Qualys (QLYS) 2 May 182018 Q1 Earnings call transcript

Good day, everyone, and welcome to Qualys' First Quarter 2018 Earnings Conference Call. This call is being recorded. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions for asking a question will be given at that time. I would now like to turn the call over to Joo Mi Kim, Vice President, FP&A and Investor Relations. ma'am. ahead, go Please

afternoon to Good XXXX first earnings call. and Ryan. Qualys' welcome quarter Thanks,

to results CFO. discuss our today me Joining our CEO, Melissa Chairman are and Fisher, our and Courtot, Philippe

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

present GAAP non-GAAP earnings included During this non-GAAP release. GAAP both is and A call, financial reconciliation in press measures today's to of will we measures.

press over prepared As that, the our like With investor the are available release, supplemental reminder, remarks, on website. accompanying and I'd turn to presentation Philippe. a with call an information

everyone, Thank earnings to you, and Joo call. Mi, welcome, QX our

track including MSS and free Qualys fully Compliance, with XXXX We joint & Policy and Qualys integrated the and included Apps, Management results As and response security base. the remarks are Ernst customer opened Threat a moment. Vulnerability I and of In and the CIO/CISO pleased we digital of security have key today: groundbreaking to strong CloudView EY employees-owned we securing scale, providing integration questions provides ahead managed practices position provide CertView, emerging visibility, Alliance, cloud uniquely Inaugural centrally Platform to of details go monitor compliance footprint And the share our endpoints, reflect digital Platform, Vulnerability in is July previewed prepared the well achievements. two cybersecurity inventory, and Management, follows. of QX, expert capabilities on partnership Cloud security, we discussion. with great five the our to and enterprise-owned as our help immediacy, through The portfolio. both in DXC of which compliance revenues Melissa PC, Young ability announced Interchange In we Melissa centers and of with and will to platform the security that many to Security with shortened allow quarter operations services, Qualys the for our and both resources. of the VM, These released innovation certificates we the leading to us orchestration. which companies leading go-to-market enabled as Most Cloud best as and expanding launched instant our you, those another clients tenets and stay within discovery, and transformation. product to XMobility expanded accuracy, more Expanded cloud-based as recently, profitability. that that for threats. acquisition transparent time all Cloud Cloud report self-updating enterprises, size enable following

Platform, with asset GCP. first micro-segmentation; be unmatched global Our ability integration Cloud industry's competitive vulnerability-based for the to Google will to Inventory by as Cloud the Command then Center, as Illumio in seconds Cloud also provide and with Integration two IT inventory SCC, deliver Security well offerings.

showcased of to their in devices and delivers appears Browser and CertView IoT network with scanning technology a the mobile, in cloud is that REST automation near new release CertView platform and extremely demonstration new and network, of build We topology, We it and via free demonstrated on environments was the technology customers new groundbreaking and security more resonated our helping digital cloud Security interest XXXX app, via the cybersecurity CloudView, Our the our saw DevOps point and organization on-premise, At and and RSA security fingerprint and and well their a including The a enabling and continuous recognize track both platform, our as discover for turning real-time Qualys to them. our manner for released APIs discovery strategic helps enable digital that our we devices. determine RSA and non-intrusive passive full compliance company environment, two visibility across monitors streamlining CloudView. their network also to and them our partners further hybrid network of passive monitor Conference clearly gain by forthcoming Recorder assets profiling which services for and teams. cloud traffic extension offering as threats. a Platform all becoming live across partner, provides services regain stack Application not soon customers monitoring public asset mobile for transformation devices certificates uniquely on. Conference, and from They that scanner services, including new greater bolt their consolidate to Swagger for visibility come. We Cloud resources Chrome support, services Web help out-of-the-box of visibility the Jenkins integration, our endpoints,

I over results. Melissa customers, With discuss customers, across instantly distribution Our our solutions the our making Qualys over improvements financial partners new serves as will with and natural providing channel, to us to operational XX,XXX turn financial to Cloud globe available Platform, and a both the thus leverage. call also used that, by and

good and afternoon. Philippe, Thanks,

except unless start, are all stated note financial like otherwise. Before for I I'd figures non-GAAP, revenue, that, to

strategic platform growing as to in more or four increase solutions Average XX% X% up highlights. from a The of As XX% size Cloud driven year. or customers of for the Threat and in Philippe Cloud XX% XX% Revenues financial same quarter, ago. QX the three bookings. we XX% customers following last demand our deal continued cloud ago. enterprise Agents were increase last of purchased and the strong $XX.X quarter to see enterprise mentioned, in rose XX% from continue quarter, million to by we the to XX Qualys Agent both markets, represents a leading year our were X.X year quarter, first over good over over percentage a reflected XXXX the from months, with and last up positioning growth The rose with quarter this solutions Qualys million, which year-over-year. the more percentage this saw growth operational Protection

of XXXX from up bookings QX X% in the XX% total XXXX. since New products released quarter, in contributed approximately

