Qualys(US:QLYS)2024-02-08 21:10Financial Data and Key Metrics Changes - The company reported Q4 revenues of $144.6 million, representing a 10% growth year-over-year, with a 13% revenue growth for the full year 2023 and a 47% adjusted EBITDA margin [31][32][39] - Adjusted EBITDA for Q4 was $65.8 million, reflecting a 46% margin compared to a 42% margin a year ago [36] - Free cash flow for the full year 2023 was $235.8 million, representing a 43% margin compared to 37% in the prior year [50] Business Line Data and Key Metrics Changes - The Patch Management and CyberSecurity Asset Management combined accounted for 12% of total bookings and 22% of new bookings in 2023 [35] - VMDR adoption reached 56% of customers worldwide, with steady growth in customer spending of $500,000 or more, which grew 14% year-over-year to 183 customers [29][12] Market Data and Key Metrics Changes - International revenue growth was 13%, outpacing domestic growth of 9%, with expectations for a revenue mix of approximately 60% US and 40% international in 2024 [33] - The channel partners contributed 44% of revenues in Q4, up from 42% a year ago, indicating a shift towards channel-driven growth [32] Company Strategy and Development Direction - The company is focused on disruptive innovation and expanding its platform capabilities, particularly through the Enterprise TruRisk platform, which aims to help security leaders measure and eliminate cyber risk [28][30] - The strategy includes increasing investments in sales and marketing, particularly in channel partnerships, to drive growth and enhance market position [60][63] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver long-term growth despite a challenging macroeconomic environment, emphasizing the importance of product innovation and strategic partnerships [54][39] - The company anticipates a stable selling environment in 2024, with ongoing budget scrutiny becoming the norm for many organizations [47][92] Other Important Information - The board authorized an additional $200 million share repurchase program, bringing the total available for repurchases to $283.7 million [37] - The company plans to align product and marketing investments to focus on specific initiatives aimed at driving more pipeline and enhancing partner programs [53] Q&A Session All Questions and Answers Question: Can you provide more detail on the strong billings growth in the quarter? - Management noted that early renewals typically do not impact revenue recognition in the quarter, as they are combined with upsells [55][77] Question: What are your expectations for gross margins in 2024? - Management indicated that the EBITDA margin for 2024 is expected to be in the low 40s, with opportunities for leverage in the model to potentially expand margins beyond this year [68][91] Question: How is the channel partner growth impacting overall margin trajectory? - Management confirmed that the increase in channel partner contributions has not significantly impacted gross margins, and they expect this trend to continue [108][134]