QLYS - Earnings call transcript Q4 2024

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Operator

Good day, and thank you for standing by. Welcome to Qualys Fourth Quarter 2024 Investor Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Blair King. Please go ahead.

Blair King

Gigi. Thanks, welcome Quarter and Earnings Qualys' to afternoon, XXXX Fourth Call. Good

results today Joo Thakar, CFO. to me is Mi discuss our and Joining CEO; our Sumedh and our Kim, President

today's set that would that from statements and statements the relate call these in differ could or operating future Form to forth our that make result to press I performance. obligation include or as filings generally including started, SEC, no cause update with events. events this undertake assumptions to statements. differ financial release and a get XX-K. today will Factors of we remind Before materially our these of results materially new you our latest future we as our today, future are on Actual remarks forward-looking that information XX-Q may based on forward-looking are like and to Any or we results statements

we present earnings financial this section press During today's investor Relations the and as to reconciliation release. in website. available of our press non-GAAP A And measures. all remarks the a on will measures included presentation and prepared GAAP of Investor reminder, call, non-GAAP is release, both are GAAP

over I'd now that, like So with turn to the to call Sumedh.

Sumedh Thakar

Blair, welcome earnings Thank quarter you, and to call. fourth our

innovation Looking product anniversary. of rebranding and celebrate I a truly can XXth last as year year back Qualys year, to of say that incredible our was we XXXX

cybersecurity. SaaS security comes the exceed it first in leader the to as in market have disruptive of one serve strived technology to world, and As companies the we expectations continuously when

teams risk cybersecurity impact wants consolidating cybersecurity Boards while aspirational specific solutions best-of-breed business their into than risk to for that unified anchor them a to one. reduction their rather to vendors of the of cybersecurity XX CISOs areas spend. letting message the different in and as conversations cybersecurity platform pick want underlying market Today, around an clear. and partner their platform language speak enables The Today's business goal of the is

security implementing of for customers correlates focused utilizing net is analytics vendor-neutral have existing their from an workflow vulnerability leverage insights and scoring visibility evolved customers while security full Recognizing risk XX over full remediates security numerous vendors, entire and delivering while quantifies, previously giving become continue scanning data feeds platform and with and to leveraging surface, to embedded platform, solutions organization's quantification a tools. security multiple analytics prioritizes of risk result that bringing and on to the feature powers risk centralizes, the single complexity and cyber layer findings models consolidation. orchestration and a AI aggregates threat difficulty attack we AI-driven telemetry collection the a efficiencies and them our flexibility The provides for and to all articulates, that

patch into further previously turn opportunity. technologies enhanced market internal capabilities expand in remediation our Cybersecurity external unknown our TruRisk extend introduced and Management pending managed to with and beyond collaboration rebranding innovative The that need unwavering of XXXX, our significant In focus our a this on solutions. with continuous challenges new relevance a customers' enhancement and of management. our facing We patent capabilities time. bolster our to addressing real assets assets result Eliminate their our and Asset led enhancement is strategic platform prioritizing We to platform security

attacker Management, runtime With unified ]. Infrastructure centric Posture find ATT&CK solution, new large Cloud capabilities (sic) groundbreaking GA capabilities with Prioritization CNAPP TruRisk delivered Matrix we protection, Entitlement view. fixing Insight [ Center, operationalize container brought CIEM, Management, secure and we Qualys our generative models and went platform into MITRE models with and integration, modern SaaS Management for We applications an AI and and to platform, power our multi-cloud (sic) a learning large gold the the organically Security ITSM our language critical respond with Prioritization the further predict, our Kubernetes ROC to uniquely industry ATT&CK TotalCloud organizations [ into for We Posture TotalAI, Enterprise to cyber strengthening position planting risk of MITRE our TruRisk ] Management the Matrix platform AI-powered Operations proactive on TruRisk market new flag at Risk the setting to standard scale. risk management in and identify

we with a active interest In currently going XX less have seen than our POC. over ETM, GA since quarter prospects with for strong

effect cyber to Qualys, beyond solution their will ability of actions to Threat underwriter. goes ETM our trusted solutions. with business allow and layering on believe cybersecurity platforms language, remediation partner a other like existing our innovations customers We with standardize speak insurance Our current platform top Continuous CTEM, on Exposure Management, these

With empowering Last turn, the doesn't compensating has competitive when teams. advantage million zero-day implement deploy. most a and environment. gap cybersecurity introduced pioneered This successfully potential feasible aren't IT patching simply organizations there. why Qualys in deployed alone with the track journey is achievement, for between enough. against over not bridging incidents a or platform this misconfigurations of and over shown long to patches solving patches seamlessly cybersecurity use assets security XXX stop challenging Eliminate, -- to innovation it year, integrating challenging XXX agent record revolutionizes eliminated vulnerabilities controls, our into million the isolate Despite we which is protecting or customers, our and challenges that our available patching TruRisk and our is That cases we critical category, Qualys customer patching our and by major in

as Uninstall attack simple for TruRisk of misused of paths and forms hunt a uninstall most and introduced or a button. unused application package. while to debt highly the one recently adversaries other detect organizations Eliminate removing allows end-of-life available exploited a TruRisk TruRisk Uninstall click software, our with tech of to fourth to component We've