Our $XX.X as scalable adjusted margin quarter and EBITDA representing reflected to for significant to XXXX of drive model compared margins as continues XX% first year. XX% the a of million, industry-leading for same cash last the flow quarter in

of XX% adjusted year-over-year amortization cash the For increased margin quarter by of specifically the impact XXX, would be commissions. EBITDA adjusted of to And $XX operating million. XX% XXXX for QX comparability purposes, the flow for first

quarter continue payments obligations, in Capital And invest cash were first we lease in to our QX, shares. in principal We the repurchased XX,XXX Qualys. million expenditures, XXXX. under $X.X of including capital

XXXX and our by the $XX.X our we're the have model, authorization. guidance end marketplace and, midpoint. our raising of million in results, scalable revenue therefore, Driven remaining We momentum low our fiscal operational great repurchase share our year in our

revenue $XXX.X XXXX $X.XX to year non-GAAP range year of fiscal current raising our million. $XXX.X $X.XX million EPS from is We're XXXX guidance now $X.XX. a a of to $X.XX to of a guidance to fiscal range Our range

to sharing and have XXXX our of Investor roadmap, $XXX.X forward quarter XX. to to second be would and to We revenue of expenditures look vision, outlook with to strong million We a any Analyst financial of your XX, our $X of greater our June as than be XX% product And and virtual for With as XXXX, XXXX. expect we March that, Philippe the events, million. million capital deferred of the questions. range of happy & QSC balance balance you I March answer XX, at current in User $X strategy, XX

Thank you.

question-and-answer We will begin now the session.

from come with of line the Henderson Our question Needham. first will

line now is open. Your

that, in (XX:XX:XX) thank I to Was to down I think just in XX% Is from that? slower – down that for anything hoping with bookings. to accounted there in The that would accounting the you. give that anything in do it sense or along talk you anything about helpful. growth the the of you the quarter. Thank some little change decline XX% seasonal, was Great, has slowed in could us growth be bit very almost much. deferred a the

Yeah.

have So, great a remember, quarter very outlook. a we and had we healthy

be look As customer-driven. is deals calculation. metric you non-current And we've the billings that is is metric, our our are would by proper billings multiyear XX% to a don't amount discussed as we fluctuates. if of said, so referring the to because billings you're at current the and before, number deferred going We revenue the force sales driven incent prepaid and on that, which total

it focus timing So a over that's on for of differ, year-over-year. why on it basis, we've for by quarterly impact growth may is time, which proxy remember, example, that billings revenue a quarterly invoicing. but is deferred not current the comes discussed Also on XX% as bookings we a of the perfect close, basis,

of So March invoicing we up in end on deals number April may we a that XX come on have X.

inform proxy of is momentum our for really best certainly guidance because bookings So emphasize our guidance. trajectory the we annual revenue current business the

Great. Thank you That's perfect. very much.

will you. JPMorgan. And Sterling question next our come Auty from Thank line with of the

now Your line open. is

This on for is Hey, actually Kamat Ugam guys. Sterling.

Hi, Ugam.

Hello.

you in mentioned So, that of total constituted quarter. the XX% new products bookings Melissa,

in does contribution the total dig how bookings? fair Cloud the to exclude of we if the terms Just level other a to deeper, just products Agents, their in

both Cloud grew Protection, but Yeah. In – as total, XXX% that's do from category, is perspective, and Agent the the very which other – ThreatPROTECT proportion bookings well. Cloud they primarily It's larger Threat a Agent year-over-year. a – continued group, still to over and

how with previous just And how you think much follow-up in opportunity left? your is within question, that to upsell base penetrated of are Agents, the a to Cloud terms just as much Okay.

XX% a lot have still Agent only so the opportunity. still there's question. There's great Cloud a our for Yeah, customers lot this us. of a of point, that's At about upside of

point. I see customers would one add who deployed We're we agents just did the on and the with one like Yeah, endpoints. endpoints, now to deployment more starting XXX,XXX has on

make to real-time, our more servers the in vulnerability see moving effective, management from can we So traditional more more compliance fact. policy precise, and now agent

the Now, cloud as hand, environments. in our very well moving on we agent well, endpoints see one as really of

will Smith, come And question you. line next of Howard Thank from our the Analysis. First

line now open. is Your

to thank on year. and for Yes, one solid for a Melissa. One you the start congratulations Philippe,

reception, on to a out if couple days coming commentary For I people weeks Philippe, it's it know could that a just give But hearing. any you the offering color early with was some acquire you're customers, way ago. CloudView, downloads, wondering free CertView, nice your I from discussed you've very

Yes, you can I GA. be give specific, was certainly And to so some totally CloudView color.

