NYSE$QTWO

Q2 Holdings Inc · Q2 2021 earnings

Q2 2021 earnings · · Investor relations

Briefing

Announced second quarter 2021 financial results.

Q2 Holdings reported a solid financial performance in the second quarter, exceeding revenue and adjusted EBITDA guidance. The company had key wins in digital banking, lending, and banking-as-a-service and launched Q2 Innovation Studio to bring innovation to customers faster and differentiate offerings.

  • Revenue for the second quarter was $123.6 million, up 27% year-over-year.
  • GAAP gross margin for the second quarter was 44.8%.
  • GAAP net loss for the second quarter was $30.1 million.
  • Adjusted EBITDA for the second quarter was $9.9 million.

Headline financials

Total Revenue

$124M

Previous: $97.6M+26.6%
EPS (adj)

$0.09

Previous: $0.07+28.6%
GAAP Gross Margin

44.8%

Previous: 45.5%-1.5%
Adjusted EBITDA

$9.9M

Previous: $8.1M+22.2%
Capital Expenditures

-$14.4M

Previous: -$14.8M+2.7%
Free Cash Flow

-$44.5M

Previous: -$53.7M+17.2%
Net Income

-$30.1M

Previous: -$39M+22.7%
Operating Income

-$19.9M

Previous: -$32.3M+38.3%
Gross Profit

$55.3M

Previous: $44.4M+24.7%
Cash & Equivalents

$318M

Previous: $376M-15.5%
Total Assets

$1.38B

Previous: $1.28B+8.0%
Stock-Based Comp

$13.9M

Previous: $11.2M+24.4%

Revenue & EPS history

Q2 · Revenue · Quarterly

$124M

Q2 2021+26.6%vs Q2 2020
Beat estimate in 12 of 16 quarters(75%)
ActualEstimate

Forward guidance

Q2 Holdings is providing guidance for its third quarter of 2021 and revised guidance for its full-year 2021. Total non-GAAP revenue of $125.0 million to $126.5 million. Adjusted EBITDA of $6.2 million to $6.8 million.

Tailwinds

  • Total non-GAAP revenue of $125.0 million to $126.5 million, which would represent year-over-year growth of 19 percent to 21 percent.
  • Adjusted EBITDA of $6.2 million to $6.8 million.
  • Total non-GAAP revenue of $497.5 million to $499.5 million, which would represent year-over-year growth of 22 to 23 percent.
  • Adjusted EBITDA of $33.2 million to $34.7 million, representing 7 percent of non-GAAP revenue for the year.
  • Given the state of our pipeline across the business, we're optimistic that deal activity will begin to return to pre-pandemic levels in the back half of the year.

Headwinds

  • Government actions or other factors continue to negatively impact or disrupt the markets for Q2's solutions and that the markets for Q2's solutions do not return to normal or grow as anticipated, in particular with respect to Tier 1 customers and Alt-FI and fintech customers
  • Changes in Q2's market, business or sales organization negatively impact its ability to sell its products and services
  • Errors, interruptions or delays in Q2's products or services or Web hosting negatively impacts Q2's business and sales
  • Cyberattacks, data breaches and breaches of security measures within Q2's products, systems and infrastructure or the products, systems and infrastructure of third parties upon which Q2 relies and the resultant costs and liabilities and harm to Q2's business and reputation and its ability to sell its products and services
  • The impact that a slowdown in the economy, financial markets and credit markets may have on Q2's customers and Q2's business sales cycles, prospects and customers’ spending decisions and timing of implementation decisions, particularly in regions where a significant number of Q2's customers are concentrated

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2021

Historical avgQ2 2021

+3.7%

Avg return

Earnings day

+2.8%

Avg return

5 days after

+2.2%

Avg return

30 days after

65%

31 / 48 earnings

Positive

+18.5%

Q3 2024

Best reaction

-8.2%

Q3 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+2.8%-0.3%-9.9%
Q4 2025-7.4%-7.1%-14.7%
Q3 2025+15.3%+20.1%+20.3%
Q1 2025+13.1%+15.5%+13.6%
Q4 2024+0.9%+1.8%-17.6%
Q3 2024+18.5%+18.4%+28.6%
Q2 2024+5.5%-1.9%+11.7%
Q1 2024+15.9%+19.7%+18.3%
Q4 2023+9.1%+10.6%+21.9%
Q3 2023+9.9%+11.9%+24.9%
Q2 2023-6.2%-4.5%-1.7%
Q1 2023+12.1%+9.6%+24.9%
Q4 2022-2.3%-5.6%-31.6%
Q3 2022-8.2%+7.7%-4.2%
Q2 2022+0.1%-2.3%-15.8%
Q1 2022-4.7%-12.3%-0.3%
Q4 2021+4.6%-1.3%-3.8%
Q3 2021+14.3%+13.2%-5.6%
Q2 2021-6.1%-11.2%-7.9%
Q1 2021-3.5%-6.2%-3.2%
Q4 2020-6.5%-7.7%-27.1%
Q3 2020+7.6%+10.8%+24.5%
Q2 2020+5.3%-4.5%-4.8%
Q1 2020+5.9%+2.1%+5.5%
Q4 2019+2.1%-4.6%-36.6%
Q3 2019-0.8%+7.1%+17.6%
Q2 2019+15.2%+15.5%+17.2%
Q1 2019-6.3%-2.0%-4.9%
Q4 2018+4.0%+3.9%+6.2%
Q3 2018+3.7%+1.6%-1.0%
Q2 2018-3.2%-1.9%+2.8%
Q1 2018+10.2%+9.2%+14.1%
Q4 2017+3.8%+5.8%+8.8%
Q3 2017-3.8%-1.3%-2.7%
Q2 2017-2.5%-2.7%+4.7%
Q1 2017-1.0%-1.3%+3.5%
Q4 2016+12.1%+13.2%+13.2%
Q3 2016-3.7%+5.5%+2.0%
Q2 2016-5.1%-14.2%-5.5%
Q1 2016+6.7%
Q4 2015+13.3%
Q3 2015+10.6%
Q2 2015+1.7%
Q1 2015+13.8%
Q4 2014+7.4%
Q3 2014-7.1%
Q2 2014+9.1%
Q1 2014+2.4%
Q4 2013
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012

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