company's cash, cash equivalents, and investments primarily consist of cash, U.S. government securities, corporate bonds, commercial paper, certificates of deposit, and money market funds. All debt investments are classified as available-for-sale and recorded at fair value, with no credit loss impairments recognized - Cash, cash equivalents, and investments totaled **$532.1 million** as of June 30, 2025, compared to **$446.6 million** as of December 31, 2024[12](index=12&type=chunk)[44](index=44&type=chunk) - **No impairments** for credit losses were recognized on available-for-sale debt securities during the six months ended June 30, 2025 or 2024[42](index=42&type=chunk) | Investment Category | Fair Value (June 30, 2025, in thousands) | Fair Value (December 31, 2024, in thousands) | | :-------------------------------- | :--------------------------------------- | :----------------------------------------- | | Due within one year or less | $110,655 | $49,460 | | Due after one year through two years | $6,567 | $38,256 | | Total Debt Investments | $117,222 | $87,716 | [6. Goodwill and Intangible Assets](index=17&type=section&id=Note%206.%20Goodwill%20and%20Intangible%20Assets) Goodwill remained stable at $512.9 million, with no impairment identified. Intangible assets, including acquired technology and capitalized software development costs, decreased slightly due to amortization - Goodwill carrying amount was **$512.9 million** at both June 30, 2025, and December 31, 2024, with **no impairment identified**[50](index=50&type=chunk) | Intangible Asset Category | Net Carrying Amount (June 30, 2025, in thousands) | Net Carrying Amount (December 31, 2024, in thousands) | | :-------------------------------- | :------------------------------------------------ | :-------------------------------------------------- | | Customer relationships | $— | $94 | | Acquired technology | $26,298 | $37,306 | | Capitalized software development costs | $60,471 | $57,233 | | Total Intangible Assets | $86,769 | $94,633 | - Capitalized software development costs were **$11.6 million** for the six months ended June 30, 2025, compared to **$13.4 million** for the same period in 2024[50](index=50&type=chunk) [7. Leases](index=18&type=section&id=Note%207.%20Leases) The company leases office space under non-cancellable operating leases in various U.S. cities and internationally. A $2.4 million lease liability was recorded for a U.S. office lease renewal in Q2 2025, with no impairment charges related to right-of-use assets - A **$2.4 million** lease liability was recorded in Q2 2025 for the renewal of a U.S. office lease agreement, with a corresponding **$2.1 million** right-of-use asset[53](index=53&type=chunk) | Year Ended December 31, | Operating Lease Payments (in thousands) | | :------------------------ | :-------------------------------------- | | 2025 (July 1 to December 31) | $5,973 | | 2026 | $10,569 | | 2027 | $9,389 | | 2028 | $6,266 | | 2029 | $4,771 | | Thereafter | $16,859 | | Total lease payments | $53,827 | | Less: imputed interest | $(7,941) | | Total operating lease liabilities | $45,886 | [8. Commitments and Contingencies](index=18&type=section&id=Note%208.%20Commitments%20and%20Contingencies) The company has non-cancelable contractual commitments related to convertible notes, third-party products, and sponsorship obligations. A non-recurring legal settlement of $1.8 million was paid in March 2025 for a commercial real estate dispute | Year Ended December 31, | Contractual Commitments (in thousands) | | :------------------------ | :------------------------------------- | | 2025 (July 1 to December 31) | $233,904 | | 2026 | $366,976 | | 2027 | $31,090 | | 2028 | $14,330 | | 2029 | $182 | | Thereafter | $— | | Total commitments | $646,482 | - In March 2025, the Company paid **$1.8 million** to settle a dispute with a former commercial real estate broker, recorded as a **non-recurring charge**[59](index=59&type=chunk) [9. Debt](index=19&type=section&id=Note%209.%20Debt) This note details the company's convertible senior notes (2026 Notes and 2025 Notes), capped call transactions, and a revolving credit agreement. The 2025 Notes mature in November 2025 and the 2026 Notes in June 2026. The company has a $125.0 million revolving credit facility with no outstanding borrowings as of June 30, 2025 | Note Type | Date Issued | Maturity Date | Principal (in thousands) | Interest Rate per Annum | | :---------- | :---------- | :------------ | :----------------------- | :---------------------- | | 2026 Notes | June 1, 2019 | June 1, 2026 | $303,995 | 0.75% | | 2025 Notes | November 15, 2020 | November 15, 2025 | $191,000 | 0.125% | - The company repurchased **$12.3 million** of 2026 Notes and **$159.0 million** of 2025 Notes in March 2023, resulting in a **$19.9 million gain** on early debt extinguishment[64](index=64&type=chunk) - A five-year secured Revolving Credit Agreement provides for a revolving line of credit of up to **$125.0 million**, with **no outstanding borrowings** as of June 30, 2025[73](index=73&type=chunk)[75](index=75&type=chunk) | Interest Expense | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Contractual interest expense | $708 | $630 | $1,426 | $1,259 | | Amortization of debt issuance costs | $543 | $495 | $1,086 | $991 | | Total | $1,251 | $1,125 | $2,512 | $2,250 | [10. Stock-Based Compensation](index=22&type=section&id=Note%2010.