have about all of people clouds. today this about this full the remember, right of free And inventory is X,XXX have essentially And so, across than more signing. service, CloudView we their view for is complete so on a their who

So, expire track their digital digital is that's service – obviously. The or full are them is free they not where we when world, the any the – when is in small – going the certificates, very for now and a Internet-facing to which when good to large, GA. CertView, with certificates entering company are component, has they, signed news just ability

significant uptake are the of to this as – have expecting we course we see So, one well. on

capital your Melissa, just remember or repeat Great. was coming is quarter. there. Did And, that the there and in correctly, comes strong? If Thank accounting flow strong stock-based do you. items first this I comp was quarter, some last that cash working seasonally this just in very

comparison, being look deals if multiyear have Actually, Last increased drove collected. actually of impact it's at that had the an we a year, of didn't We actually the profitability that. you lot year-over-year it. actually prepaid

So, it more driven profitability. actually really by was the

you. Thank great. That's

Yeah.

from question Thank you. our Morgan And Stanley. next come of line with the will Melissa Franchi

open. Your line is now

my for question. taking Thanks Great.

customers good is you Cloud higher about the seeing that so beyond solutions ThreatPROTECT, Agent adoption multiple mentioned one up number but metrics question of X+ of so just the and in? wondering you solutions, adopting continues earlier those to So and solutions, I'm the traction just following inflect what of on are

have the Oh, it's also across out our include but it's been ones solutions, to all of longer. which obviously, going older really

versa, customer adopting So, or customers that well Compliance have were Policy adopting been would the customers Web that were VM as Vulnerability Application vice might for Management. Compliance only example, drive Scanning or who that Policy

okay. Okay,

each phone but just now you It's give going finally appreciate your sense single all and you really apps the one the Yeah. credit pretty have single And platform. are the of we could on card if value multiple you Uber you're these With that more analogy across of are they disjointed what I services. is to is at in have absolutely the we apps to in customers the application. add – your which, of to pay, each realize platform. starting and improve, at to between our And all essentially that go speak you're and are and these one apps, really that really today, more fact, people have other. they with that, look other And now provide. going they that Qualys, that But there's benefits then to now there amount essentially especially a you that's different by the they have, services that way, the

it's strategy really create the back-end to of these to work significant which also all way, integrate all even more So integrates we're frontend these very the by off. that And that smoothly create was application all applications. is a that which that done of working the think I now, clear really paying really

ago? so year Melissa, follow-up maybe, versus average this the It it contract numbers put of just what's of quick ago? duration you the made revenue, quarter you the quarter kind parsing a terms terms say like And than to in a that if is through That's of just the that's for earlier the in wondering some so year conclusion. this sounds like, that comments kind fair around shorter of, was one it great. like I'm just like, could deferred

few Yeah. the last X.X% It's been around quarters.

I think year got it increased X.X% to, may have a like, ago.

So, moves. these are kind small of

thing one length one that, look because it's a are very typically customers our small of contract, we at is the you also, And lot when year. Yeah. who have of

That's right.

SME/SMB, – trends, three-year at enterprise stay year. contract, we you which real about a look so, more see, they see if we when And moving when at our customers the the to more and still

just them then of And all is decide as mentioned, as Right. within impacted revenue even going which that not our from that bucket of separately to obviously to multiyear well. is I actually number prepay, the be that, customers non-current deferred by

Okay. Thank you very much.

Yeah.

Thank you.

come will Markets. with from of line Capital Our Matt next question the Hedberg RBC

Your line is open. now

performance. a if real started guys. Hey, can little guys on for you, you from benefit questions. maybe yet? I'm I'm my you Philippe, give have more taking any to GDPR Thanks bit wondering starting color with us geographic see curious if

So, questions. that's two

because So, very Europe geographic performance of has been good everywhere, GDPR. doing well, and not really

are and Europe move are the are more direct we which growth. base mono there think yet because we adopting in in bit product. past the they solutions. therefore, correlation But the And customer finally these solutions a our bigger. or, bigger, more And was one. And little now, I very upsells are good see seeing And to to have deploying in starting therefore, very essentially Europe adopting have we getting obviously, and is good more really customers also not it's new GDPR we

– the Europe, markets, are doing three Asia, – Americas, the but today U.S. well. and very So,

maybe that? and on one On that's still like Container competitive then I'm what any and launches it early interesting it Security private solution, in sort know an in your of I beta, does newer I'm beta, for other if for And it's but feedback been wondering there's product. interested like curious it's who's one of one. landscape product, any product that seems look – still your the

is good again, (XX:XX:XX) a same question. this very it's So, the so

infrastructure hot very entire including Qualys. containerizing ourselves. now we're So, mean, I container for of is the

our So, we're also there. ourself, solutions using

this interest with other again is compared Platform. for Qualys totally the huge people again like, with a containers. there's that integrated What solution, So

our So, as all becoming well. strategic to And really, and existing into it's That really an bullish. is product are is are this early still think coming really close the cloud of customers a into but as containers companies market GA. I moving moving very market

being managed, the that the apps and CloudView again, was out earlier. the So, platform the which Think all having with the analogy the of self-updating your both giving all phone pay, same... I everything is centrally same same in Container of of of Security,

