Qualys (QLYS) 11 Feb 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Qualys' Fourth Quarter 2020 Investor Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's conference call is being recorded. I will now turn the conference over to your speaker today, Vin Rao, Vice President, Corporate Development and Investor Relations. begin. may you Sir,

welcome fourth and call. XXXX to afternoon, quarter Qualys' earnings Good

me results Joo CEO, CFO. our to Mi Sumedh our Joining discuss interim are today Thakar, our Kim, and

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

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

to to and the the our site. remarks, Investor like release, that, prepared Relations are Sumedh. Web presentation a reminder, I'd on As section available over press of call investor With the turn

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

Before words we to about wanted issued discuss few afternoon. our financial say the we a results, I this separate announcement

Chief by Directors me this as speedy disclosed due recovery. Philippe that our connection appointed we Courtot in development, seen In a a Officer. Please interim now, issues to health absence to Board have leave unrelated taking wishing the of me likely of As to Executive you is COVID-XX. has Philippe join

cloud-based I secure Qualys Philippe XX of with solutions. Qualys' and and platform compliance IT and transformation President of been and CEO. honored have as October serve years, I we Product who know, is applications the appreciation way look to following I driving you the June I've share our with continue for with vision out. team XXXX years. and best-in-class been of the closely on for with customers appointed Qualys same working platform business the lead and transformation, infrastructure company the in the deep our IT tremendous rest our have transforming Board forward forward organization's been to closely have to and Officer those appointed of strong the Philippe interim Chief to XXXX. many while built, protect we have I the nearly for their security building am momentum Qualys was I working in and As

my for walk quarter in our through first fourth and Now, task XXXX. the earnings role, full-year I'll results for this you

solid are pleased to growth and profitability. quarter revenue report We another of

year-over-year uniquely, natively our more the entire environment, XX% We for which technology also our cloud of to of the agent subscriptions, our IT, underlying our saw solutions grew integrated Cloud paid compliance hybrid light-weight provides and security, a XX Agent than million. multi-function, Very on number growth strong that and platform. are visibility across is

Management, (Vulnerability in the agent, deploy EDR, through offering XDR and Qualys Patch upcoming Detection IT Detection File a result, single Response), Global Compliance, differentiates Multi-Vector and Monitoring, industry. Inventory, VMDR, and As Management, customers which Asset a can us (Endpoint Policy Response), Integrity our

quickly expand enabling to actions, In customers environment. to take security addition, our to response their capabilities issues we platform's in continue our respond to

to high of to looking risks quickly to remains for vulnerability our management able ways these they risk, importance to for for the are customers and respond be threats. their While mitigate also them

like attacks, and their Qualys glass, our ability to As synchronization, IT pane Management VMDR mitigate complete uniquely and and ongoing a responding inventory as solution. as do respond XDR to with risk and well CMDB EDR using single capabilities and these to focus & through organizations upcoming attacks risk provides Patch our hybrid increase all continue discovering breaches to asset platform, their of customers their mitigating their detecting detect on of assets,

release the are we now as customers well their Response our the SaaSDR additional Qualys well and protection Cloud new With capabilities as the on upcoming other Cloud our solution as runtime opportunities tools giving to expanding of in environments container solution, similar to security infrastructure consolidate Platform.

because management asset paid QX, gateways. patch easily growth strong newer through to VPN Management a our our effectively selected vulnerability without In available single discover leading chose our a ability of see several and terms continue solutions, pharmaceutical to endpoints competing given Qualys solution. of our to remote its management Patch agent. patch In management, solutions, application the from over They inventory, using on their and firm limited ability bandwidth patch we

environments, their also of quarter Asset strong of application assets paid and end media synchronize to our This we gain a and their for with application saw visibility Global traction life identify all Inventory installed IT the multiple conglomerate Discovery large ServiceNow the adopting known unknown their and across CMDB. software, with of

a our adoption again Management, services saw management, we large Qualys. application vulnerability Container our for Finally, company Patch robust security their stack with Global Inventory, solutions Asset that consolidating and IT from Integrity global has Security Monitoring, further File growth with EDR already deployed