CISOs risk comprehensive well well. brought risk-based approach Advancing Insight positioned analysis, we to no-code, new expand we look attack to increasingly as path In and level. are environments engine into continues as competitive remediation. evolving our Cloud, the including cloud capabilities evolve We CNAPP multi-cloud TruRisk and differentiation, of many our enhanced quantification capability innovation agentless at our to agent leveraging automated low-code high our a into share our Cloud solution, market recently execute workflow believe TotalCloud

This runtime which the critical prioritize latest pre-runtime release, resolve attack unleashes we easily blast identify, an of visualize X.X entire asset's systematically call ability organization's for and to threats and protection. TotalCloud radius path and an

of Qualys streamlining result, solutions comprehensive and in unparalleled X.X CNAPP most TotalCloud and today, As X.X strong consumption. In available a market TotalCloud assurance an is for cloud the the one growing customers perspective momentum day. to secure view, of with place outside-in operations every it's posture inside-out organization our cybersecurity in testament an a is is the

Finally, with providing attack use surface now BXB and APIs with for the web and APIs with applications of unified detection expanding comprehensive malware Qualys' the the we of customers with to ability apps. TotalAppSec, into assessment includes assessments and their Qualys threat introduction of expand and TotalAppSec mobile automated AppSec are their inventory response.

update. Moving business on to

met Customers of and is a all of the terms on their of one in Over partners. cyber the to view single integrated with top past business a quantified existing personally topic. require to solutions. risk that several level These months, conversations in many risk, the customers, holistic same their workflow centered prioritized, around remediated and and an prospects articulated I acceptable

Management, Qualys' these are greater Patch areas requirements land, Cybersecurity new to to Management, for not platform VMDR Asset broader blueprint on and the fueling customers of Operations Given Qualys' but ETM delivered the adoption, Platform. with helping by only customers, especially now delivering of Cloud consolidating Risk TruRisk Qualys thousands logo value Center Enterprise our also technologies increase with in Security

wins, why tools, companies to Let quantify operations. Qualys to turning unify again their security their and are me cyber fortify which a help of share couple security in risk their these environment illustrate recent

security company First, increasing environment XXX visibility an in struggled into costs risk multiple overall tools their global profile. personnel faced existing limited team with multinational with and their insurance

brought Through ROC, enrich X-figure annual integration in collapse remediation. of data included with business modules asset purchase ETM stack, and and launched tools to and deploying chose their This by their context resulting X cybersecurity Qualys booking into fee. to initiative a the other this orchestrating the information customer CMDB an Qualys centralized a their RFP begin competitive platform, Qualys security highly ingest from process,

quickly now risk quantifiable data with numerous sources automated aligned consolidation and Qualys of outcome are the to business migrating We delivering priorities. the with platform response and

to lacked determined Application replaced mid-X-figure Scanning and assess Turning its a and this security to initiative the existing Web that tools. Assessment their incumbent missed stack solution evaluation, detection, security operations, integration moment and Cybersecurity a to its and complexity we alternative see This vendor. with to their Through booking which unify hindered VMDR, consolidate upsell cloud-only Customer TotalCloud launched XX Management, further ability Asset conglomerate. customer point security solutions and an Customer Remediation. Global CNAPP risk added its in with their

adversaries Today, through a from integration this to a detecting combine and for against and capabilities automation risk Platform preventing provide anomalies, and visibility zero-day integrated and Enterprise build remediating on-prem, to with long-term natively through insights through while closing single CNAPP necessary TruRisk the dashboard attacks, today's risk customer gaps is opportunity a runtime Qualys. management leveraging with its hybrid multi-cloud highly actively the scalable, defend solution, proactive ITSM security These across represent significant assets. Qualys

understand more our modern Qualys on and natively outcomes, challenges, are solve customers to drives time delivered solutions how cybersecurity integrated cost less. transformation seamlessly and With platform security better to saves beginning more security

QX result, customers to XXX. a with or year spending in more grew $XXX,XXX us ago As from a XX%

embraced with It's business an workflow strong mix underscored Consolidating happening also and isn't by prioritized our just customers. by growth. significant and of interestingly partners, new

rates a continued registration we deal in win partner-led motion QX. sales endorse increase As partner-first to and

are management. capitalize the Corporations, MSSPs SOC In for initiatives risk with new the approach the Similar MSSPs managed integration, time is actively Managed these quantification, platform spearheading and service for services how response, post-breach to choice. in new Qualys deeply many are frontier of security the to on security for mROC, risk to providers of delivering our now tool first mROC as new of addition, centralized Risk the a pre-breach and ETM, mROC engaged automated monitoring Partners launch their monetized encompassing with risk now patching.

for to Revenue at him at decided to his his our Turning accept has and would Chief Officer, DiMarino, Qualys. thank executive Dino congratulate contributions wish tenure I CEO like who update. well during I our Dino to another company. a team role