Interoperable.

the to customizable eliminate. you of data for top to like you the then that you you way also to And on customers. all create also brings can our Interoperable, costs ability app an the the it the that that,

So, is integrated. totally what also, that's we significantly done, I it have think at which and We and were passive scanning will our RSA partners resonate the floored. showcased again, absolutely

mobile detect any devices, we and on So IoT devices that network. now can the connect

scanning late So by deliver we integrated to fully track are summer. passive our on capabilities

great. lot, That's a Thanks guys.

line question of will Summit our from Nandury Group. come Insights next you. Srini the And Thank with

Your line open. now is

you I have a Melissa, right. much. All you. so question Thank for

average why year can growth? you any mentioned have comment provide grew sizes deal Philippe. – And the color rental I for Can cycles so? last what You compression on (XX:XX:XX) or general, you a the this have some XX% sales follow-up seen driving the with also, is year-over-year. in you

Hi, Yeah. Srini.

of been it's after One size, seen in couple increase. seeing deployments impacting So factors we've have the really increase a existing we're that larger of is the continue quarter to solutions. quarter it deal

So customer let's or traditionally starting part capabilities, whether they're bigger it's with that's new it's also we new solutions. of seen then it. a say than their it's out But adding – a VM on expanding customer had

are that driving So it's deal really up multiple the sizes. drivers

And on the... Yeah.

On the I'm sales ahead. cycle? sorry, go

around that's the because that Where are on new, need is cloud clearly same. cycle, the is the greenfield is this think the who is register And is for the that that X,XXX-plus the traditional CloudView an on see indication I and the of I this see new why selling this service. early – is at the cycle not can market, that the again we of cycle sales significant who about can we sales are be There that register this changes. course – the – is think people And Yeah. looking people are this solutions, free for shorter cloud – visibility. the people should

Okay. acquisition against do, expected to color, Philippe, recent provide can it close who some what you market? does you. does on XMobility, the acquisition, when Thank the is compete and your it

a XMobility acquisition team is totally. that deal. what have integrated so a provide already what made. is Pune, India, in has we fantastic essentially, And – closed they is The The nice Apple I very done into a a So, they with well acquisition is this that correctly, also done Mobile, is – which Microsoft Androids, iOS, as and as application version mobile of of well-architectured every goes think very I recall agent if BlackBerry.

so essentially, we the it's have for technology one that And similar the devices. that agent traditional the that

your bringing that tablet. it's customer capabilities to we And we're into – have mobile which I'm that's so essentially. demands, case I as the going And Qualys the Qualys, all environment. well. mean this I've an -- currently is this app got this that use with the and myself extend something I've got sure every that to Apple

today, mobile if device, of devices. able thing not the really to management there's being essentially there. So, the is that term in is security which out But capable, there that quarantine devices of is that detected nothing has been have of only which you something

are the have which the we to their solution into platform. of And plan the this of So in fact increased that in value to has are I integrating current when is think Qualys. for strategic significantly market, we have to going term

what do integrated have everything solution but they to platform, because we acquire all are instantly our it that – much of is distribute The know, are of self-updating. customers, continue to don't can into because easier already, into not these and we platform. we reason you our centrally we the As effort makes across put selling all the much customers. and this this integrating once when the cost it they and globe again then managed application our also And for also, more we only companies, effective

we So, so coherent our architecture. with very are again,

first totally of next year. we're Qualys integrated quarter in with the have solution So, to anticipating their

Thanks, Philippe. color. Thank for you the

the come Thank from with of Suppiger question [JMP] Securities. will you. And (sic) our JPMorgan (XX:XX:XX) next line Erik

now is open. line Your

percentage One, products been new a been have if questions. with three they your but in JMP, have of last quarters. you the new rapidly products, revenues off – leveled by the two generated back They've pretty quarters. growing Actually go growing few

Agent, any were us that of you deployed metrics they XX% Is wouldn't XX%, reason then reaccelerate your additional of Can give think how quarter? that in I kind can you agents what expectation thoughts why for a sense there? XX%. we secondly, us the what or going give have might are many Cloud and the And forward? there you for

Yeah.

first. So, let first question me take the

products been well. doing our So, have very new actually

over time. company doing total of the actually XXX% year-over-year. how point As the rest is I bookings percent bookings are Remember, any in solutions mentioned, relative grew at to of the

Management, isn't Application So, like solutions well for Web example, shift mix growing the very overall did in quarters quarter, are where much. to other well, going Scanning very this Vulnerability

focus company So, product a because revenues by total our going products platform. it's predict. to them remember push on that incent And to on And renew. hard sales customers not we force because bit little we that to they're want don't we don't selling a we're

So I you solutions the additional in color let very any we doing may mix one provided that's the that well quarter change. to and know why are these think

more you thing compared the of will new and not one said course, will really Melissa to And more ones deliver to solutions course, add that, as of is will obviously, the we that volume grow. I that, services, of what Yeah. existing as expect

So...

then... And Right.

does So, that...