%20Stock-Based%20Compensation) The company has equity incentive plans (2014 Plan, 2023 Plan) and an Employee Stock Purchase Plan (ESPP) to grant stock-based awards. Total stock-based compensation expense decreased for both the three and six months ended June 30, 2025, compared to 2024 | Expense Category | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Cost of revenues | $2,062 | $3,400 | $5,280 | $6,565 | | Sales and marketing | $3,989 | $4,469 | $7,441 | $8,340 | | Research and development | $4,161 | $4,625 | $8,203 | $8,468 | | General and administrative | $12,288 | $11,837 | $22,586 | $21,759 | | Total stock-based compensation expense | $22,500 | $24,331 | $43,510 | $45,132 | [11. Income Taxes](index=23&type=section&id=Note%2011.%20Income%20Taxes) The company's effective tax rate for Q2 2025 was 12.8%, lower than the statutory rate due to a valuation allowance, with recent tax law changes not yet reflected | Period | Effective Tax Rate | | :-------------------------------- | :------------------- | | Three Months Ended June 30, 2025 | 12.8% | | Three Months Ended June 30, 2024 | (19.0)% | | Six Months Ended June 30, 2025 | 11.8% | | Six Months Ended June 30, 2024 | (15.7)% | - The company maintains a **valuation allowance** against most deferred tax assets due to historical pretax net losses[83](index=83&type=chunk) - The 'One Big Beautiful Bill Act' (H.R. 1), signed on July 4, 2025, includes favorable changes to federal tax law for 2025, but these were **not reflected** in the June 30, 2025, income tax provision[132](index=132&type=chunk) [12. Segments and Geographic Information](index=23&type=section&id=Note%2012.%20Segments%20and%20Geographic%20Information) The company operates as a single operating segment, providing digital solutions to financial institutions, FinTechs, and Alt-FIs, with the majority of revenues derived from subscription fees. Substantially all principal operations, assets, and decision-making functions are located in the United States - The company operates as a **single operating segment**, with its chief operating decision maker (CEO) reviewing financial information on a consolidated basis[85](index=85&type=chunk)[86](index=86&type=chunk) - The majority of revenues come from **subscription fees** for solutions hosted in third-party data centers or public cloud service providers[85](index=85&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) This section provides management's perspective on the company's financial condition and results, highlighting revenue growth, improved operating income, and strategic investments [Overview](index=24&type=section&id=Overview) Q2 Holdings, Inc. is a leading provider of digital solutions for financial institutions, FinTechs, and Alt-FIs, offering a broad portfolio of digital banking, lending, and BaaS solutions. The company primarily uses a SaaS model, with revenues growing as customers adopt more solutions and increase End-User engagement. Strategic investments in innovation and acquisitions are aimed at expanding market presence and improving operating efficiencies - Q2 offers **digital banking**, **digital lending**, relationship pricing, **Q2 Innovation Studio**, and **Helix** (**cloud-native core** and **BaaS**) solutions[88](index=88&type=chunk) - The company primarily sells solutions via a **SaaS model**, with pricing based on solutions purchased and Registered Users, leading to **revenue growth** from increased End-User engagement and additional solution adoption[92](index=92&type=chunk) - Investments in sales, marketing, and R&D are expected to increase costs in absolute dollars but **improve margins** over the long term through economies of scale[93](index=93&type=chunk)[94](index=94&type=chunk)[96](index=96&type=chunk) [Recent Events](index=26&type=section&id=Recent%20Events) Recent events, including U.S. tariffs, changes in financial services regulations (like the GENIUS Act), and heightened geopolitical instability, have introduced uncertainty but have not yet had a material