As ready market to the by to growth strategy, sales and grow who drive sales we continuing executing competitive forward. to leaders fortunate product-led while regional We're next-level are energized group. business sales position to the our in the a of to vision talented and and scale organization I partner-first team continue our focus on our oversee plan have

opportunity massive platform, cloud-based High continued FedRAMP the way looks High modern, excited solutions the and certification have the XXXX FedRAMP costly in federal and in remain government cost-efficient our Federal clunky done anticipating change and our we investing to management. with effective past move risk things solutions in Ready cybersecurity as to With GTM, been about for on-prem and the

In summary, in couldn't opportunities more time. for growth over confident I market be position our and

leadership clear a Qualys' delivering as is reflection value customers continuous trusted and security to transforming innovation, risk platform of to Our management. a dedication cybersecurity

and Looking disruptive continue vision our advance XXXX, innovation, growth balanced strategic execute our a to with we'll ahead investments to long-term and profitability. further our approach go-to-market

year outlook turn With and to Mi results our and full quarter to that, the the Joo first for fourth further call I'll over quarter discuss XXXX.

Joo Mi Kim

afternoon. Sumedh, good Thanks, and

year on Before comparisons financial figures non-GAAP, and that all revenue, unless to note I to like prior based rates except growth I'd are stated the otherwise. for are period, start,

to discipline to model. finish and We're continued scalable highlighting pleased financial our execution, a business year, the report healthy

full share, sales growth margin EBITDA XX% adjusted expectations XX% in and the year, free our XX% which and even of or to continued EPS to grew year. in For and for of million diluted reached per we and respectively. $XXX.X XX% XX% revenue, by $X.XX revenues marketing. of income the $XXX flow $XXX.X Net cash all million achieved million investments grew And with exceeded

Turning quarter XX% to to revenue year $XXX.X of to a up million. its compared results. fourth increase continued total ago. contribution, Revenues making The XX% channel to grew XX%

was was to commitment international and partners channel XX%, from our drive continued ahead were X%. grow our business, geo, of mix As revenues growth, ecosystem outside growth a to able By XX% X%. to result revenue rate domestic and from U.S. direct, which ongoing Reflecting retention our security within future. which partner leverage U.S. XX%, the respectively. of we in the we the grew XX% at grew the of outpacing stable With this customers in anticipate gross approximately with to XX% prioritization IT unchanged persisting expansion environment sentiment, prior confirming XXX%, for at rate selling our XXXX dollar scrutiny came in remained budgets, quarter. and QX, remain budget net our foreseeable by

contribution and of Asset and new XX% product Patch total bookings, XXXX. bookings bookings of Cybersecurity to of combined Management in Management up terms made In XX%

of Security Our remediation contextualized on bookings. workflows platform. Cloud TotalCloud our of surface management and XXXX broader attribute CNAPP, natively single integrated for to up X% needs We their across solutions, a made with the risk environments all awareness attack customers' success

our targeted was QX investments Turning profitability. XX% representing the for XX% a last process. EBITDA remained from last X% planning to optimization was stronger-than-expected flat grew margin quarter our moderately XX% part a in of sales by a while efforts, year to Adjusted of $XX.X and to quarter compared last million, operating fourth ago performance resulted from XXXX margin which XXXX relatively quarter. This expenses and Consequently, marketing quarter.

flow was XX% QX, we prior the on from million, back expenditures $XX.X cash million quarter of of continued our invest into generated million the we XX% was cash to compared Qualys, for In EPS margin shares. $XX.X in to free outstanding to XXX,XXX $X.XX, the and capital a our $X.X repurchase representing including year. fourth operations XXXX and

As million to starting in available share to that, $XXX.X We're remaining program, bringing of had of has authorized the another for that revenues. pleased our repurchases guidance, quarter, Board total increase to the program. announce we repurchase million million. With repurchase turn to with $XXX.X of the $XXX share let us the amount end our

of to X% of revenues million, a For in represents rate expect year be $XXX X%. we full growth million the the to XXXX, which to range $XXX

in first business dollar the expansion to assumes guidance growth XXXX, growth new X%. in of change we XXXX. with million of of expect contribution to revenues in $XXX.X $XXX.X rate rate to million, the be representing our quarter For from a range moderate X% no net This material

that profitability the guidance. be to realize as some will there CRO plan departure, make sharing to the given upcoming also adjustments updates progress throughout near-term we be We may and the year. Shifting

flow EBITDA the full the we to expenses in cash implying XX% margin year in low expect the margin low For in mid-XXs. increase XXXX, be operating XXs, to free to XX% and

year $X.XX full of in be to to expect We range EPS $X.XX. the

to first $X.XX XXXX, EPS the range For be of quarter $X.XX. expect in to the of we

be $X Our of first planned capital of for to in in expenditures and of the million range the $X range XXXX million the in are million $XX quarter expected to million. to $X XXXX

approximately marketing operating are anticipate in initiatives to to XXXX, and plan we our centers given to making we respect accelerating specific expanding our efficiencies With greater vertical. expenses, driving to achieve margin to X% costs. reduce data we to In and align partner some federal program at our gross on product by contract pipeline, certain operational currently our medium- aimed investments of and marginal focus investments more long-term

to more that, and in questions. prioritize marketing be in any your percentage investments a G&A. With and with happy As Sumedh revenue, of I expect to a an answer engineering we increase sales in would increase of and modest