Product our make of we roadmap. on to strong progress product terms Innovation, In continued have

Response SUNBURST the Delivering devices free to assess include: their quickly immediately Management Detection patch Some using same and our capability and SolarWinds by click fix detections, use XX-day Red and Trojan with FireEye Vulnerability impacted a stolen exposure to single customers agent. Orion Team key service tools, management recent a integrated accomplishments vulnerabilities, the

data that posture called their monitor SaaS their Solution applications to of the gap and compliance enforcement Runtime and Security. of environment, as Zoom. bridge SaaS with enables brand-new Qualys visibility, delivery Salesforce, teams between gain Response platform. capabilities, platform Qualys on-prem assets, single addition like helping continuous SaaS and automated and Detection a We OXXX, which critical a well IT enhanced the recently security, through again extension and of to to applications SaaS as critical introduced defense (SaaSDR), of for our the with our G-Suite, single also to as well deep access runtime solution This We a in security console users customers Security as Response, visibility, have Container provides

are and excited Android mobile devices. iOS Management Response) to we VMDR are addition also We and for expanding with Detection Cloud enterprise Qualys support (Vulnerability the devices that of Agent

earlier our hunting, additional devices. shipping As Cloud Qualys for Platform proactive with misconfigurations more further conduct of part allows track appropriate from which Agent of It leverage EDR, builds actions. organizations amongst take mitigation expansion on leverages critical customers devices response and to actions. are, mobile on of This product data on their access vulnerabilities continue response breaches. Key take with to This more to ongoing digital capabilities providing the Qualys transformation, accomplishments them and and detect these devices Multi-Vector endpoints, in business our these correlates handheld Cloud threats other to appropriate threat and to XXXX. threats from unique conduct from and Qualys vulnerabilities top

a within comprehensive with part of Management sync and inventory designation also Connector Partner ServiceNow Service a Technology Configuration Graph Service the new Program. Database, Program, Graph their We released new (CMDB), as

the of launch entire unique cloud workflow vulnerability a last single end-to-end VMDR management, strategic automates cloud-based the prioritization, is that environments, and application all-in-one patching With with endpoints, across single year, into threat brining agent. on-premise, and vulnerability while management lifecycle a early

and detect XXXX. XDR customers correlates additional This that expansion, integrates, seamlessly natively with Qualys complexity beyond customers, in are capability solutions private threats enthused have will orchestrate SIEM plan The we additional been various introduce endpoints. with about help XDR all and we powerful deploying to the reduce of the platform ahead, managing design and who let working and collected third-party response which beta us. select Qualys This SOAR data is context sources. solutions. customers will from Looking actions, from other sensors cost in and with capability also our partner data currently

customers Patch for on support Cloud Patch for Agents expand also Management devices. can with additional so to these plan also Management Qualys Linux environments add to these environments, We

to Linux Capability, expanding well We such Protection (NYSEARCA:EPP), EDR support Endpoint our as will capabilities additional continue environments. into as Multi-Vector as EDR adding

now our detection possible was technology new consolidate and at we event, which IoT X,XXX solutions our incremental our and on event platform will We scanning engineering made Technology passive XXX a initiatives update is cloud, analysts Industrial well their people Operational massive are and cost-effectively talent with over to market virtual India. us. all in our significantly in very single-pane-of-glass significant of Systems, our showcased positive prospects, pace them compliance security in view held attended also that expand we these XXXX. very opportunities allow a We Control base, media base customers investment of They at XX-day rapid environments, Pune, Over a our SaaS, because while as coverage QSC of customer November environments. The solutions easily our conference, solutions, well-attended as the partners, enterprise working to native the such received cloud across and development a across and these providing strong assets of user feedback. for These traditional investors, on-prem, open employees devices. and endpoints, of the with stack major of mobile and

relationships Go-to-Market, of with are terms expanding existing we In partners.

to amount increasingly upsell comprehensive can they a other multiple integrate response of platform customers, instead with point to MSSP multiple easy themselves platform Our on such strategic services their is for large becoming having and focusing detection scalable and as provide partners resources solutions. building of

breadth is the and now for Given profitable of customers and of leverage EDR, key a suite and This launch and initiatives we our a the additional Multi-Vector element product that efficiency embarked have our cloud driving of platform. effectiveness on our of increased shareholders. our growth, go-to-market the value VMDR few

