8-K
false 0001107843 0001107843 2021-08-09 2021-08-09

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

August 9, 2021

 

 

Qualys, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-35662   77-0534145

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

919 East Hillsdale Boulevard

Foster City, California 94404

(Address of principal executive offices, including zip code)

(650) 801-6100

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Common stock, $0.001 par value per share   QLYS   NASDAQ Stock Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 


Item 2.02

Results of Operations and Financial Condition.

On August 9, 2021, Qualys, Inc. (“Qualys”) issued a press release announcing its financial results for the quarter ended June 30, 2021. In the press release, Qualys also announced that it will hold a conference call on August 9, 2021, to discuss its financial results for the quarter ended June 30, 2021. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

This information is intended to be furnished under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit No.

  

Description

99.1    Press release issued by Qualys, Inc. dated August 9, 2021
104    Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  QUALYS, INC.
By:  

/s/ Joo Mi Kim

 

Joo Mi Kim

Chief Financial Officer

Date: August 9, 2021

EX-99.1

Exhibit 99.1

 

LOGO

Qualys Announces Second Quarter 2021 Financial Results

Revenue Growth of 12% Year-Over-Year

GAAP EPS: $0.53; Non-GAAP EPS: $0.79

Raises 2021 Revenue Guidance to $406.0-$407.5 million

Raises 2021 GAAP EPS Guidance to $1.38-$1.43

Raises 2021 Non-GAAP EPS Guidance to $3.02-$3.07

FOSTER CITY, Calif., – August 9, 2021 – Qualys, Inc. (NASDAQ: QLYS), a pioneer and leading provider of disruptive cloud-based IT, security and compliance solutions, today announced financial results for the second quarter ended June 30, 2021. For the quarter, the Company reported revenues of $99.7 million, net income under United States Generally Accepted Accounting Principles (“U.S. GAAP”) of $21.1 million, non-GAAP net income of $31.6 million, Adjusted EBITDA of $46.7 million, GAAP net income per diluted share of $0.53, and non-GAAP net income per diluted share of $0.79.

“We delivered solid results for the second quarter reflecting the power of the Qualys Cloud Platform and its associated apps to uniquely help customers secure their digital transformations and the modern work from anywhere environment,” said Sumedh Thakar, President and CEO of Qualys. “As a result, we continued to see strong customer interest and adoption of our Vulnerability Management, Detection and Response (VMDR®) application in the quarter with paid cloud agent subscriptions growing 51% year-over-year to 64 million deployed. Our innovative cloud engine continues to fire on all cylinders, our competitive position is strong, and we are making good progress advancing our go-to-market initiatives to accelerate growth and create long-term value for our shareholders.”

Second Quarter 2021 Financial Highlights

Revenues: Revenues for the second quarter of 2021 increased by 12% to $99.7 million compared to $88.8 million for the same quarter in 2020.

Gross Profit: GAAP gross profit for the second quarter of 2021 increased by 12% to $78.2 million compared to $69.9 million for the same quarter in 2020. GAAP gross margin was 78% for the second quarter of 2021 compared to 79% for the same quarter in 2020. Non-GAAP gross profit for the second quarter of 2021 increased by 12% to $80.6 million compared to $72.0 million for the same quarter in 2020. Non-GAAP gross margin was 81% for both the second quarter of 2021 and 2020.

Operating Income: GAAP operating income for the second quarter of 2021 increased by 15% to $29.4 million compared to $25.5 million for the same quarter in 2020. As a percentage of revenues, GAAP operating income was 29% for both the second quarter of 2021 and 2020. Non-GAAP operating income for the second quarter of 2021 increased by 8% to $39.6 million compared to $36.5 million for the same quarter in 2020. As a percentage of revenues, non-GAAP operating income was 40% for the second quarter of 2021 compared to 41% for the same quarter in 2020.

Net Income: GAAP net income for the second quarter of 2021 was $21.1 million, or $0.53 per diluted share, compared to $26.3 million, or $0.64 per diluted share, for the same quarter in 2020. As a percentage of revenues,


GAAP net income was 21% for the second quarter of 2021 compared to 30% for the same quarter in 2020. Non-GAAP net income for the second quarter of 2021 was $31.6 million, or $0.79 per diluted share, compared to $30.3 million, or $0.74 per diluted share, for the same quarter in 2020. As a percentage of revenues, non-GAAP net income was 32% for the second quarter of 2021 compared to 34% for the same quarter of 2020.