Operator

from comes of Canaccord the question Genuity. line from Our first Kingsley Crane

William Kingsley Crane

We've have some the you for pricing of in space consumption in consolidated more customers. in great products portfolio. more simplifies of the others get can products again, so plan the the seen many that a hands and up So

opportunities So on any next creative thoughts this over year? packaging

Sumedh Thakar

Yes, great question. a that's

risk articulate third-party risk combination that that able bringing -- the looking I bringing ways think and modules by a of us, they're from business reducing looking to that wherever as script, in they data are how how are solutions I they at and that spend anchor, customers for cybersecurity can by business are spend available. their available, mentioned their at at looking really Qualys my is

of also the through right the think the we now now so something the pricing, and terms and at adopter review ETM where around an with early adopt and that be to we for ETM integration, of are how the continue for to journey rather from modules. than a of year I throughout have ETM that customers is model see feedback early that the we going, early this opportunities right from but continuing customers that look these we feedback the that, getting year packaging we them of we can product adoption amazing anchored we're are And in as POCs platform, sort both getting in evolution individual will as the and it to help

William Kingsley Crane

like That's great to departure, And sounds going sales bit to Dino's hear. it a efforts on. hands you're Sumedh, with oversee more

had as taken recently with You a more on marketing bit product and well.

hire thoughts just time the you're any the leaders on to if and plans your upcoming across balance looking So on key updated business you -- just to or year? and your wondering, how any plan bandwidth

Sumedh Thakar

the couple of a this XXXX as past, not jump our Yes. to good help with while the the Again, for and broader Dino Thank to working this planning in in I've needed. a on periodically a happy have for we being of we CRO team, but times thank place. team, done been the in you. is I'm part just and

strategy, it now execution about you a how we that the of more and seeing we our growing from and pivot partners, on as with the is key towards that on as how both partner-oriented closing little see, well engagement focus part we're is bit GTM execution. So celebrating deals, lead direct gen gen, which our can partner and with as the et a means more cetera. And pipeline execution do less focusing really our on on partners is success direct a with

and dedicated the is that mission. our the that, leadership of are they leadership. Many So continue aligning working been them connected, Dino sales With sales we I on with us, before have below think here closer to that, strong. is good Dino partners very our to executing and focus joined very even news

that. forward to look do to I so And continuing

that our as CTO, side, working on great over Management, as with I leaders with really on both the SVP driving of execution have our Bachwani, for years. product Dilip have well been here the Product our again, -- XX but capabilities And vision we think me, product more of delivering also our with will product us, is needed as encourage side aligning to not which the mROC, from side, well, just GTM from on side. partners to the like do the

the understands -- leaders be us us focus leader sure will right about we will we finding again, the it really make business, side are partner different our on focus necessarily the now, in on growing making the not we who that all sure focusing be of working and that with aspects focusing and is around who of on So the but more how partner for pivot direction. direct that going do more are our business

Operator

next Our comes question Markets. from Hedberg Capital of line Matthew from the RBC

Michael Steven Richards

think Richards Maybe to year. plan departure go motion appreciating here could But what that for or Mike we improve you kick want that and is the this for the already of This are on had could sales really I the to off Matt. that I had his year probably some Dino's exit and you've the back here? changes you a given maybe expect and your taken sales reins

Sumedh Thakar

finished and of globally, end head, helping Yes. the of last is essentially it sales Sales that's SVP year, of Product the about SVP the towards now VP and with We our Enablement. and our goals sales really Ops -- team sales 'XX for Partnerships planning then of on our manage executing

our managed these we cetera. well multiple as as of services on we hedges, can essentially the really risk with bringing mROC, this are so working our sure and to increase revenue I do the talked partner-focused bit saw with different around of on they that how partners partners how our release services but themselves a anchor do make you is quantification, as And create which we platform the with leverage how deal can little about to et that these to balance with remediation, margin actually Qualys capabilities partners, platform consolidation customers also able for focusing

this we partnership focusing started We key our we last year are year, focus sure on do business, And and how that our said, execution direct for is of some relationship that on we year, as this to -- how going bring with is us make them us, ourselves. existing which business. to potentially was customers direct last creating so really new new has for our work end we partner-led that pillars of they towards also the on logos with customers to bring we so for a our leverage partners more can where while of our opportunities execute them working

is the we're So about multiple are our that there as opportunity. something we focus are which on focusing things that a different well on as federal potential that business, excited

So from because contribution on to as continue extremely current small. execute federal the is our to that we'll business well aspect

to so And much larger there. a be there continues opportunity

the giving a are them with execution, with not direct adding services So top our there groups how lot business reduce mix we about confidence layer pivot that only us, it's rock really has bring their but potentially the them and direct friction gravitate managed our and it indirect that existing is of that by given and we global giving to well. of confidence towards which then a do been that capability, the on we can which the a partners around is enterprises by stream adds of build as seeing also significant of revenue a them

Michael Steven Richards

there's on stepping it's picking any How a TotalAI. else steam? And all seeing know going year greenfield, doing doing when talking wanted but else TotalAI? or driver what such a mean here? competitive just early there you maybe there. kind anyone terms and you're then Maybe growth Is you it in of TotalAI? Or I about dynamics else seems you're there? are big ask about just on feedback anything Great. up And who to thinking back, just like next customer then are on of there it in opportunity been I I has for