impact on the company's operations or financial performance. The company continues to monitor these evolving conditions - U.S. tariffs and trade measures, regulatory changes (e.g., GENIUS Act signed July 18, 2025), and geopolitical instability have **not had a material impact** on operations or financial performance to date[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk)[101](index=101&type=chunk) [Key Operating Measures](index=27&type=section&id=Key%20Operating%20Measures) The company monitors Installed Customers, Registered Users, Net Revenue Retention Rate, Annualized Recurring Revenue (ARR), and Revenue Churn to evaluate growth trends and operational effectiveness. All metrics show positive trends, indicating strong customer retention and expansion | Metric | December 31, 2024 | December 31, 2023 | December 31, 2022 | | :------------------------ | :------------------ | :------------------ | :------------------ | | Installed Customers | 460 | 450 | 444 | | Registered Users (millions) | 24.7 | 22.0 | 21.1 | | Net Revenue Retention Rate | 109% | 108% | 110% | | Subscription Net Revenue Retention Rate | 114% | 112% | 115% | | Annual Revenue Churn | 4.4% | 6.1% | 6.3% | | Metric | June 30, 2025 | June 30, 2024 | | :------------------------ | :------------ | :------------ | | Registered Users (millions) | 26.2 | 23.6 | | Subscription ARR (millions) | $716.0 | $633.9 | | Total ARR (millions) | $860.6 | $783.0 | [Non-GAAP Financial Measures](index=28&type=section&id=Non-GAAP%20Financial%20Measures) The company uses non-GAAP financial measures, including Non-GAAP Operating Income and Adjusted EBITDA, to provide supplemental information for assessing operating performance. These measures exclude items like stock-based compensation, amortization of acquired intangibles, and non-recurring legal settlements to offer a clearer view of core operational results - Non-GAAP measures **exclude** deferred revenue reduction from purchase accounting, stock-based compensation, transaction-related costs, amortization of acquired technology and intangibles, lease and other restructuring charges, and non-recurring legal settlements[112](index=112&type=chunk) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | GAAP operating income (loss) | $9,840 | $(13,703) | $12,029 | $(27,888) | | Non-GAAP operating income | $37,756 | $22,475 | $70,453 | $40,556 | | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net income (loss) | $11,764 | $(13,060) | $16,517 | $(26,903) | | Adjusted EBITDA | $45,798 | $29,871 | $86,508 | $55,104 | [Components of Operating Results](index=32&type=section&id=Components%20of%20Operating%20Results) This section details the components of operating results, including revenue recognition, cost of revenues, and operating expenses, primarily from subscription-based SaaS solutions - Revenues are primarily derived from **subscription fees** for SaaS solutions, transactional revenue, and professional/implementation services, recognized over time or as incurred[117](index=117&type=chunk)[118](index=118&type=chunk) - Cost of revenues includes **personnel costs** for implementation and support, **third-party data center and cloud costs**, **amortization** of deferred costs, and acquired technology intangibles[119](index=119&type=chunk) - Operating expenses consist of **sales and marketing**, **research and development**, **general and administrative**, **amortization of acquired intangibles**, and **lease and other restructuring charges**[122](index=122&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) This section provides a detailed comparison of the company's financial performance for the three and six months ended June 30, 2025, versus 2024, showing significant revenue growth, improved gross profit margins, and a shift from operating loss to income. Key drivers include increased subscription revenue and reduced amortization expenses | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------------------------- | :---------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Revenues | $195,148 | $172,890 | $384,883 | $338,398 | | Cost of revenues | $90,584 | $86,063 | $179,329 | $169,319 | | Gross profit | $104,564 | $86,827 | $205,554 | $169,079 | | Income (loss) from operations | $9,840 | $(13,703) | $12,029 | $(27,888) | | Net income (loss) | $11,764 | $(13,060) | $16,517 | $(26,903) | | Metric (as % of revenues) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Gross profit | 53.6% | 50.2% | 53.4% | 50.0% | | Income (loss) from operations | 5.0% | (7.9)% | 3.1% | (8.2)% | | Net income (loss) | 6.0% | (7.6)% | 4.3% | (8.0)% | - Revenues increased by **12.9%** (QoQ) and **13.7%** (YoY), primarily driven by a **$22.4 million** (QoQ) and **$46.3 million** (YoY) increase in subscription revenue[137](index=137&type=chunk)[138](index=138&type=chunk) - Amortization of acquired intangibles decreased by **100%** (QoQ) and **99%** (YoY) due to assets being fully amortized[152](index=152&type=chunk) - Lease and other restructuring charges decreased by **127%** (QoQ) to a credit of **$0.3 million**, mainly due to a **$0.7 million reversal** of a previously accrued liability[153](index=153&type=chunk) [Seasonality and Quarterly Results](index=41&type=section&id=Seasonality%20and%20Quarterly%20Results) Operating results fluctuate quarterly due to investment timing and implementation activities, which are historically lower in the first half of the year. General economic conditions and global events can disrupt typical seasonality trends, making period-to-period comparisons less meaningful - Operating results fluctuate due to investment timing and implementation activities, which tend to be **lower in the first half of the year**[159](index=159&type=chunk) - General economic conditions and global events can impact seasonality, making period-to-period comparisons **potentially unreliable** for future results[159](index=159&type=chunk) [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company's liquidity sources include $532.1 million in cash, cash equivalents, and investments, along with access to a $125.0 million Revolving Credit Agreement. Cash flow from operating activities significantly increased to $92.2 million for the six months ended June 30, 2025, from $49.5 million in the prior year - Principal sources of liquidity as of June 30, 2025, were **$532.1 million** in cash, cash equivalents, and investments, plus a **$125.0 million** Revolving Credit Agreement[160](index=160&type=chunk) | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash provided by operating activities | $92,172 | $49,466 | | Net cash used in investing activities | $(41,617) | $12,054 | | Net cash provided by financing activities | $4,218 | $11,448 | | Net increase in cash, cash equivalents and restricted cash | $55,224 | $72,708 | - Operating cash flow increase in 2025 was driven by **net income** and **non-cash adjustments**, partially offset by increases in accounts receivable and deferred solution/implementation costs[163](index=163&type=chunk) [Contractual Obligations and Commitments](index=43&type=section&id=Contractual%20Obligations%20and%20Commitments) The company's primary commitments include convertible senior notes, non-cancelable operating leases, and minimum purchase commitments for third-party products and sponsorship obligations, as detailed in Notes 7 and 8 to the financial statements - Principal commitments include **2026 Notes**, **2025 Notes**, non-cancelable operating leases, and minimum purchase commitments for sponsorship, third-party products, and co-location fees[170](index=170&type=chunk) [Recent Accounting Pronouncements](index=43&type=section&id=Recent%20Accounting%20Pronouncements) This section refers to Note 2 for details on recent accounting pronouncements, including ASU No. 2023-09 (Income Tax Disclosures) and ASU No. 2024-03 (Expense Disaggregation Disclosures), which the company is currently evaluating for impact on future financial statements - The company is evaluating the impact of **ASU No. 2023-09** (Income Taxes) and **ASU No. 2024-03** (Expense Disaggregation Disclosures) on its financial statement disclosures[28](index=28&type=chunk)[29](index=29&type=chunk)[171](index=171&type=chunk) [Critical Accounting Policies and Significant Judgements and Estimates](index=43&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgements%20and%20Estimates) The preparation of financial statements requires management to make estimates and assumptions, which are based on historical experience and other reasonable factors. No material changes to significant accounting policies were reported for the period - The preparation of financial statements involves **significant estimates and assumptions**, which are regularly evaluated[172](index=172&type=chunk) - **No material changes** to critical accounting policies and significant judgments and estimates were reported[173](index=173&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk.](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) This section discusses the company's exposure to market risks, primarily interest rate risk, foreign currency risk, and inflation risk. The company does not use derivative financial instruments for speculative purposes and believes it has no material exposure to interest rate changes due to the short-term nature of investments. Foreign currency and inflation risks are currently considered insignificant