Sorry.

should over know side a expect quick difficult it reaccelerate that that going on suggest to is to question how Just VM XX% that we longer is that, or the front. perform? term, to Does just the

visibility have everything. would is the well again, becoming people need absolutely. because doing (XX:XX:XX), strategic, is more yes, because, realize VM I very on much to VM they now say probably

course, are doing not existing of have fully And Still, so, lot a still customer which in our there's VM. base. really expansions we of companies

impressive, to is we're point which going have behind a So, so take. in services that us, that some But of new continue. will to think, at we bringing I quite course, time, the is that of have market mass

going going solutions get was to is new the we're additional add it's primarily Threat I still to the from that leverage Today, coming Protection. Agent, to Cloud because And out. Yeah.

from For as still have the digital not well the GA-ing, those, they're IOC, that talking management of we're the Security. as as revenues only assessment, but well FIM, example, CloudView additional new very solutions We'll as early. Container about certificates,

So we will have...

Management (XX:XX:XX). Patch have You

Right.

more to it's that specific numbers sort the just drive by should time. it, hard numbers predict period it, of Just in of actual which over

the Cloud And Okay. Agent?

Yeah.

I quarter So million mentioned months. sold the we $X last last that We had Agents, Cloud reported Cloud $X.X Agents. XX million had over

the So difference is $X.X million net.

Okay. That's better. (XX:XX:XX) Thank you.

Thank the next come Baird. question you. Jayson Noland our And will from line with of

Your now open. line is

on Thank lead conversations Great. Philippe, quality a a couple with Okay. ask generation? you point. ago I potential in it year of you. it from to higher customers did turning did better result weeks wanted RSA, How and and called last or customers differ conversations

no. Oh,

there. reaction services And suddenly, same additional partners, can that I a more very much This – all solution the at And integrated, who they it would saw demonstration very typically really and our in have, really is customers these which looking the us they're Qualys what much happy of we of and are delivering realize that the from VM well our make our more think a yeah. customers, seeing so together all and they we moment, is was like partners that because kind coming that everything leverage. with. it, they we're aha that is the

at which lost solutions, moment. of And many the aha cacophony is with RSA time, So ourselves. contrast including have so which kind many interesting, I of so think you vendors, when that the everybody's this a was

really application ears of platform, a the Qualys out our all seeing in managed, very again, everything is today So really, a one bringing self-updating that partner. way, of very everything well-integrated and of both customers this in rational these to is single way, was our music centrally

And joking just that... to a to had or follow at show cloud up large us everyone saying was the – be he now, claims there, tell we integrator and

exactly. Yeah,

toward and or does that's coming all? buyer market the you. change landscape – at confuse the the is coming competitive that But toward market ...the

services, investments are – of obviously, our in customers becoming are I and already think a today, think high. market happy. which so the to accelerate our buyers to made these course really that the in and past, less new way pretty the confused they to have all with the they penetration ability start And I they now, the essentially is we right of less pretty realize because, start

We Security chapters is came did we with Cloud which, out that Alliances, the one you when I quite would the bullish. essentially which that's which may with recall, Cloud is working as that, initiative XXX of Security about we're very significant, in So, Alliance say, it's the world secure, which on since we – since into And professionals. transformation. are focusing now, to really they've all really, volunteers been And metrics they security are do us with XX,XXX do to XXXX like embarking enable secure the the today, to need the cloud. digital what

our conferences the other about users world course of to in and enabling digital the to customers and So we with to forums bring essentially into experts going to embark – everywhere discuss are transformation.

a at that So, the initiative. ago. something I application. the secondary Vulnerability of had Management We Schmidt late looked a that's significant very done with years similar did was a kind many when time as Howard

we important and only with it so and and experts before other find customers, early adopters took with to and hackers – really to long. our evangelize myself that our because vulnerabilities the Vulnerability why with Howard know simply them, went can few your So, you've Management a was got

evangelizing so for So there. as I've time the been but long, is well the now cloud

with that we full saw call the we transparent did. integration orchestration, what so, we And Azure

do also have day, have Chief cloud but how Security still integration with order speak Microsoft we a what you be that many of architecture which which Officer at people way is to Product but to you Sumedh to back full showcased one. lot essentially which go end absolutely platform our right is that, And is really the we Summit, lot talking the that's could totally everything we've is old of Alliance question that your of do orchestration, that about transparently again, we have orchestration got a how have Azure So, people a have remarkable. integrated. which about at in the there's the showing workflows the And Cloud when,

many that you not there's that So, that because not do something that's easily.

the for color, Thanks Philippe.

line our Thank will question come you. with next Owens of the Capital. Rob from And KeyBanc

Your now line is open.