Sumedh Thakar

question. Great

to couple over of in in of you people took companies start looking more that actual that, journey of to are at of itself into a we at We the I environments. little more get LLMs. bit years, 'XX, as AI place at the think if a around And QX. think and I see starting leveraging many into going POCs happen lots look are 'XX, end production saw the to we LLMs AI 'XX of lot of deployment of then last

so secure questions many they we question things workloads. their even that the do about answer how AI -- is, customers ask you really from And how can have? do And what well, first the they And are are to the cannot that.

so whole and the that saw DeepSeek we TotalAI Qualys recent TotalAI bunch in a pointed issues. and capability, And you of found sense, a probably to blog, our

And putting compliance that not about really something it's is helping following that whatever not information production not. this. is guidelines could customers jailbroken. vulnerabilities it as get is they that as comfort environment that in well level should of be the It something in are out It's detecting that leaking

to them And we so unique is in to that environment so sense, provide AI once first able And have to AI deploy way the they our discovered TotalAI actually first have workloads, workload visibility. agent existing then because they scanner, footprint is scan the actually discover in we're them see that that to don't we able discover from the already Qualys and fairly customer to their place. those solution using in another we're then the leverage it AI help the

the pick Board early Strategic Strategic most. them for Advisory good, feedback we area very is top up Advisory in the in mind been So has our our came that CISOs to when for of 'XX, AI fact, ask security Board

to into turning engagements paid we forward look opportunities. So those

are exiting that through anticipate overall going this it in trying budget additional don't come to to how additional pay are money they for out of does Are they for that also they this? right around spend going Do their to figure that is We now, get cyber not from? be CISOs to going significant. However, they given Are move security? get increase Where budget? from to budget, that significant? going some

definitely it's feel from it way so And little it like into that right the up see and that's build up the thumbs for that LLM pretty we way a production the kind to to positive. like getting impact or what see early then they is going look we the a And starting and now, is but thumbs are this in are have, us goes know immigration, to AI, unique. the that So scanning can is it eGates opportunities sense, we're right, it's think I we scan a security at are encouraging as of it. that and that that great back down feedback they before that customers go because give will a at bit

and to couple what the again, next ramp see don't additional investing want to and security, we if AI have going gradual now detect, that terms the able we be able more scanner know will around and to pointed of to around in evolve. versus year And year year things to of start that blog budget our And you much our a when yes, that from So this how excited get this that found it CFO is is greenfield, on read we're but years. you is kind next also about of CISOs expect depend in into We to can the it that? right really DeepSeek, are monitor things that. how we just opportunity

Operator

Our the Davidson. from comes Rudy Kessinger next from question D.A. line of

Rudy Kessinger

and quarters now, better have both a QX, revenue two in you're pretty in last But you on outperformance guidance seem The pretty to current quarter. QX the the guess then decline expectations, as like I guidance really to your I that -- just particularly continue, guys had came had in calculated current just strong just QX you know and what expecting expected? I revenue said what with again, the particularly weaker than billings quarter. good relative calculated pipeline it and for into you QX And going billings, revenue, look doesn't at in expected. the next year, specifically

trying QX drove So not was just providing. I'm in that upside? QX you're the guidance in there to QX, I the and together put maybe don't strength continue the know, onetime in anything Or that that but seeing really

Joo Mi Kim

Yes.

bit that we partly of take performance have that, billings, closed linearity, to the in renewal The at particular, quarter have cycle. a did booked did But XXXX in current QX you due look higher QX. terms if little you're a was revenue the taking look in if an we at in how better of look the and the better bookings second the the that a revenue on deals in it invoicing on half impact the than

one looking days to little X the the -- into from our why the if of taking at reasons because great plus it from of made late a which is lower kind in the renewal mean rate, of of fact currently by QX QX is stabilized. is into QX. we've that a we're into Looking look was assumptions looks QX, and that the XXX%, I slippage any then not QX number And expansion consideration at predictive the you dollar take of relative one year, then net at the full light

at a take before you if years down. it's However, year a even or look ago, X

the into partner-first consideration, then we XXXX, going that at So business, are So expansion to relative we up also business negative trajectory trend approach, the looking QX fact making a And that shorter-term net rate could the the taking XX% assuming to improvement partner revenue, that into means right? which in are have that dollar taking the of XX% XXXX. in in that with no a continue impact of year into expecting we ago, are currently which growth.