XXXX services. cloud lead in included: our for generation with activities go-to-market platform free Leveraging Our

free them visibility, Digital Anywhere, establishing Qualys solutions We the Advisory to in operations support further it do remote where expanded partnered launched and using Deloitte region. Cloud of VMDR industry-leading by reach Deloitte security solutions this into that Remote VMDR continents Platform into our Kong UAE global China, was we Multi-Vector a difficult and with IT China remote Armor EDR Protection an partnerships an Private a Advisory, which by a to security providing and enterprises embedded cloud our China. solution in for Deloitte As with VPN. with Armor, Cloud largest secure Platform these their instant in platform. workforces We MSSP, assessment, our expanded global services. Qualys into integrated enterprises products, managed enterprise to Qualys' provider and vulnerability partnership across example, integrate launched patching Endpoint help Hong value-added over the when Dubai, Qualys Cyber's for extended We

Cloud. Armor on availability click Google Cloud general posture CloudView Cloud, public environment. cloud security compliance Agent's customers visibility in also workload with for Google a announced partnership of solution includes providing and one management security Qualys Our with We

outside digital partnered Security of EDR managed Registry. a Container Azure our integrated the with We offering. servers Solution with natively allow to into consulting, include security Artifact also we Vulnerability and Microsoft platform. Platform, Multi-Vector Management Google services expanded scanning to integration on VMDR leader perform in to customers Next Additionally, Infosys, service and to with next-generation Cloud integrate global We Microsoft vulnerability Cyber Qualys a its Azure Arc

While of the looking number efforts platform. increased to cloud our offerings. expand building forward marketing we and on plan our marketing VMDR our meaningfully a to our sales are XDR we EDR, to as our game-changing XXXX, solutions, as and upcoming well including Multi-Vector platform, efforts, Similar given

platform lead recently generation awareness initiatives C-levels events. the and increasing marketing our capabilities, have and CMO, hired our our well are as a for leveraging expanding as We virtual

the front, Strategic our of a as of Americas, for and quota we a the technical VP headcount New call we recruited managers and expanding Operations of have or Alliances business. Integrators, U.S., account them, and EVP GM sales sales Field for for for System an carrying our VP SME/SMB Business VP On are

this planning hire Chief we Officer addition, CRO, In are a to Revenue also year.

to going is and world going invest in us the the to for other accelerate going long-term reducing flexibility, functions profitable Qualys cloud-based set are as drastically which advantage. R&D the Increasing for while the compliance management we to reducing continues across combined its well passive greater environment future their different. believe also In to beyond as and up growth. continue span scalability. that security, our our stacks threat of growth. technology, We COVID-XX on vulnerability and to operations in and to We customers as with believe accuracy, with to agents more risk to breadth adoption platform, well the enables these offer solutions. investments business be overall us, spend. hybrid competitive mitigation consolidate increase costs, focused organization IT scale will providing conclusion, be will positions significantly and response while transition increasing and to solutions and Qualys us well our their and well cloud clearly is to enable of after Companies also detection anticipation continue customers on support We the same entire visibility, move This scanning

that Patch our guidance. over including to optimistic now existing financial customers, the the Security to solve growth customers the are quarter expand come. discuss Management, base expand the and fourth with results adoption fiscal opportunity summary, customer With increase full-year XXXX call We our Multi-Vector well bookings for well-positioned we and Joo I'll continuing upcoming which turn to for the to our us our the revenues our over as Container that, to problems are years as provide meaningful Mi solutions, EDR, to we believe that of newer long-term. In XDR, will

and Sumedh, Thanks, good afternoon.