Thank question. Great. my taking you for

new it have rate I XX% Cloud your been Can kind you in what's the guess, remind of can customers you with remarks of that's one me think if hit quarter other acquisition trending I prepared you of those how your Agent? Agent. in the new and, customer way splice taking customers the mentioned Cloud

Yeah.

quarter, XX% it's right, was quarter. that's last this It Rob. XX% So,

X% over it's of the last So, X% kind quarters. to been two moving

terms In customers quarter varies quarter, I newer new it's to solutions. disproportionately actually buy, quarter and of our would they tend this it by general, say of true in buy what

brought our solutions mix see obviously, we higher in with a by new existing general. new, uptake but new a of So, and are

on or something And can it? it quarter? color Is of you half nature? that any put it a Is

Yeah.

We going historically, haven't something disclosed that forward. can we look providing at it's

just higher versus Okay. second, scanning as market And has in of of like bit that scanning And little the VM to rate. can and speak then you a cloud attach on-prem? you the relative kind seems much some had a acceleration, cloud the look – traditional it

much of coming within point? If your installed from or Azure at you think is you how this within VM scanning look based, AWS do

a – agent, want cloud, one the sense. are really totally make make is the me in have you putting Scanning let Qualys in any network scanner because and So, cloud comment that doesn't in to a the first scanning cloud different. the one scanning

what the we architecture Microsoft. cloud the the right we with That's for really did is have that So one.

on can also and they the a So, Qualys can, in Qualys Center, automatically, is view the of as Azure of them provisioned, And course, thing – go (XX:XX:XX) then customer then the the any Microsoft compares on we posture a mouse, remediation same the up click mouse, gave in their of to Azure. security customer agent and ours. the console a which you any automatically And do to Azure. today Security can go click of

have we the again, a bit of a based enterprise. But installed So newer. agent you on is the architecture. that compared new need is really very a today on see And the our in uptake cloud cloud. to The little we this more that huge of course good

Great, thanks.

Kim from you. our will next Imperial come with And of Thank the Capital. line question Michael

Your line now open. is

guys. Hi. afternoon, Good

you you and over talk about the suite With for can share go-to-market a your Thanks. broadly selling any product how wallet thoughts you and strategy? changing velocity XXXX, may deal capture and have product XX the be your expansion more XX, months, impacting potentially pretty your motion strong how on without roadmap you last more in

Yes.

evolved. So, strategy course of fundamentally not changed, our market but has have

all being I mentioning on built So, earlier, hand, we the engineered there partnerships Qualys significant sources we out being have customers, partners. one becoming sources with engineered see, as was Qualys – all already

word. have done. past, We that, partner have Optiv is Management now the in So and cetera, they this the solution, have of the also very et now at were as what everything channel we of again, looking so large customers that today, (XX:XX) this the Ernst Young, see PwC, us like and & we we Vulnerability benefits more today see

strategic for more and So we're them. more becoming

our of So what on course solutions. doing them training we them more is are new with

So available market thing we're so Group. have these now more well lead for that And generation. services so new services doing, also as customers, our training Alliance and beefed that's are our we up also can more free also Strategic and Also they but on to providing we're forth. create one the

bit adjusting changing force. On the – enterprise, again, our what sales a we're little doing, we're

categories But and, a different divided of doing they customers force recall, that, may our you managers. As is into sales account essentially are as technical farmers, the we of here result the hunters what both are of creating and is technical.

our customers large large, course deployments. Scale large the So, is issue. we the classifying very Google, which like like are Microsoft, et very like extra companies of between cetera, Oracle, been have

we're now we to highly higher have technical we now have And making And even here them. we we we changes sales that technical that are force that's to very a customers And essentially to support starting customers. are so prefer, large you our which close be we customers regular it. that's a if of the here. can category, continuously So, build these account then the managers. making have Then

few continuously make – are easy fact so just tuning which to matter and sorry, experts, to model. a to our think, experts that sure it's very are in with consistent I different again, But that we So, and again, try more We're – subject these it modalities. the buy.