Rudy Kessinger

XXXX? But 'XX, first had you quarters growth the for land that did called bookings. logo a out, growth QX X. double-digit where to to bookings on year-over-year 'XX. expectation on seem in know I weaker know to It what keeping I I know of remain new think, would expected your DBNER in I you're that expectation comp. tougher it's -- was new X several in logo is be be growth new And QX? logo And Like in than of then front, Okay. the steady,

Joo Mi Kim

growth the Yes. That be that revenue and in that called disappointed light performance quarter it now because like bit bit making little to out we new bad. is the added a to little We a the that then perspective the amount last rate. bookings a be assumption right actually bookings we're the out fact QX, looked it with turn to QX were from had and new earnings, did

path that growth the assuming business, we So because especially our continue new just on not we're particularly XXXX, will new logos are landing of focused meaningful expecting through we're more kind that it into partners. on in

closely working they to kind that new to out we offer get be them and that can see them with incentives us so in. go we'll help of what very really the market So customers into can

Operator

Our Shrenik your question of open, for line Shrenik, comes line Kothari now question. from moment Baird. please next button. One your mute next our from is the check

of Josh line Our comes question Wolfe from from Tilton next Research. the

Mark Heatzig

Mark Josh is on This for Tilton. Heatzig

how potential the you in Just vertical question. vendors of terms year ask that conservatism heard We've one about the coming are the it's to how several related about opportunity into wanted guidance? And to change. quick and talk and thinking administration just for we the federal factored the

Sumedh Thakar

right as what now Yes. the do We're super things will excited changing. that think guess about And with the good mine think I a basis, right? as I are opportunity, is the administration all your exactly on day-to-day

think and in everything more that from doing. things bringing the way really not is the new doing been definitely However, efficiency the federal administration about the has I old government narrative

for costly of lot years a need a -- that federal many of we because are that so hardware, lot maintain, us for as capabilities many opportunities on-prem vulnerability using assessment arcane. that They people. And have to agencies been look at need are

Patch risk we all Management, And Management, of only EDR, our single High platforms High certification, await so as the management, platform make which platform. will then in that Vulnerability one as a FedRAMP FedRAMP our does

We the about bring. it are that excited opportunities can potential

invest team. the team certification federal with as well to little right when with side. on And just now bit but continue in administration That will for get the we focusing are one year, we're this focusing a know hard of changes, GTM, that FedRAMP on is and our the year hopeful things that High that. this growing We we federal to

now once opportunities open And for on have we what that, can tell hard impact us, right quite it get will up to that bit XXXX. a but of

incumbent factoring of and we're majorly and to But to on for efficiencies direction, in there the more while. older capitalize been it we have being positive So being on-prem bring in on-prem able versus that narrative we're well right given not solutions suited that -- to modernize overall, a anything moving able that now. think infrastructure a

Operator

Loop comes question next Our of from the Kim Markets. Capital Yun from line

Yun Suk Kim

ETM. Enterprise at Management out or for I'm there, something the on. TruRisk guys that and that's differentiator question clear least Quick It like seems definitely a you eye it's on an keeping

leveraged If Is that just product not could we're ETM, you heavily obviously, competitive be into the can landscape. go-to-market the just this leveraging the talk a channel, year. And about this direct? the around overall channel motion

Sumedh Thakar

doing comprehensive they now, look really don't focused who There risk do some that don't any is aggregation we ours very is space are that other that that's see kind see some if -- are solutions well. aggregation have on of you but job at Yes, question. Especially you anybody do in quantification. that, good also as remediation. we the right a quantification, solution part doing good risk as we they a don't we but that don't aggregation because definitely, don't do some believe at vulnerability And as

And they solution year's just say strategy. Board out be authentication want want another the Center. multifactor to able if platform they ETM the and to They which of the go because excited of strategy a are for so look Qualys we're our next say operation their lot that for center, concept to you don't risk Operations the Risk to as building about super and the CISOs to want at implement

threat and so years it a multiple and out to doesn't why various Just say risk risk able of currently, able Center. detection. have million day. our is that because provides them it operations high. signals out we loss We happening Operations like center so a on And based look, do for be say, provides the issues, we potential proactive the Risk bringing the but possibility from And million ETM we out a want management. go fixed many platform that's had ETM business quantification, to $XXX $XX allows many business. a And has they things CISO Today, of that for mean to the be to anything different to XX the products, security ago, conversation. built enables ability to

to CISOs to down feedback look if $XX level and we that to much invest it, CFOs can XX%." out we enabling say, and risk And have bring a can gotten. with better right platforms this an acceptable the a And we and is potential that in they there that's other losing that we by so how conversation of see $XXX,XXX much better don't day bring "Look, That's invest now can the to down a we it the that conversation $XXX,XXX, the cybersecurity have area at as of now really are million that. particular

out I our out this think less year comes us existing sellers replacement evolved new definitely it's now a go this your and you if vulnerability that's can the cloud about conversation that for solutions, the vulnerability keep GTM you have because business and ETM really about provider. as can management so there. have, and say, solutions that that current you provider okay, provider identity

these a discount. teams easier internal well already because some not getting bit data all any it we their to can the conversation. makes have to them to CISO We additional for replace have can here tool solutions, is which easily view take existing the the replacement go they're for a from consolidated little of are you from of working them, with that We coming just and to risk fight media a not show for all a potential

business you're cybersecurity So any that us logos a it solution. acquiring another it becomes customer and for potential customer if tool new any our means has as long set would sellers, doesn't new replacing for have essentially to that take

are go they has for and paying solutions purchasing us for security it revenue us make that in for cloud might one opportunity additional those then their on investment right? gives tools layer top EDR that estate, team, findings a into they're but as top well-known to of top. customer some just security customers an existing other cloud on we cloud post-sales for have And had get any that cloud already opportunity well. that have ETM one, the provider the capability, customer Our made what paying provider might So they consolidate other to of on revenue to their then the