I'd except and to based growth stated financial are for subscriptions, unless growth year that, revenue profitability. rates figures for lays prior delighted cloud all industry-leading foundation comparisons start, revenue, agent on non-GAAP, the I which note to our future period, and with like otherwise. the Before increasing We're are

fourth operational Our highlights $XX.X to include: grew XXXX Revenues quarter financial for XX% of the QX million. and

subscriptions QX expect duration XXXX forward, the timing prepaid and Looking of to we negatively as be by invoicing. growth multi-year current calculated amount shorter as well billings impacted

Our size average decreased deal X%.

last alliance Paid VM up million into a QX channel renewed twelve off up impact VMDR subscriptions OEM (normalizing coming the from XXXX. for deals, to relationship), customers Excluding months, agent XX the in subscription. in of strategic XX for XX size ended of for increased over renewal increased the million deal X%. XX% And cloud months an the quarter customers

deals, Excluding similar alliance XX%, VMDR strategic adoption to was QX.

superior XX% our free Adjusted to the and XX% Our EBITDA million $XX.X a to generate quarter cash margin was operations we our under scalable expenditures significant capital flow generated versus $XX.X on the to And for XX%. for representing margins continues continued QX, shares. and increased quarter cash the XXXX we million lease principal for operations, back million, of $X.X EPS including In obligations, platform of XXXX cash model of drive representing repurchase a grew million, outstanding including margin. fourth XX% $XX.X fourth invest QX flow. XX%. to into Qualys capital payments from XXX,XXX

growing million achieved cash our XX%. our the Looking of enhancements. and In million million of by remain And to suite foundation revenues, several finally, applications. recurring X.X in repurchase and margins confident back shareholders. XX%. of our we of leadership we flow earnings for proud and our We of We product record an driven adoption EBITDA shares. utilized Agents grew approximately million. we cash outstanding We EBITDA year, to business and over by XXX% on released expanding XXXX, XX% from by model, nearly $XXX.X EPS our are new continued have features subscriptions to XX grew while XX Cloud meaningfully grew products, Cloud Agent XX%, our

about we opportunities the Looking Patch new Management VMDR, excited revenue our solutions, EDR. growth are from Multi-Vector including to and XXXX,

$XXX.X of million We be XX%. XXXX in represents XX% expect growth which full-year in revenue range million, to rate $XXX.X the of a to to

terms In profitable XXXX future revenue ability invest leveraging further model, expect maintain to profitability, we industry-leading our growth. to the operational of while to drive margins preserving highly

be to of to XXXX non-GAAP in $X.XX full-year in expect $X.XX. We EPS the range

in to For $XX.X which expect the XX% revenue a growth range rate million QX, represents million, XX%. be to we to of of $XX.X

to $X.XX. range non-GAAP expect in of the QX to in We be EPS $X.XX

$X of the million capital $XX We in in of expenditures million operations to million. XXXX to to million full-year range be quarter and expect from a XXXX $XX first to of range $X be

excited and With value uncertainty questions. are profitable to robust We VMDR confident EDR optimistic our operational of Sumedh as to future. we mentioned, the about any by highly scalable remain your and the As of model. we and and launch the our our answer due by of well of adoption very feel provided I are Multi-Vector this Platform Sumedh underlying Cloud period that, during solution, happy very company's the as

Our Daniel with comes question Instructions] [Operator you. Thank Wedbush. from first Ives

Your open. line is

send [Technical difficulty] well and with things Philippe, regards.

the just seeing spend, just cyber we're and about the both increased back environment in deals, look, terms security can this to across of business, federal. we that talk the board So of enterprise larger in terms

you positioned where something about are guys for terms you talk Just year? increased is I there, Thanks. in that mean you're seeing of that giving confidence the

especially out them capabilities [technical their at the detect find right seeing or help of think aspects as are integrate able work detection and the And what security, or take where breaches. that really are like to that well quicker you on lot with the that And a quickly, and of the Qualys that the they mitigation I is takes environment, across issues plethora in are is going on if I to our is the something this see point feel to point they long as look and And so when, of platform getting platform that going current capability, to solutions see this the into as of have to that for them. time is now of mitigate that. some these their what these get difficulty] that response to they value doing. ingest examples those we VMDR, because response that can well agents there, in actions them can platform looking EDRs Yes, we both with to customers, customers the misconfigurations already obviously, attacks, which we're solutions the so solutions breaches recent example, our mentioned, information that faster are that they they couple risk positioned a of agent are looking of consolidate which we focuses our with for and feel as the be different and that that it threat to an a patch the customers we our are add today, lead conversations otherwise management adding as

Some so of brings can value it of to them. the of it they platform see services what part is and the free the

that a get putting be consolidate essentially from able just issues also a looking spend, and through will the faster cetera, lot at feel large spending weed for like analysts of to we to So solutions Qualys the their amount quicker issues having just SIEM, these et have. security and not then than solutions, together of find solution to dollars perspective being point they rather to a but the customers having that those of to on through

you. thank Great,

Thank you.