but are continuously monitored - The company's primary market risks are **interest rate risk**, **foreign currency risk**, and **inflation risk**[174](index=174&type=chunk) - Due to the **short-term nature of investments**, the company believes it has **no material exposure** to changes in the fair value of its investment portfolio from interest rate changes[175](index=175&type=chunk) - Fixed interest rates on convertible notes (**0.75%** for 2026 Notes, **0.125%** for 2025 Notes) mitigate interest rate risk on these obligations[175](index=175&type=chunk) - Foreign currency risk from operations in India, Mexico, Canada, Australia, and the UK is **not considered significant** due to low payment volumes, and the company does not currently use derivatives for hedging[178](index=178&type=chunk)[179](index=179&type=chunk) - Inflation has **not had a direct material effect** on the business, but the inability to offset higher costs through price increases could harm future results[180](index=180&type=chunk) [Item 4. Controls and Procedures.](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures.) Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of June 30, 2025, concluding they were effective. No material changes in internal control over financial reporting were identified during the quarter - Disclosure controls and procedures were evaluated and deemed **effective** as of June 30, 2025[182](index=182&type=chunk) - **No material changes** in internal control over financial reporting were identified during the three-month period ended June 30, 2025[183](index=183&type=chunk) [PART II: OTHER INFORMATION](index=45&type=section&id=PART%20II%3A%20OTHER%20INFORMATION) This section provides other information including legal proceedings, risk factors, and equity security sales [Item 1. Legal Proceedings.](index=45&type=section&id=Item%201.%20Legal%20Proceedings.) The company is not currently a party to any legal proceedings that management believes would have a material adverse impact on its business, financial condition, results of operations, or cash flows - Management believes there are **no pending legal claims or actions** that would materially impact the company's business or financial condition[185](index=185&type=chunk) [Item 1A. Risk Factors.](index=45&type=section&id=Item%201A.%20Risk%20Factors.) This section updates the risk factors from the Annual Report on Form 10-K, specifically highlighting the potential adverse effects of changes to U.S. trade policy, tariffs, and import/export regulations. While these developments have not yet had a material impact, the company continues to monitor their potential macroeconomic implications - Changes to U.S. trade policy, tariffs, and import/export regulations may **indirectly affect** the business by impacting third-party service providers, cloud infrastructure partners, or customers, potentially affecting demand or increasing service delivery costs[187](index=187&type=chunk) - To date, these trade developments have **not had a material impact** on operations or financial performance[188](index=188&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) There were no unregistered sales of equity securities or use of proceeds to report for the period - **No unregistered sales** of equity securities or use of proceeds occurred[189](index=189&type=chunk) [Item 3. Defaults Upon Senior Securities.](index=45&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities.) There were no defaults upon senior securities to report for the period - **No defaults** upon senior securities occurred[190](index=190&type=chunk) [Item 4. Mine Safety Disclosures.](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the company - Mine Safety Disclosures are **not applicable** to the registrant[191](index=191&type=chunk) [Item 5. Other Information.](index=45&type=section&id=Item%205.%20Other%20Information.) This section discloses Rule 10b5-1 Trading Plans entered into by certain officers and directors, outlining potential sales of common stock. It also mentions the company's mandatory sell-to-cover policy for equity incentive plan participants to cover tax withholding obligations - John Breeden (Chief Delivery Officer) entered a Rule 10b5-1 Trading Plan on May 19, 2025, for potential sale of up to **126,328 shares** between August 2025 and August 2026[192](index=192&type=chunk) - James Offerdahl (Director) entered a Rule 10b5-1 Trading Plan on May 13, 2025, for potential sale of up to **3,627 shares** between August 2025 and August 2026[193](index=193&type=chunk) - Lynn Atchison (Director) entered a Rule 10b5-1 Trading Plan on June 6, 2025, for potential sale of up to **5,000 shares** between September 2025 and September 2026[194](index=194&type=chunk) - The company adopted a **mandatory sell-to-cover policy** in June 2023 for equity incentive plan participants to cover tax withholding obligations upon vesting/settlement[195](index=195&type=chunk) [Item 6. Exhibits.](index=47&type=section&id=Item%206.