as partner competitor the with or course, margin and needle But perspective, you little margin, bit them for of a also we the been move work could have from there, as much. but solutions give here certain more selling a doesn't our partners, partners that

how figuring they where business. make with However, services et is increase out because services can who of many of revenue moving providers to they the resellers, are cetera, are lot a significantly managed can

ones for customers deployment, service service of who brand-new at services. deployment And that they so ETM, And are risk largest the really for are these services the around actually looking with aggregation, where for risk monitoring, for services service quantification, today and risk elimination. are need

the on more to are even potentially which services people. generate service for Qualys additional add partners purchasing business and is these in can them market, every top partners on. revenue many bring business they because they why Qualys can products is bring of of can that But market Qualys and that So the excited today are MDR a the MDR reason by cutthroat provided

and really are through get about key our we delivered part, we for so to constantly to that that part did release ETM have deals, of in what be is that and about enabling conversations a of partners they the additional are you larger And with is mROC the most to those doing, make where bringing excited partners the replacing to so us revenue. also don't tools saw

honestly, CISOs, and the So about answer, vendor. tweak consolidation with our GTM them single that of interesting have that they at have. actually all, when bit that if existing tools going replace to we thinking a very Because of their a set they're little all few them, letting of definitely to way talk conversations tool to replacement are and use for but more and longer is a less something it's an us

Yun Suk Kim

Well, I opportunity around ETM. can tell the that you're about very excited

the the question around So that just another around making you're indirect investments channels.

the hyperscalers and talked already environment? environment this MSSPs, Is what deployed cloud opportunity CSP? the the but You be about about as also CSP something around on that could well, the meaning

Sumedh Thakar

CISOs, is that security today, solution at when or that's can I you by either have by the cloud you of say is this one solutions. the provided I great. sure, cloud-only But for I -- provided ask Yes, think CSP look if

Do And risk. in cloud-only the directly, of looking a you answer much question access that know then pick know from admin you a are be you the particular lot does on will risk they open, how you'll coming how up, that might of laptop because provider buckets cloud an be who that business? the open, provider your of that to the up may but budgets account. but cannot malware times, the is cloud and now XX stand impact EDR have the but is because So risk a that lose that these not pick to cannot

that's tie have are do our providers, those. they two customers, cloud you How different providers, and something with these leverage useful. things together? where And they can with working And EDP larger ETM as cloud and like credits be they different can

have use for can of with but essentially map work to customers them can to transact with their cloud continue or working who then other credit. actually through some as these providers like things -- partners their ETM can that We a way credits that find we that well tools, can purchase to

So explore. We had also opportunities are a with those provider exactly to we around are that continuing cloud conversation I the recently think that.

year this an forward as push And so area to that that's we continue well.

Operator

next of line William Jonathan question the Our from Blair. from Ho comes

Jonathan Ho

of comments wanted I of how product making you just this where your Congrats most level on understand the side? should to maybe on see be your guidance, and that we go-to-market either investments thinking about results. you're to relative leverage to to strong the relative the year the or sort opportunity that

Sumedh Thakar

evolve continue us, to for we think product. I the

so That's partners. on for success think investments. continues partners mROC. we're, GTM like I our we see are opportunities focus to to But seeing again, with on where tracking -- And our we're us seeing returns, things with work be the there

which then cetera, do pivot something partners to going doing really how continue bring it's and towards around with the federal continue find et partners business to we business, et to business, cetera, road that this be in bring can them investing mROC, marketing, and so but about do. joint that to shows so they is And with ways investments GTM want co-marketing, in in we to more to invest our working

So area we those looking to are the do. essentially are that

the well. that is do as product and very we efficiently something think we well development area I do

continuing there being go et do add to see course, will increases. around where and our there. much and functions so POCs mROC be in surround be investment continue certain And able out and around of with markets investments success the the for capabilities And and really to we're around on -- to I team product solution ETM, will how we necessarily that's going But to and cetera. engineering not so sales

Jonathan Ho

time? just that a on of as from standpoint, revenue this it. we've Got think the adding it. I Got about think immediately, of over how versus the approach emphasis uplift like you adding bundling a axis but quick what potentially do side seen additional product and follow-up. around of And especially a additional assets? do How mean of lot in selling maybe I that conversation. along not we TruRisk TotalCloud and And think our looks

Sumedh Thakar

Yes.

platform. layer And top different the We are company that CISOs capabilities interact has. through is becomes see on as a really becomes of about the We cybersecurity ETM opportunity. actually with layer the ETM, the which excited that which the ETM -- the

inventory, interesting becomes play And because so adopt can can cloud way ETM, is we security. management, who actually actually want they to vulnerability that the platform see they for ETM, now adopt adopt that the those quite

modules parties well. Qualys need as and from third of other as these bring data Some then from they also

then as so conversations risk pull you in is a allow going management we see do for that you our customers, ETM get can the -- things basic feedback you that well, we up your on these later around, going can more layer on year come platform from here's packaging And that customers, initial I with data us to with that third-party the things need that and as essentially how we and around multiple Qualys inform that to for includes through coming by using ETM initial bundling think is this the learn spend we our additional conversations in. And modules.