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

is line open. Your

to VMDR starting Again, you Philippe, guide. the to there on and are about. growth, and XX%. the thinking for It year, the through a But Joo better shouldn't question hear a other revenue trying tailwind kind Mi, we recovery. based the with growth if of lead quick consistent of that year-over-year you. expect the looks quick are in understand lead sorry growth like about XX% your for not being Thank just to year, year, the QX somewhat the adoption to on expecting second-half see a we're dynamics for guidance to hope guidance

newer. that Yes, we're EDR, about so VMDR Multi-Vector newer Patch optimistic Management, solutions, with true which even is it's very the

ahead. latter for the guided to QX, the to that the achieve that when then to of because revenue inform that our to to the opportunity adoption it's is the we have bookings right in tell, we on product of going little thought it's that we to look based prudent to what a historically and the what XX% and And setting we for guidance. see at And we've a the this visibility basically year, of full-year. revenue too half is translate that current guidance, second-half have XX% to of annual but guide is, was growth bit really the when it our expect the uncertain. the guidance early we bit pipeline However, into now, And we newer

year I really and we drives asking do takes a they that quickly see to some once it weeks. to move move in adoption very also add the for that time it. services is have their to take that, saw are cases, and that of can within based we security add to their we earlier customers the integrate we deploy that In the for. base they VMDR that then that, which seeing, customers capabilities additional before definitely to other some are so the into agent, couple something environment time And gave if see forms VMDR as example, And on on VMDR, to portfolio additional customers them can but able

CEO Okay, going great. well. on Sumedh, first, adoption the congrats the And appointment. VMDR Clearly is

up. from At You least have XDR have now. the guys a big product the become platform provider definitely launch perspective, coming full you

add And force year? step in environment [indiscernible] plans hyperscale that any can Thanks. your -- are largely to your regards So to to aggressive the of also, the environment, in lot hyperscale as into customer by cloud and go the new prepared channel, In remarks ramp. the some next you that channel market, plan, you and and go-to-market those such capacity adds? are give update cloud is how driven obviously is and trying hiring you'll us sales this planning a sales is the but there insight

address think on started motion, sales I first to I already the think you the we've as so hiring. saw, Yes, on

doing, it's and for a I U.S., so hiring for VP U.S., As GM mentioned, new be sales the Chief VP Operations SMB just business mentioned, And in Revenue not many hiring the people. as an other we'll I SME, a then, we the EVP for also Officer And and of things that year. hired in there's business. this we're Field have

plan count addition platform folks, but CMO. hiring we've bolstered our our also marketing Of sales of in course, increase to we a carrying really the quota

VMDR, and enablement. platform, team better heads sales to better of hired also a sales work -- for other with help areas, a the our really cloud few for these few VP We package product of and of Product

optimistic will of that's a so, are in I of the is really and future. there just all about And to going in expansion we the we of those what proceed terms how in think the the combination drive revenue. things there, are And strategy

into since capability, where far and the quickly environment is that's Azure platform customers As just moving to goal, be patching, and some leverage the is a but think cloud of the data, cases, our this need lot to as monitoring, FedRAMP, I it not cloud hosting allows environment vulnerability they like file management, integrity really built-in GCP able the critical who in about environments EDR. they are need -- these

provide So, they the well-positioned we to agent. are once those get

about we who into So announcements integrated agent and an Google, be -- what getting their platform, then happened are integrated get backend it could customers and focused of the talk is backend to with in is XXXX, integration that that so and Azure, mix. just a we and our everyone the see those --

at so provide then visibility visibility within Qualys able need overall the In their they quick solution, are security it's the hybrid Azure what end-users a integration can built-in do the portfolio for build new security to quickly the fix. capability. to team approach, they leverage is in They a to existing cases, looking they who capabilities. they of platform have certain Whereas that customers Sometimes leverage built-in other the into console. take the where Qualys like customers look

integration, to is those also quickly, of re-architecture feel capabilities opportunity to on we solution, think are pretty those cloud their environments. we virtual dropped as seamlessly add more robust a the then into provide So running because that in more I that real and moving agent native devices more organizations