Adjusted EBITDA: Adjusted EBITDA for the second quarter of 2021 increased by 9% to $46.7 million compared to $42.8 million for the same quarter in 2020. As a percentage of revenues, Adjusted EBITDA was 47% for the second quarter of 2021 compared to 48% for the same quarter in 2020.

Operating Cash Flow: Operating cash flow for the second quarter of 2021 increased by 86% to $54.4 million compared to $29.2 million for the same quarter in 2020. As a percentage of revenues, operating cash flow was 55% for the second quarter of 2021 compared to 33% for the same quarter in 2020.

Second Quarter 2021 Business Highlights

 

   

Sumedh Thakar, a long-standing Qualys executive, named CEO after previously serving as Interim CEO, and Allan Peters appointed as Chief Revenue Officer to deliver sustainable customer value and business outcomes, lead the global sales and partner organization, and accelerate Qualys’ growth momentum.

 

   

Qualys VMDR® selected by deepwatch to power the Managed Security Service Provider’s (MSSP) Managed Vulnerability Services offering and provide its customers with one click-access to additional Qualys solutions such as File Integrity Monitoring, Patch Management, and Multi-Vector Endpoint Detection and Response (EDR).

 

   

Introduced Cybersecurity Asset Management (CSAM), which leverages vital context from the Qualys Cloud Platform to help security teams inventory their complete IT ecosystem, detect security gaps, and respond to risks, all from a unified platform.

 

   

Added real-time malware protection to Qualys Multi-Vector EDR to provide customers with the ability to detect and block advanced threats including ransomware.

 

   

Extended Qualys VMDR® to support the patching of Linux systems within the same platform that supports patching of Windows and third-party apps.

Financial Performance Outlook

Based on information as of today, August 9, 2021, Qualys is issuing the following financial guidance for the third quarter and full year fiscal 2021. The Company emphasizes that the guidance is subject to various important cautionary factors referenced in the section entitled “Legal Notice Regarding Forward-Looking Statements” below, including risks and uncertainties associated with the COVID-19 pandemic.

Third Quarter 2021 Guidance: Management expects revenues for the third quarter of 2021 to be in the range of $103.8 million to $104.4 million, representing 12% growth over the same quarter in 2020. GAAP net income per diluted share is expected to be in the range of $0.46 to $0.48, which assumes an effective income tax rate of 31%. Non-GAAP net income per diluted share is expected to be in the range of $0.78 to $0.80, which assumes a non-GAAP effective income tax rate of 21%. Third quarter 2021 net income per diluted share estimates are based on approximately 39.9 million weighted average diluted shares outstanding for the quarter.

Full Year 2021 Guidance: Management now expects revenues for the full year of 2021 to be in the range of $406.0 million to $407.5 million, representing 12% growth over 2020, up from the previous guidance range of $402.5 million to $404.5 million. GAAP net income per diluted share is expected to be in the range of $1.38 to $1.43, up from the previous guidance range of $1.06 to $1.11. This assumes an effective income tax rate of 28%. Non-GAAP net income per diluted share is expected to be in the range of $3.02 to $3.07, up from the previous guidance range of $2.67 to $2.72. This assumes a non-GAAP effective income tax rate of 21%. Full year 2021 net income per diluted share estimates are based on approximately 40.1 million weighted average diluted shares outstanding.


Investor Conference Call

Qualys will host a conference call and live webcast to discuss its second quarter 2021 financial results at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) on Monday, August 9, 2021. To access the conference call, dial (877) 881-2609 in the U.S. or (970) 315-0463 for international participants with conference ID #1168019. A live webcast of the earnings conference call, investor presentation and prepared remarks can be accessed at https://investor.qualys.com/events-presentations. A replay of the conference call will be available through the same webcast link following the end of the call.

Investor Contact

Blair King

Vice President, Investor Relations and Corporate Development

(650) 801-6299

ir@qualys.com

About Qualys

Qualys, Inc. (NASDAQ: QLYS) is a pioneer and leading provider of disruptive cloud-based IT, security and compliance solutions with over 19,000 active customers in more than 130 countries, including a majority of each of the Forbes Global 100 and Fortune 100. Qualys helps organizations streamline and consolidate their security and compliance solutions in a single platform and build security into digital transformation initiatives for greater agility, better business outcomes, and substantial cost savings.