security they them of conversations has our the Qualys integrate dashboard seeing ask I with single much is buy entity are because risk Today, are That's they me different a environment because to XX a additional XX that instead is say how already anything right? singular just idea CISOs these from particular and doesn't posture different when tools, in getting a every where lists. findings. set customers, different score, modules view actually that what tool looking they the talk And all today, to about into big is reporting of that show but risk we existing

now why Qualys and So buy to because TruRisk additional AppSec already I is use anchors AppSec there right cost from the Qualys that well, within built ETM. to no say, platform, else versus into is the should somebody

you like can third it's data AppSec from a So like. would party, if bring you

we're they that, then but and have to if pay open to So already incentive use pay Qualys license then an for ingestion module, they is ETM an ingestion the for example, or that potentially the the don't data for which as we have, they them.

to try get allows them as new. from purchase they pricing And see how to create of we without feedback rate time our then will additional adopt So products. out, for every attach come up to how that more roll the increases part want this orders capabilities we do customers that having with as something we ETM and

Qualys to we find do way, or access a to with a least us. the have them multiple spend way capabilities at that with So give have how access to in from they bundle to

customers. excited are we at are should things that feedback and we point pricing right bundling and getting from are inform later this these about how that So out working year. And we now through that some our roll

Operator

line question from comes the JPM. from next Brian Our Essex of

Charlotte Bedick

provided This Essex. X last throughout revenue think provided the year. I especially a it should quick similar follow you've it the going your Brian guidance? you think quarters? And trajectory throughout that with we had billings for should we Should how -- overall, to year? what of like the the about guess you A the is Charlotte question. revenue on for guidance How Bedick strong for now billings,

Joo Mi Kim

Yes.

ended X% rate to XXXX. since I X%. revenue X% provide XXXX you growth at now and rate for guidance, just current billing as a assume guidance, billings, of billings assume XX% total would year we current is the growth can current in same for the revenue For don't which we

Charlotte Bedick

continue have what growth? needs can in effect you what translate lagging do happen do direct. that Can investments to it. the just just know at channel Is product you think to Got a I help what you've you be like investing I to with investments versus Like to top need like you need what still channel point follow-up. happen? to a think knowledge you the see needs And me like overall to overall, still in it quick invested understand line in do?

Sumedh Thakar

of direct and margins new evolution of have them mROC relationship our can right? [ years focusing This initially partners are Yes. percentages our a we make just is and top logos dollar of of -- partnership, a that confidence -- net couple launched This some repairing customers step. of product we program are revenue fine, year that of and and the that the but services partners how is how next bringing us additional a building regis of the is. fully multiyear potentially, partner this to on can ago business new help initial was bring was evolution next for with and strategy evolution ]. getting deal working first, we to We sort going the evolved the take $XX of where into on which we the having That's see them revenue

track [ we And continue think ]. -- to I course, deal so our internally, we regis of

rates with having our is particular We continue to our clear good track success so with strategy far. partners. pretty that It win we're

a while pivoting it margin. our maintaining think that. down split reasonably about to And have you a going is XX-XX towards done from good And I so pretty now job of XX-XX you're

And partners. I our testament a and we to our thoughtfully working think the way tracking that that's investments with are so

and a then to of So that and deal lot we're also our regis investment, collateral our them ] And are of with time is over continue work spending doing their a rates that doing for improve partners. improve win part our providing to lot [ and material partners upsells and we we partners. SKOs, of with continue these then with training with opportunities

Qualys capabilities. of Qualys So some become they and of how the capabilities the aware to pitch

we that So that have areas continue all -- we there. in, been and are to those invest investing

Operator

question comes Fodderwala next from line Hamza Stanley. Our the of from Morgan

Oscar Saavedra

Hamza. in results This Oscar on on for Saavedra is Congrats solid quarter. the

persist sustain correctly, to back at ongoing you're near-term NRR Going expectations budget noted for XXX%. to you earlier, if to adjustments expecting heard forward. to potential quarter, noted around going CRO expectations transition. to scrutiny guide you for last Today, I And incorporate guidance, the

that can all of So us bring together? guide? about help think And how you conservatism level we should to

Joo Mi Kim

Yes.

points our this think takes consideration guidance I laid for just of that you out. year the into

it's our the drivers existing I in still growth that our biggest think business, customers.

thought in what as bit working we partners business products kind ETM, to look lot and a of will because to light given and of uncertain. closely timing is couple And like again, we with see assuming new having to expansion revenue bookings upside like versus Sumedh years, we're new XXXX drive today, a and guide that So where realizing that that's of XXX%, at well into recognizing that's a the and within based guidance as the this consistently today of the no the land prudent net ended dollar But if ticked it our opportunities in you talked XXX% assuming for take XXXX, for performance us on is there's QX, X%. about, improvement expand. we very we local what see into little that informed of of down rate and our our X% in entering last was we're XXXX to continue at

Operator

At this concludes conference time, today's you. you participating. Thank this for Thank call.

may You now disconnect.

Qualys (QLYS) 6 Feb 252024 Q4 Earnings call transcript