Great, Sumedh. the again, thank you that answer, on much appointment congrats so for and detailed

Thank you.

Thank you.

RBC from Markets. Hedberg question Capital next Matt Our of comes

line Your is open.

question, to and go well. as for thanks Philippe thoughts taking my Great, our

You really guys just if you assume not platform. it SUNBURST the your kind And if talk guidance, has in obviously you initiative? a about and benefits and SolarWinds go-to-market releases if aided you QX it talking but that's lot revenue, of pipeline probably of your Qualys curious it including I'm of didn't helping guys out the generation, but you're talk had I when pipeline impact about, of hit, press could about, the helpful sort would

One We approach, like we just point services these it's like did first and Well, and put solution. we free two-prong of two obviously like is these with right? the sort services put staff don't purchased, security -- foremost that their get our of haven't able environment some but Qualys they modules maybe able existing have to to then use now risk. we the help customers, that mitigate right use to handle a out

we when that we gate, of service detection the we a really there. tools, unique like we So, where out XX-day part that that FireEye were around vulnerabilities that in we was as did providing these free of the just solar -- the not published is was stolen which are millions --

the these of it's generates that Qualys turn not right? these "Hey, platform." vulnerabilities, where these the is free already a them additional there. the credibility the difference, we quickly you're can So obviously have additional can from move to and grow agent also which see ease they at can them Qualys few customers end for a the proof-of-concept see they the let's help call just can with that is solution our it coming of once for that doesn't is they things capabilities big and purchase there the VMDR, maybe existing on is We not to Patch if for or ability that whenever like using that you're that Patch place if see or that, a that, for customers, or a the it leverage findings and on at established, to use that once while of the to is Management is, have ease And saying, like VMDR, where a they and already foundation day And provided here, hosts leverage the us can and a creates but establish Qualys up that they you're there patch replacement. those vulnerabilities, and scan it Management to going necessarily for focus you capability understand mean you for move to to have that able you quickly, run the that's solution, hours, does it you solution patch that renewal we in on. immediately lead what they customer immediately And really goal the already within that

the at more as opportunity on them subscription buy, look go-to-market really which being for And "Hey, events really comfort, them if a to you a that to but we ability We to buy, so, customers within to is that is on able the couple can free have of don't showcase buy, them, just our it their platform. to there know, that for hours, showcase these capabilities see EDR work our you already just critical the services, the creating key being of have service with systems." push agent a and of we to part an immediately. the to their And key schedule you

helpful. kind then growth. just lot seeing into of to That's growth. Obviously, core I of And dig or ask, a kind of wanted VM you're

of bit, of year, helpful? trying of that, question sort products growth to like I there's lot of got mean, like growth would VM rate. I there of a Cloud about or growth. core better a are a you're with new of just of XX% guide how VM XX% core and it XX% launching, but get VM suppressing be kind Obviously, this the something just talked I aiding, Agent growth sense is that kind my of a this headwind, is thinking outside but of about XX% think You that XX%, Is as that's subscription mean, you've kind a COVID to I guess to

right, changed year, Well, with VMDI. I core VM we really game for the last mean VM the

was and by team. has have look Qualys really to a an that, existing solution, together list tell VM is just transformed Management in issues from they as CVs does ability right? of Management me Solution a the does, that the fix excitement see you the an that customers move Patch where Patch to may can in agent, really so, a you they want about Vulnerability that's And single move in to includes when capability as obviously But that example, past prioritization been to the it of which a different single our And security to at VMDR and why do well. and those team they Management those the all