The Qualys Cloud Platform and its integrated Cloud Apps deliver businesses critical security intelligence continuously, enabling them to automate the full spectrum of auditing, compliance, and protection for IT systems and web applications across on premises, endpoints, cloud, containers, and mobile environments. Founded in 1999 as one of the first SaaS security companies, Qualys has established strategic partnerships with leading cloud providers like Amazon Web Services, Microsoft Azure and the Google Cloud Platform, and managed service providers and consulting organizations including Accenture, BT, Cognizant Technology Solutions, Deutsche Telekom, DXC Technology, Fujitsu, HCL Technologies, IBM, Infosys, NTT, Optiv, SecureWorks, Tata Communications, Verizon and Wipro. The company is also a founding member of the Cloud Security Alliance. For more information, please visit www.qualys.com.

Qualys, Qualys VMDR® and the Qualys logo are proprietary trademarks of Qualys, Inc. All other products or names may be trademarks of their respective companies.


Legal Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this press release include, but are not limited to, statements related to: our confidence that our go-to-market initiatives will accelerate growth and create -long-term value for our shareholders; the benefits of our new and upcoming products, features, integrations, collaborations and joint solutions, and their impact upon our long-term growth; our guidance for revenues, GAAP EPS and non-GAAP EPS for the third quarter and full year 2021; and our expectations for the number of weighted average diluted shares outstanding and the GAAP and non-GAAP effective income tax rate for the third quarter and full year 2021. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include our ability to continue to develop platform capabilities and solutions; the ability of our platform and solutions to perform as intended; customer acceptance and purchase of our existing solutions and new solutions; real or perceived defects, errors or vulnerabilities in our products or services; our ability to retain existing customers and generate new customers; the budgeting cycles and seasonal buying patterns of our customers; the length of our sales cycle; the impact of the ongoing COVID-19 pandemic and related public health measures on our business and the global economy; our ability to manage costs as we increase our customer base and the number of our platform solutions; the market for cloud solutions for IT security and compliance not increasing at the rate we expect; competition from other products and services; fluctuations in currency exchange rates; unexpected fluctuations in our effective income tax rate on a GAAP and non-GAAP basis; our ability to effectively manage our rapid growth and our ability to anticipate future market needs and opportunities; any unanticipated accounting charges; and general market, political, economic and business conditions in the United States as well as globally. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, filed with the Securities and Exchange Commission on August 9, 2021.

The forward-looking statements in this press release are based on information available to Qualys as of the date hereof, and Qualys disclaims any obligation to update any forward-looking statements, except as required by law.

Non-GAAP Financial Measures

In addition to reporting financial results in accordance with GAAP, Qualys provides investors with certain non-GAAP financial measures, including non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP net income per diluted share, Adjusted EBITDA (defined as earnings before interest expense, interest income and other income (expense), net, income taxes, depreciation, amortization, and stock-based compensation) and non-GAAP free cash flows (defined as cash provided by operating activities less purchases of property and equipment (net of proceeds from disposal) and principal payments under finance lease obligations).

In computing non-GAAP financial measures, Qualys excludes the effects of stock-based compensation expense, and amortization of intangible assets from acquisitions. Qualys believes that these non-GAAP financial measures help illustrate underlying trends in its business that could otherwise be masked by the effect of the income or expenses, as well as the related tax effects, that are excluded in non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP net income per diluted share, Adjusted EBITDA and non-GAAP free cash flows.

Furthermore, Qualys uses some of these non-GAAP financial measures to establish budgets and operational goals for managing its business and evaluating its performance. Qualys believes that non-GAAP gross profit, non-GAAP


gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP net income per diluted share, Adjusted EBITDA and non-GAAP free cash flows provide additional tools for investors to use in comparing its recurring core business operating results over multiple periods with other companies in its industry.

Although Qualys does not focus on quarterly billings, Qualys provides calculated current billings (defined as total revenues recognized in a period plus the sequential change in current deferred revenue in the corresponding period) to assist investors and analysts in assessing its operating performance.

Qualys has not reconciled non-GAAP net income per diluted share guidance to GAAP net income per diluted share guidance because Qualys does not provide guidance on the various reconciling cash and non-cash items between GAAP net income and non-GAAP net income (i.e., stock-based compensation and amortization of intangible assets from acquisitions). The actual dollar amount of reconciling items in the third quarter and full year 2021 is likely to have a significant impact on the Company’s GAAP net income per diluted share in the third quarter and full year 2021. A reconciliation of the non-GAAP net income per diluted share guidance to the GAAP net income per diluted share guidance is not available without unreasonable effort.