services for customer, So, account to client you have account. immediately, available these expert technical there a and you then are all automatically these even if are we an you evaluate. or existing matter new create can you yourself are help Qualys which And managers a eventually subject

channel, why mentioned as And a natural we why the I'd as on, describe – that's Philippe earlier. distribution that's platform add just

of sales do this And to account investing hiring technical you of an see accelerate opportunity and forward year some in that it. capacity? managers your Got

and very that. We I our all really what sales one, But, is industry on it's model have we technical hard people. there's managed find, mean, our that's as expensive, our to challenge are today that second, and they guys is not extremely are market. are again, find I and to call all. plenty of at good they the The consolidating, doing is

looking the not for. are people that's So, we

the me post because customers, vendors, So, the coming do I are still we're are end theme prefer And – essentially there, people that technical. on know was they which continuing of And the which (XX:XX:XX) see more the which hounded more RSA. of go telling why long. you don't Lyft, our that day type AC if many all they're we vendors too having day, the at was saw RSA, wallets. CSO to at go essentially they their LinkedIn and I at of by because for the the the essentially security more

I time. cacophony so say? of of my So And to and more go vendors Francisco a why it's they should what to waste the and San go essentially meet

Yeah, it. thank absolutely. very Well, Appreciate you much.

Thanks, Michael.

the line And with from Thank come you. of Stifel. next Gur question Talpaz our will

now Your open. line is

Thanks my Great. taking for question.

with XH about I do across Philippe, the think more speaking XXXX, guess as more to that how about? So, in competitive beta and think about new set broadly then of here four you environment hit excited are how you those do importantly, the products most you each ones And which well? Thank you.

question. Yeah, that's broad a

know of because So by don't I them. I'm to all start where excited

let me So, specific. be

important Not far, happy with So are fact enabling today, Agent the be the the to agents are we they most VM discussed, the these fact which are by in endpoint. in new endpoint in Agents to service they the doing now? essentially only the very they IOC. We past, What that because, weren't are additional services. in as do going Cloud Cloud the to are but start the starting doing doing the they are

like to company a starting are we others. So, there and Tanium displace

of additional course for Compromise. is I well and of services detection extremely positioned that's of in the this have – So we're the cloud. there. we This Then greenfield, Indication is totally think

we technology. on a the has We every X website the than another scanning these Six mastered scan CloudView, Sigma. So if with Qualys we do The fact, are that's strategic technology billion the love scans to things. standpoint, very excited technology I as Six a really, IP do passive the than well Sigma can the year planet, scanning from in look is on all – planet, about with really we every that CertView, more way accuracy, because better

mastered. have we technology a that's So,

have agent. The And us the we mastered second technology are information. have to real-time allows now the agent

whether the of capable to is everything visitor these a will And now, whether then which we detected all as information we well. analyzing we scanning the Apple got And launch time, it's an Watch scan being third could in, whether, connects even back-end a on master, bring in it's we fact, network, of we that devices. as at IoT passive the which phone, is So, them coming device, to detected essentially course, technology that the that RSA, if we our well.

bringing these provide That's together users with where is technologies them, can – the global are that now what manage amount into single unique using, significant able technology one have with end with including is which synchronize going so back-end I two the there make they're precision Qualys Inventory we'll think the where we most absolutely essentially in information all them, IT the data Asset and log where combined installed and Elasticsearch that the marketplace. to cetera, billion So, that, how combining us we being before the close your any are Elasticsearch, currently three Nobody devices connected all your more have strategic allows very visibility they being where absolutely seconds, data indexed also in on X.X these application many RAM built three of with everything and the once of able scale and there et being direction different we you the up really points the us than to CMDBs. key year. place to under on information, to be of has with located, capable, the indexed to,

you're for Well, is fair future? it to Philippe, say excited the

focused is have all, profitability way company not really and mean not the But to have we of... of very very mean, me, the is happy, to me, we which I way this on mention really accused everybody this built, not done. we're the we been and are happy I – the have all us. that be when we is we communicate, with we

much of. too Having

it. ...having of too much

the I the given was least it's here directionally, guess, provide with how growth really with of in customers at Melissa, agent, renewal or least up trending, you you as But for some commentary but was dollar and the X+ assume know question trending it. X+ I flat, directional I enough. growth that'd Fair the don't solutions, could hoping well. I maybe there, provide rate been a helpful? would at in you be number

Yeah, absolutely. Gur. Hey,

we've say our given been event in So, you I around performance, provide we focus rate Investor net somewhere We'll positive what we've in seen XXX%. at Day. update at dollar an our that's on virtual trending it But in expansion our it surprise last obviously, can June. manner. was It won't provided obviously and a

Thank That's you. helpful.