%20Exhibits.) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including organizational documents, certifications, and XBRL interactive data files - Exhibits include the **Fifth Amended and Restated Certificate of Incorporation**, **Amended and Restated Bylaws**, **CEO/CFO certifications** (Sarbanes-Oxley Act), and **XBRL Instance Document**[198](index=198&type=chunk) [SIGNATURES](index=49&type=section&id=SIGNATURES) The report is signed by Matthew P. Flake, Chief Executive Officer and Chairman, and Jonathan A. Price, Chief Financial Officer, on July 30, 2025, certifying its submission pursuant to the Securities Exchange Act of 1934 - The report was signed by **Matthew P. Flake** (CEO and Chairman) and **Jonathan A. Price** (CFO) on **July 30, 2025**[203](index=203&type=chunk)

Financial Performance - Revenue reached $1951 million, a 13% increase year-over-year from $1729 million in 2Q24[6] - GAAP Gross Profit was $1046 million, up 20% from $868 million in 2Q24[6] - Adjusted EBITDA increased by 53% to $458 million, compared to $299 million in 2Q24, with an Adjusted EBITDA margin of 235%[5,6] - Subscription Annualized Recurring Revenue (ARR) grew by 13% year-over-year, reaching $716 million, up from $634 million in 2Q24[9,11] Backlog and Customer Wins - Total committed Backlog reached approximately $24 billion, representing a 21% year-over-year growth and a 3% sequential growth[5,9,13] - The company signed six Tier 1 contracts (customers with assets above $5 billion) during the quarter[5,9] Financial Outlook - The company projects full year 2025 revenue growth of 12% to 13%[17] - The company anticipates a full year 2025 adjusted EBITDA margin of approximately 23%[17] Long-Term Financial Targets - The company targets an average annual subscription revenue growth of approximately 15%[20] - The company aims for an average annual adjusted EBITDA margin expansion of approximately 360 basis points[20]

Q2 Holdings, Inc. Second Quarter 2025 Financial Results Announcement Q2 Holdings, Inc. announces its second quarter 2025 financial results, highlighting key performance and future outlook [Executive Summary](index=1&type=section&id=Executive%20Summary) Q2 Holdings reported solid Q2 2025 financial results, driven by strong sales, renewals, and demand for risk and fraud solutions, with confidence in profitable growth - Q2 finished the first half of the year with solid sales execution and financial results[5](index=5&type=chunk) - Second quarter bookings included meaningful renewals and expansions, underscoring the long-term value of the platform[5](index=5&type=chunk) - Continued demand for risk and fraud solutions was observed[5](index=5&type=chunk) - CEO Matt Flake expressed confidence in delivering on the profitable growth strategy for the remainder of the year[5](index=5&type=chunk) [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%20Highlights) Q2 Holdings achieved strong financial performance and significant operational milestones in Q2 2025, driven by customer engagement and innovation [Financial Performance](index=1&type=section&id=Financial%20Performance) Q2 Holdings reported strong Q2 2025 financial performance, with revenue up 13% year-over-year, a swing to GAAP net income, and significantly increased Adjusted EBITDA Q2 2025 Key Financial Performance Metrics | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Q1 2025 (in millions) | YoY Change | | :-------------------- | :-------- | :-------- | :-------- | :--------- | | Revenue | 195.1 | 172.9 | 189.5 | +13% | | GAAP Gross Margin | 53.6% | 50.2% | 53.2% | +3.4 pp | | GAAP Net Income (Loss) | 11.8 | (13.1) | 4.8 | N/A (swing to profit) | | Non-GAAP Gross Margin | 57.5% | 55.7% | 57.9% | +1.8 pp | | Adjusted EBITDA | 45.8 | 29.9 | 40.7 | +53.2% | - Revenue of **$195.1 million**, up **13 percent** year-over-year and **3 percent** from first quarter 2025[8](index=8&type=chunk) - GAAP net income of **$11.8 million** compared to GAAP net loss of **$13.1 million** for the prior-year quarter[8](index=8&type=chunk) - Adjusted EBITDA of **$45.8 million**, up from **$29.9 million** for the prior-year quarter[8](index=8&type=chunk) [Operational Achievements](index=1&type=section&id=Operational%20Achievements) Q2 achieved operational milestones including six Tier 1 contracts, **13%** Subscription ARR growth to **$716.0 million**, and a **21%** increase in total committed Backlog to **~$2.4 billion** - Signed six Tier 