In order to provide a more complete picture of recurring core operating business results, the Company’s non-GAAP net income and non-GAAP net income per diluted share include tax adjustments required to achieve the effective income tax rate on a non-GAAP basis, which could differ from the GAAP effective income tax rate. The Company believes its estimated non-GAAP effective income tax rate of 21% in 2021 is a reasonable estimate under its global operating structure. The Company may adjust this rate during the year to take into account events or trends that it believes materially impact the estimated annual rate. The non-GAAP effective income tax rate could be subject to change for a number of reasons, including but not limited to, significant changes resulting from tax legislation, material changes in geographic mix of revenues and expenses and other significant events.

The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release to the most directly comparable GAAP financial measures is included with the financial statements contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating its business internally and as such has determined that it is important to provide this information to investors.


Qualys, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except per share data)

 

     Three Months Ended
June 30,
     Six Months Ended
June 30,
 
     2021     2020      2021     2020  

Revenues

   $ 99,702     $ 88,830      $ 196,458     $ 175,093  

Cost of revenues (1)

     21,552       18,891        43,232       37,386  
  

 

 

   

 

 

    

 

 

   

 

 

 

Gross profit

     78,150       69,939        153,226       137,707  

Operating expenses:

         

Research and development (1)

     19,805       18,058        37,554       36,041  

Sales and marketing (1)

     17,770       15,783        35,759       34,013  

General and administrative (1)

     11,213       10,590        53,256       21,714  
  

 

 

   

 

 

    

 

 

   

 

 

 

Total operating expenses

     48,788       44,431        126,569       91,768  
  

 

 

   

 

 

    

 

 

   

 

 

 

Income from operations

     29,362       25,508        26,657       45,939  

Other income (expense), net:

         

Interest expense

     —         —          (4     (3

Interest income

     567       1,392        1,313       3,316  

Other income (expense), net

     (80     194        (324     59  
  

 

 

   

 

 

    

 

 

   

 

 

 

Total other income, net

     487       1,586        985       3,372  
  

 

 

   

 

 

    

 

 

   

 

 

 

Income before income taxes

     29,849       27,094        27,642       49,311  

Income tax provision

     8,707       775        6,272       4,298  
  

 

 

   

 

 

    

 

 

   

 

 

 

Net income

   $ 21,142     $ 26,319      $ 21,370     $ 45,013  
  

 

 

   

 

 

    

 

 

   

 

 

 

Net income per share:

         

Basic

   $ 0.54     $ 0.67      $ 0.55     $ 1.15  
  

 

 

   

 

 

    

 

 

   

 

 

 

Diluted

   $ 0.53     $ 0.64      $ 0.53     $ 1.10  
  

 

 

   

 

 

    

 

 

   

 

 

 

Weighted average shares used in computing net income per share:

         

Basic

     39,099       39,161        39,154       39,137  
  

 

 

   

 

 

    

 

 

   

 

 

 

Diluted

     40,077       40,919        40,253       40,883  
  

 

 

   

 

 

    

 

 

   

 

 

 

(1) Includes stock-based compensation as follows:

         

Cost of revenues

   $ 841     $ 583      $ 1,716     $ 1,197  

Research and development

     2,582       3,253        4,797       6,690  

Sales and marketing

     1,086       1,513        2,714       3,073  

General and administrative

     4,044       4,095        37,528       8,481  
  

 

 

   

 

 

    

 

 

   

 

 

 

Total stock-based compensation

   $ 8,553     $ 9,444      $ 46,755     $ 19,441  
  

 

 

   

 

 

    

 

 

   

 

 

 


Qualys, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands)

 

     June 30,
2021
    December 31,
2020
 

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 97,278     $ 74,132  

Short-term marketable securities

     262,941       281,892  

Accounts receivable, net

     86,044       100,179  

Prepaid expenses and other current assets

     21,979       19,142  
  

 

 

   

 

 

 