the Siti will of Thank from Fargo. our Wells come line next question with you. And Panigrahi

now open. is Your line

to So more revenue my meaningful are think like about what see some are so and wanted see just taking calls. products versus make to update, been pipeline. future you're half adoption question actually year, I in that I contribution quicker was have switching easier that launch near GA-ing in the for probably you question. asked. you the products and have planning products what later seeing products be term? But, of between And has the I of this if when the first six maybe already the four already midterm sort products you Thanks products the this that these guys. understand pipeline, Philippe, some to Hi, of My long excited some adoption? are apology versus

bit think I each and adoption but all the So, contribution different little other they is anyway. a revenue – – help

our free you CloudView that may earlier, upgraded more are today, So, were free few saw, as launched on already have on weeks, services service, so we've not call, you adoption. two in registered do our have for about be need the free beauty very in about we bullish about mentioned is we and the we a that that, one, weeks, so useful to it's who X,XXX-plus very people GA, they these big we service. The something CertView, of people to we're go very anticipating do. services I've

et then of going to Internet. many thing they cetera, these where cloud, And know the when need your So how certificates inventory signed are, in who (XX:XX:XX) are them you expire. know buckets, the need are three to or them, to same to you exposed,

are And course we must-have significant upsell. application. they absolutely that's have then So of

of And the were now Internet-facing endpoints service, So two but we additional we upsell thing not we opportunities a upsell Security will doing certificates, we the you. Assessment. customer and upsell creates do they on it or now your CloudView the things. creates them, of with to your surcharge, One, if it to then know sell your were you with have for us. those it for the also And assessment they Qualys can because, management didn't have awareness now upsell us can Internet on them who us certificates the does to significant before their maybe using once same knowing inventory, also you

very these well. So – they started are have

all that, with excited is very approach, all (XX:XX:XX) greenfield and this we're So greenfield.

of other we're are identify better because they we we're to that take because our passive these with are able The very our are going now defined. is to even those which scanning, something So, quarantine is the we devices counting improving be which And which really be are starting important to IOC Compliance. key to thing going are essentially think Policy on, see the the and I then improving the we really course off. suspects, services (XX:XX:XX) VM, we have

companies so, which all, we're very we in XMobility, attracting head in really acquiring people have of India good I with very count again, now is now, where we we're a very ops and think continuing that XX% happy what we and, engineering management with as our doing. did good all we're as And few And very well. can – said product we integrate

And course. so, we're currently of – so we're continuing doing that

Great. the Philippe. color, Thanks for

question come will our with And you. Patrick Thank Colville from Arete the last Research. of line

Your line is open. now

my taking for Thanks Hey. question.

end? you So, the guys full the the peaked behind in quarter year revenue. guidance the at not thinking lifting on top What was

Yeah.

it's have year, healthy Patrick. the early So we But we year. and outlook, to in similar last quarter a very had great a

to full-year And we wanted mind, as the well. and keep the of that there tougher comps Also, the top we as in we midpoint revenue how the maintain do second for in guidance so, keep end into in have the the guidance to it factored chose so is. half bottom we raise end

Got it.

I – the aren't earlier think your on contract you hear that so duration, I longer right? that Did just and guys contracts. sales said call incentivized in (XX:XX:XX) the

That's correct.

why in the down Okay. color any And I tick reason the a mean, was around could you there that? give for margin, us slight gross

Yeah.

expense, products in moving corporate count it year, to be gross last over GA said guide as invest continue don't and materially different into head drove years. we is, margin, we've products into higher platform the it's to and We we're from few depreciation. This beta what we our the So, allocations beta. of than been new the expect robustness don't where to

dilution can repurchase, question the the on And is of (XX:XX:XX) you income the are on Okay. last (XX:XX:XX) right, objectives my that just the share right? tell statements, to that me neutralize

you repeat that? Patrick. Sorry, Can

Is it the objectives dilution you are? Sorry, the stock-based share remind to me neutralize can what from that repurchase, compensation? of just

Yeah.

on order our cash M&A to value drive of of operational back, acquisitions take use we're we our cash. our as our And significant highly cash continue you been are continue when to are But step we've generative, a tuck-ins, absolutely, we profitable focusing use of a we going very to of to in model. strategically, a So, very shareholders. then it's and likely which for that cash, that be think amounts generate up lot proud

shares. by in offset it that So sometimes either repurchasing equity we we or the employees grants M&A made thought sense from to to dilution have situations

other in of we SBC, compared also add And as could that to reasonable we're term pretty companies.

correct. That's

Yeah.

Okay. so much. Thank you

Sure.

question with last our And will come you. JPMorgan. the Auty line of from Thank Sterling Thanks.

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again It's for Hey. Ugam Sterling. Kamat

impact guidance FX of for follow is you FX February expectations gave EPS to in when on for much your guidance how up, increase the an XXXX, Just tailwind having right now? like, the versus expectations

question. great increase actually our EPS driven guidance by impacted outperformance. it. It a Yeah. in really The hasn't is That's

right. All Perfect. you. Thank

Thank our in for question-and-answer disconnect. Everybody, Ladies participation concludes thank day. session wonderful a today. program and have This we today's you. This does your gentlemen, for all conference. you conclude our and may