8-K: Qualys Q3 Revenue Jumps 10%, Raises Full-Year Outlook

Qualys, Inc. announced strong third quarter 2025 financial results with a 10% year-over-year revenue increase and raised its full-year 2025 revenue and EPS guidance.

Summary

• Revenues for Q3 2025 increased by 10% to $169.9 million, up from $153.9 million in Q3 2024.
• GAAP net income for Q3 2025 rose 9% to $50.3 million, or $1.39 per diluted share, compared to $46.2 million, or $1.24 per diluted share, in Q3 2024.
• Non-GAAP net income for Q3 2025 was $67.4 million, or $1.86 per diluted share, up from $58.0 million, or $1.56 per diluted share, in Q3 2024.
• Adjusted EBITDA increased by 19% to $82.6 million in Q3 2025, with a margin of 49% of revenues.
• Operating cash flow for Q3 2025 surged by 48% to $90.4 million, representing 53% of revenues.
• Qualys received FedRAMP High Authorization for its GovCloud Platform, enhancing its ability to serve federal agencies.
• The company unveiled a marketplace of agentic AI-powered agents to automate cyber risk operations.
• Qualys earned two Pwnie Awards for Epic Achievement and Best Remote Code Execution, recognizing its Threat Research Unit.
• Leadership recognitions were received from IDC MarketScape, GigaOm Radar, Gartner Market Guide, and KuppingerCole Leadership Compass.
• Full-year 2025 revenue guidance was raised to a range of $665.8 million to $667.8 million, representing 10% growth over 2024, up from the previous range of $656.0 million to $662.0 million.
• Full-year 2025 GAAP net income per diluted share guidance was raised to $5.23 to $5.30, up from $4.47 to $4.77.
• Full-year 2025 non-GAAP net income per diluted share guidance was raised to $6.93 to $7.00, up from $6.20 to $6.50.

Sentiment

Score: 8

Explanation: The company reported strong Q3 financial results with significant year-over-year growth across key metrics, including revenue, profitability, and cash flow. The upward revision of full-year guidance for both revenue and EPS indicates positive momentum and management confidence. Strategic business achievements like FedRAMP authorization and AI innovation further bolster a positive outlook.

Positives

• Strong revenue growth of 10% year-over-year in Q3 2025 to $169.9 million.
• Significant increase in GAAP gross profit by 14% to $142.1 million, with GAAP gross margin improving to 84% from 81%.
• Non-GAAP gross profit increased by 13% to $144.9 million, with non-GAAP gross margin improving to 85% from 83%.
• GAAP operating income grew by 33% to $60.0 million, with operating income as a percentage of revenues rising to 35% from 29%.
• Non-GAAP operating income increased by 21% to $80.0 million, with operating income as a percentage of revenues rising to 47% from 43%.
• GAAP net income per diluted share increased to $1.39 from $1.24 year-over-year.
• Non-GAAP net income per diluted share increased to $1.86 from $1.56 year-over-year.
• Adjusted EBITDA increased by 19% to $82.6 million, with Adjusted EBITDA as a percentage of revenues improving to 49% from 45%.
• Operating cash flow saw a substantial 48% increase to $90.4 million, reaching 53% of revenues.
• Full-year 2025 revenue guidance was raised, indicating stronger expected performance.
• Full-year 2025 GAAP and non-GAAP EPS guidance were significantly raised.
• Achieved FedRAMP High Authorization for GovCloud Platform, expanding market reach to federal agencies.
• Introduced agentic AI-powered agents for cyber risk operations, showcasing innovation.
• Received prestigious Pwnie Awards, validating the strength of the Threat Research Unit.
• Recognized as a leader in multiple key analyst reports (IDC MarketScape, GigaOm Radar, Gartner Market Guide, KuppingerCole Leadership Compass).

Risks

• Ability to continue developing platform capabilities and solutions as intended.
• Customer acceptance and purchase of existing and new solutions.
• Real or perceived defects, errors, or vulnerabilities in products or services.
• Ability to retain existing customers and generate new customers.
• Impact of budgeting cycles and seasonal buying patterns of customers.
• Ability to maintain government authorizations applicable to the platform.
• General market, political, economic, and business conditions globally.
• Ability to manage costs effectively with an increasing customer base and number of platform solutions.
• The market for cloud solutions for IT security and compliance not increasing at the expected rate.
• Competition from other products and services.
• Fluctuations in currency exchange rates.
• Unexpected fluctuations in effective income tax rate on a GAAP and non-GAAP basis.
• Ability to effectively manage rapid growth and anticipate future market needs and opportunities.
• Any unanticipated accounting charges.