Total current assets

     468,242       475,345  

Long-term marketable securities

     110,890       98,458  

Property and equipment, net

     65,959       64,850  

Operating leases - right of use asset

     40,403       44,838  

Deferred tax assets, net

     16,469       15,811  

Intangible assets, net

     8,715       12,006  

Goodwill

     7,447       7,447  

Restricted cash

     1,200       1,200  

Other noncurrent assets

     17,980       16,864  
  

 

 

   

 

 

 

Total assets

   $ 737,305     $ 736,819  
  

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

    

Current liabilities:

    

Accounts payable

   $ 1,597     $ 731  

Accrued liabilities

     30,685       29,833  

Deferred revenues, current

     228,180       213,494  

Operating lease liabilities, current

     12,246       11,672  
  

 

 

   

 

 

 

Total current liabilities

     272,708       255,730  

Deferred revenues, noncurrent

     28,681       30,540  

Operating lease liabilities, noncurrent

     40,422       45,700  

Other noncurrent liabilities

     2,499       367  
  

 

 

   

 

 

 

Total liabilities

     344,310       332,337  

Stockholders’ equity:

    

Common stock

     39       39  

Additional paid-in capital

     424,507       401,359  

Accumulated other comprehensive loss

     (265     (484

Retained earnings (accumulated deficit)

     (31,286     3,568  
  

 

 

   

 

 

 

Total stockholders’ equity

     392,995       404,482  
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 737,305     $ 736,819  
  

 

 

   

 

 

 


Qualys, Inc.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

(in thousands)

 

     Six Months Ended
June 30,
 
     2021     2020  

Cash flow from operating activities:

    

Net income

   $ 21,370     $ 45,013  

Adjustments to reconcile net income to net cash provided by operating activities:

    

Depreciation and amortization expense

     17,869       15,633  

Bad debt expense

     152       299  

Loss on disposal of property and equipment

     12       —    

Stock-based compensation

     46,755       19,441  

Amortization of premiums (accretion of discounts) on marketable securities

     2,029       (21

Deferred income taxes

     (722     1,269  

Changes in operating assets and liabilities:

    

Accounts receivable

     13,983       1,797  

Prepaid expenses and other assets

     (6,014     (6,725

Accounts payable

     947       220  

Accrued liabilities

     3,032       (972

Deferred revenues

     12,827       5,695  
  

 

 

   

 

 

 

Net cash provided by operating activities

     112,240       81,649  
  

 

 

   

 

 

 

Cash flow from investing activities:

    

Purchases of marketable securities

     (201,411     (162,912

Sales and maturities of marketable securities

     205,143       164,109  

Purchases of property and equipment

     (12,911     (11,568

Proceeds from disposal of property and equipment

     6       —    
  

 

 

   

 

 

 

Net cash used in investing activities

     (9,173     (10,371
  

 

 

   

 

 

 

Cash flow from financing activities:

    

Repurchase of common stock

     (63,252     (54,182

Proceeds from exercise of stock options

     4,438       20,430  

Payments for taxes related to net share settlement of equity awards

     (21,017     (11,115

Principal payments under finance lease obligations

     (90     (61
  

 

 

   

 

 

 

Net cash used in financing activities

     (79,921     (44,928
  

 

 

   

 

 

 

Net increase in cash, cash equivalents and restricted cash

     23,146       26,350  

Cash, cash equivalents and restricted cash at beginning of period

     75,332       88,759  
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash at end of period

   $ 98,478     $ 115,109  
  

 

 

   

 

 

 


Qualys, Inc.

RECONCILIATION OF NON-GAAP DISCLOSURES

ADJUSTED EBITDA

(Unaudited)

(in thousands)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2021     2020     2021     2020  

Net income

   $ 21,142     $ 26,319     $ 21,370     $ 45,013  

Depreciation and amortization of property and equipment

     7,145       6,366       14,578       12,593  

Amortization of intangible assets

     1,646       1,520       3,291       3,040  

Income tax provision

     8,707       775       6,272       4,298  

Stock-based compensation

     8,553       9,444       46,755       19,441  

Other income, net

     (487     (1,586     (985     (3,372
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 46,706     $ 42,838     $ 91,281     $ 81,013  
  

 

 

   

 

 

   

 

 

   

 

 

 


Qualys, Inc.