1 contracts in the quarter, including expansion agreements with Top 100 U.S. banks for retail digital banking and relationship pricing, and new digital banking contracts[9](index=9&type=chunk) Key Operational Metrics | Metric | Q2 2025 | YoY Change | Sequential Change | | :-------------------------------- | :-------- | :--------- | :---------------- | | Subscription Annualized Recurring Revenue (ARR) (in millions) | $716.0 | +13% | N/A | | Total Committed Backlog (in billions) | ~$2.4 | +21% | +3% | - Remaining Performance Obligations total, or Backlog, increased by **$61 million** sequentially and **$403 million** year-over-year[9](index=9&type=chunk) [Customer Engagement and Innovation](index=1&type=section&id=Customers%20Remain%20Focused%20on%20Investing%20In%20Strategic%20Digital%20Initiatives%20at%20Q2's%20Annual%20Customer%20Conference) Q2's CONNECT conference saw record attendance, highlighting customer focus on fraud mitigation, commercial banking innovation, and platform extensibility, showcasing new ERP integration and **Q2 Innovation Studio** adoption - Q2 hosted its highest-attended CONNECT customer conference to date, with customers underscoring increasing focus on fraud mitigation, commercial banking innovation, and platform extensibility[7](index=7&type=chunk) - Fraud and risk innovation was a key focus, with Q2 positioning its single-platform architecture as a key differentiator in fraud prevention[8](index=8&type=chunk)[10](index=10&type=chunk) - Q2 introduced a new direct ERP integration product designed to enhance automation, security, and reconciliation for commercial banking[11](index=11&type=chunk) - Over **85%** of Q2's digital banking customers now leverage **Q2 Innovation Studio**, demonstrating outcomes like over **50%** reduction in account takeover fraud and significant customer support deflection through AI-powered chat tools[12](index=12&type=chunk) [Financial Outlook](index=2&type=section&id=Financial%20Outlook) Q2 Holdings is raising its full-year guidance for revenue, adjusted EBITDA, and free cash flow conversion, reflecting strong performance and efficient scaling [CFO Commentary and Guidance Update](index=2&type=section&id=CFO%20Commentary%20and%20Guidance%20Update) CFO Jonathan Price noted a strong quarter with revenue and adjusted EBITDA above guidance, leading to raised full-year guidance for revenue, adjusted EBITDA, and free cash flow conversion - Q2 delivered another strong quarter, with revenue and adjusted EBITDA results above the high end of guidance[13](index=13&type=chunk) - Full-year guidance is being raised across revenue, adjusted EBITDA, and free cash flow conversion[13](index=13&type=chunk) [Third Quarter 2025 Guidance](index=2&type=section&id=Q2%20Holdings%20is%20providing%20guidance%20for%20the%20third%20quarter%20of%202025%20as%20follows) For Q3 2025, Q2 Holdings expects total revenue between **$196.0 million** and **$200.0 million**, representing **12% to 14%** year-over-year growth, and Adjusted EBITDA between **$44.0 million** and **$47.0 million** Q3 2025 Financial Guidance | Metric | Q3 2025 Guidance (in millions) | YoY Growth | | :---------------- | :----------------- | :--------- | | Total Revenue | $196.0 - $200.0 | 12% - 14% | | Adjusted EBITDA | $44.0 - $47.0 | N/A | - Adjusted EBITDA is expected to represent **22 to 24 percent** of revenue for the quarter[16](index=16&type=chunk) [Full-Year 2025 Guidance](index=2&type=section&id=Q2%20Holdings%20is%20providing%20updated%20guidance%20for%20the%20full-year%202025%20as%20follows) Q2 Holdings updated its full-year 2025 guidance, projecting total revenue between **$783.0 million** and **$788.0 million** (**12% to 13%** year-over-year growth) and Adjusted EBITDA between **$177.0 million** and **$181.0 million** Full-Year 2025 Financial Guidance | Metric | Full-Year 2025 Guidance (in millions) | YoY Growth | | :---------------- | :---------------------- | :--------- | | Total Revenue | $783.0 - $788.0 | 12% - 13% | | Adjusted EBITDA | $177.0 - $181.0 | N/A | - Adjusted EBITDA is expected to represent **23 percent** of revenue for the year[16](index=16&type=chunk) [Conference Call Details](index=2&type=section&id=Conference%20Call%20Details) Details for the Q2 Holdings, Inc. second quarter 2025 financial results conference call are provided, including date, time, hosts, and registration links Conference Call Information | Detail | Information | | :--- | :--- | | Date: | Wednesday, July 30, 2025 | | Time: | 5:00 p.m. EDT | | Hosts: | Matt Flake, Chairman & CEO / Jonathan Price, CFO / Kirk Coleman, President | | Conference Call Registration: | https://registrations.events/direct/Q4I60810257 | | Webcast Registration: | https://events.q4inc.com/attendee/591091412 | - All participants must register using the provided links, and an archived replay of the webcast will be available on the investor relations website[17](index=17&type=chunk) [About Q2 Holdings, Inc.](index=3&type=section&id=About%20Q2%20Holdings%2C%20Inc.) Q2 Holdings, Inc. is a leading provider of digital transformation solutions for financial services, headquartered in Austin, Texas, and publicly traded on the NYSE - Q2 is a leading provider of digital transformation solutions for financial services, serving banks, credit unions, alternative finance companies, and fintechs in the U.S. and internationally[18](index=18&type=chunk) - The company enables its customers to provide comprehensive, data-driven digital engagement solutions for consumers, small businesses, and corporate clients[18](index=18&type=chunk) - Headquartered in Austin, Texas, Q2 is publicly traded on the NYSE under the stock symbol QTWO[18](index=18&type=chunk) [Use of Non-GAAP Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20Measures) This section defines and explains the rationale for Q2's use of non-GAAP financial measures, along with their adjustments and limitations [Definition and Rationale](index=3&type=section&id=Definition%20and%20Rationale) Q2 uses non-GAAP financial measures, such as adjusted EBITDA and non-GAAP gross margin, which management believes are useful for evaluating core operating performance by excluding items not indicative of core business - Q2 uses non-GAAP measures like adjusted EBITDA, non-GAAP gross margin, and non-GAAP

Core Viewpoint - Q2 Metals Corp. has amended its agreement with Canaccord Genuity Corp. to increase the size of its private placement to raise gross proceeds of $21,000,000 through the issuance of flow-through shares at a price of $1.00 per share [1] Group 1: Offering Details - The Offering will consist of 21,000,000 common shares, including 20,000,000 LIFE FT Shares and 1,000,000 Non-LIFE FT Shares [1] - The Agent has an option to sell an additional 5,000,000 LIFE FT Shares, potentially raising up to $5,000,000 more [1] - The Offering is expected to close on or about August 14, 2025, subject to regulatory approvals [4] Group 2: Use of Proceeds - The gross proceeds from the sale of FT Shares will be used to incur eligible Canadian exploration expenses related to the Company's projects in Québec, with a deadline for incurring these expenses by December 31, 2026 [3] - The Company will renounce all qualifying expenditures in favor of the subscribers effective December 31, 2025 [3] Group 3: Company Overview - Q2 Metals is focused on the Cisco Lithium Project in Québec, which consists of 801 claims covering 41,253 hectares [9] - The Cisco Project has an initial exploration target estimating potential lithium mineralization of 215 to 329 million tonnes at grades ranging from 1.0% to 1.38% Li2O [10] - Ongoing drill testing at the Cisco Mineralized Zone shows potential for significant expansion, with results expected in Q3 2025 [11]

Core Viewpoint - Q2 Metals Corp. has announced an inaugural Exploration Target for the Cisco Lithium Project, estimating potential mineralization between 215 to 329 million tonnes at a grade of 1.0 to 1.38% Li2O, marking a significant milestone for the company in the lithium sector [2][3][11]. Exploration Target Details - The Exploration Target for the Cisco Project is conceptual, based on limited geological evidence, and does not yet define a Mineral Resource as per NI 43-101 standards [3][4]. - The estimated range of lithium mineralization is derived from the first 40 drill holes, totaling 16,167.8 meters, with ongoing drilling expected to expand this target [6][5]. - The Exploration Target is confined to the currently defined Mineralized Zone, with additional prospective geology outside this zone potentially increasing the overall lithium endowment [7][17]. Geological and Methodological Insights - The Exploration Target was developed by BBA Inc., an independent geological consulting firm, utilizing data from 40 diamond core drill holes and 3D modeling of pegmatite domains [13][15]. - The methodology included a review of geological data, specific gravity measurements, and adjustments for confidence factors to estimate tonnage and grade [15][16]. Future Plans and Expectations - The company is continuing its 2025 Summer Program, with rolling assay results expected into Q3 2025, aiming to update the Exploration Target to a NI 43-101 compliant inferred Mineral Resource Estimate [6][23]. - The location of the Cisco Project within the James Bay Lithium District, near infrastructure such as the Billy Diamond Highway and rail access, positions it favorably for future development [11][20].