Future Outlook

Management expects Q4 2025 revenues to be in the range of $172.0 million to $174.0 million, representing 8% to 9% growth year-over-year. GAAP net income per diluted share for Q4 is projected between $1.26 and $1.33, and non-GAAP net income per diluted share between $1.73 and $1.80. For the full year 2025, revenues are now expected to be $665.8 million to $667.8 million (10% growth), an increase from previous guidance. Full-year GAAP net income per diluted share is raised to $5.23 to $5.30, and non-GAAP net income per diluted share to $6.93 to $7.00.

Management Comments

• "In Q3, we continued to execute well, demonstrated by another quarter of solid revenue growth and profitability."
• "Qualys continuous innovation, early Risk Operations Center deployments, strategic wins with major federal and state agencies, momentum in partner-led initiatives, and the initial adoption of our flexible platform pricing model collectively underscore Qualys strength in unifying risk management workflows, reducing operational complexity for customers, and addressing today's toughest security challenges."
• "We believe these achievements not only validate our ongoing investments but also position Qualys as a trusted leader in pre-breach cyber risk management, setting the stage for durable growth and long-term success."

Industry Context

Qualys' strong performance, particularly in cloud-based IT, security, and compliance solutions, aligns with the growing demand for robust cybersecurity measures and cloud adoption across industries. The FedRAMP High Authorization and strategic wins with government agencies highlight the increasing importance of secure cloud platforms in the public sector. The introduction of AI-powered agents for cyber risk operations reflects a broader industry trend towards automation and advanced analytics to combat evolving cyber threats. The company's recognition in various analyst reports reinforces its competitive standing in the cloud security and exposure management markets, which are experiencing significant growth.

Comparison to Industry Standards

• Qualys' 10% revenue growth is solid within the cybersecurity sector, which often sees varying growth rates depending on sub-segments. Companies like CrowdStrike (CRWD) and Zscaler (ZS) have historically shown higher growth, but Qualys' profitability metrics (e.g., 49% Adjusted EBITDA margin) are often superior, indicating efficient operations.
• The FedRAMP High Authorization for its GovCloud Platform positions Qualys favorably against competitors in the federal market, as this is a rigorous standard few achieve. This could lead to increased market share in government contracts, similar to how Palo Alto Networks (PANW) or Fortinet (FTNT) secure large enterprise and government deals.
• Leadership recognitions in IDC MarketScape (CNAPP and Exposure Management), GigaOm Radar (Patch Management and CNAPP), Gartner Market Guide (CNAPP), and KuppingerCole Leadership Compass (API Security) indicate strong product positioning and competitive advantage in critical areas of cloud security, comparable to how leaders like Wiz or Lacework are recognized in CNAPP, or Tenable in exposure management.

Management Changes

Stakeholder Impact

• Shareholders: Positive impact due to strong financial performance, increased profitability, robust cash flow, and raised full-year guidance, potentially leading to increased share value.
• Customers: Enhanced value proposition through continuous innovation, new AI-powered solutions, and expanded capabilities like FedRAMP High Authorization, improving security and compliance offerings.
• Employees: Positive impact from company growth and strategic advancements, potentially leading to increased opportunities and stability.
• Government Agencies: Direct benefit from FedRAMP High Authorization, enabling Qualys to better support civilian, defense, and intelligence agencies in strengthening cyber resilience.

Next Steps

• Qualys will host a conference call and live webcast on November 4, 2025, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to discuss its third quarter financial results.

Key Dates

Recommendation

Qualys delivered exceptional Q3 2025 results, significantly exceeding expectations with robust revenue growth, substantial improvements in profitability margins (GAAP and non-GAAP), and a remarkable surge in operating cash flow. The decision to raise full-year revenue and EPS guidance underscores strong operational execution and positive forward momentum. Strategic achievements, such as FedRAMP High Authorization and the introduction of AI-powered agents, position the company favorably in a growing cybersecurity market. These factors, combined with strong analyst recognition, suggest continued outperformance and make Qualys a compelling 'strong buy' for investors seeking exposure to a high-growth, profitable cybersecurity leader.

Keywords

Cybersecurity, Cloud Security, IT Security, Compliance Solutions, Risk Management, Vulnerability Management, SaaS Security, Enterprise TruRisk Platform, FedRAMP, AI-powered agents, Financial Results, Earnings, Guidance, QLYS