RECONCILIATION OF NON-GAAP DISCLOSURES

(Unaudited)

(in thousands, except per share data)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2021     2020     2021     2020  

GAAP Cost of revenues

   $ 21,552     $ 18,891     $ 43,232     $ 37,386  

Less: Stock-based compensation

     (841     (583     (1,716     (1,197

Less: Amortization of intangible assets

     (1,621     (1,495     (3,241     (2,990
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Cost of revenues

   $ 19,090     $ 16,813     $ 38,275     $ 33,199  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP Gross profit

   $ 78,150     $ 69,939     $ 153,226     $ 137,707  

Plus: Stock-based compensation

     841       583       1,716       1,197  

Plus: Amortization of intangible assets

     1,621       1,495       3,241       2,990  
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Gross Profit

   $ 80,612     $ 72,017     $ 158,183     $ 141,894  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP Research and development

   $ 19,805     $ 18,058     $ 37,554     $ 36,041  

Less: Stock-based compensation

     (2,582     (3,253     (4,797     (6,690

Less: Amortization of intangible assets

     (25     (25     (50     (50
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Research and development

   $ 17,198     $ 14,780     $ 32,707     $ 29,301  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP Sales and marketing

   $ 17,770     $ 15,783     $ 35,759     $ 34,013  

Less: Stock-based compensation

     (1,086     (1,513     (2,714     (3,073
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Sales and marketing

   $ 16,684     $ 14,270     $ 33,045     $ 30,940  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP General and administrative

   $ 11,213     $ 10,590     $ 53,256     $ 21,714  

Less: Stock-based compensation

     (4,044     (4,095     (37,528     (8,481
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP General and administrative

   $ 7,169     $ 6,495     $ 15,728     $ 13,233  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP Operating expenses

   $ 48,788     $ 44,431     $ 126,569     $ 91,768  

Less: Stock-based compensation

     (7,712     (8,861     (45,039     (18,244

Less: Amortization of intangible assets

     (25     (25     (50     (50
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Operating expenses

   $ 41,051     $ 35,545     $ 81,480     $ 73,474  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP Income (loss) from operations

   $ 29,362     $ 25,508     $ 26,657     $ 45,939  

Plus: Stock-based compensation

     8,553       9,444       46,755       19,441  

Plus: Amortization of intangible assets

     1,646       1,520       3,291       3,040  
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Income from operations

   $ 39,561     $ 36,472     $ 76,703     $ 68,420  
  

 

 

   

 

 

   

 

 

   

 

 

 

GAAP Net income

   $ 21,142     $ 26,319     $ 21,370     $ 45,013  

Plus: Stock-based compensation

     8,553       9,444       46,755       19,441  

Plus: Amortization of intangible assets

     1,646       1,520       3,291       3,040  

Pus (Less): Tax adjustment

     265       (6,997     (10,048     (10,567
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Net income

   $ 31,606     $ 30,286     $ 61,368     $ 56,927  
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Net income per share:

        

Basic

   $ 0.81     $ 0.77     $ 1.57     $ 1.45  
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

   $ 0.79     $ 0.74     $ 1.52     $ 1.39  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares used in non-GAAP net income per share:

        

Basic

     39,099       39,161       39,154       39,137  
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

     40,077       40,919       40,253       40,883  
  

 

 

   

 

 

   

 

 

   

 

 

 


Qualys, Inc.

RECONCILIATION OF NON-GAAP DISCLOSURES

FREE CASH FLOWS

(Unaudited)

(in thousands)

 

     Six Months Ended
June 30,
 
     2021     2020  

GAAP Cash flows provided by operating activities

   $ 112,240     $ 81,649  

Less:

    

Purchases of property and equipment, net of proceeds from disposal

     (12,905     (11,568

Principal payments under finance lease obligations

     (90     (61
  

 

 

   

 

 

 

Non-GAAP Free cash flows

   $ 99,245     $ 70,020  
  

 

 

   

 

 

 


Qualys, Inc.

RECONCILIATION OF NON-GAAP DISCLOSURES

CALCULATED CURRENT BILLINGS

(Unaudited)

(in thousands)

 

     Three Months Ended
June 30,
 
     2021     2020  

GAAP Revenue

   $ 99,702     $ 88,830  

Plus: Current deferred revenue at June 30

     228,180       199,732  

Less: Current deferred revenue at March 31

     (218,898     (201,861
  

 

 

   

 

 

 

Non-GAAP Calculated current billings

   $ 108,984     $ 86,701  
  

 

 

   

 

 

 

Calculated current billings growth compared to same quarter of prior year

     26     7