sorry, where to VMDR these solution as through the start last some we smaller customer and assets go to time to weeks. -- a a saw some patching We move customers Patch XXX,XXX driving Management figure a they we out work may VMDR the year was Patch in teams there's for is process that -- areas within the into integrate see right to their in may VMDR way with had cases In also in certain cases, some they Qualys they Management internally So in with that they cases. because through customer for cases, already their in sale well. takes to able had maybe two

for based are it's where journey, environment. different and on different just they So customers their their

drove taking quicker patching other go implementing endpoint their are remote process In we in that patch to for So, cases, solutions. management. these with through adoption of their of need longer cases, teams some COVID, saw

very much. Thank you

you. Thank

comes question of Securities. Our Seyrafi FBN Shebly from next

open. is line Your

you're Yes, it's you year you when grow for I potential early very about you so do to much. ramp. later the next products the think there all But to whether know potential thank Can growth the or waiting mid-teens? new to the for mid-teens? the year, they reaccelerate maybe is the ramping, to in talk this company

just VM core but like getting additional announced new also you the VMDR, we've SaaS platform environments. we focusing that on you really in the and Obviously, some been saw now into and saw of the as right services

as later focus has a consolidate the for to that that maybe able this looking few to year, in Qualys move next whenever to level we year, are our to is up customers what where that months been platform. capabilities early the have to get the all be platform of lined So into them is

we market are these initiative And all of so in have place. that and hopeful put changes with additional that we global

of growth the near in acceleration an for in -- hopeful years. few the are We next

with also who percentage of VMDR. And renewal, VM Okay. up customer your renewed for is

grow? much. percentage be the adjusted really the say do think it like you think didn't that was I end Why grow going last it of do didn't It year? to quarter. same see And that you where the XX% as

of that good percentage adoption our larger. an So I especially are is think a you XX% have we customers, that think for customers when

is is particular quarter, that what in depends for of really it the that mix renewal. So up customers

for customers and So capabilities deduction additional take as prioritization. a asset because time to, that feet not and to VMDR, with inventory whatever have comes like if patch who it's going are vulnerability those reason you see just the with management

to current that able program. need customers ingest, and into also be capability their to security the So

some their cetera. lineup calls, that to to on need so, get And maybe resource may et developers API side

depends are as it's push, on because but obviously we expect to push, So of mix comes people them business, they these what quarter that, do we subscription-based what and do from customers had what push you don't up converted. know just really to a we it it that is ready do already

the right. of build on quarters conversions around, the So the will that next as done, come existing top we've convergence already

converted through more obviously customer the So our getting more next see see that we few base will we and to VMDR. of quarters,

you. Thank

Thank you.

Our next from JMP question comes Securities. of Suppiger Erik

is line Your open.

again wishes I you've you you hiring, my as hiring there? recovery it best like are and but was past. Philippe. could send our the for to efforts hiring for up hiring impression been going step your to you're in going quickly just in speedy in to a as The accelerate do Question sounds What sales sales,

right. last we sales quarters couple and that started that marketing, as hiring of I of on done, key so the saw hires the already have you list Yes, in in the have - we've the already the to journey with accelerate think, we

not we help are So the of people, sales bringing but but key mentioned, as positioning who side, towards as who Officer a what that quota solutions. our mentioned, enablement option also, an the just to CMO to as I can to to our And in are part focused approach Revenue hires accelerating like security the Qualys will also product that on as headcount in positioning on to I and going bringing and we that, be have customers, platform, addition have having the going portfolio, side, our at hired folks have sales sales the carrying well some on VPs as additional we in these approach to revenue. a look their in them do, done and existing hiring do come our better are things we the various

already So that's that and going the direction we've really that started today. journey on we're

do that you are terms Upper think target investments? fall in be longer-term you're how XXs, Are if to will of going your you're looking you some targets? you to at now the be margin operating term of Then longer right your going where with stepping-up in

XX%. margin, Yes, margin now, it have of so better right I regardless. focused don't we growth we think and we mean record about this year, where really have industry leading we wouldn't it's a EBITDA see balancing with profitability, We an leading set we're a margins industry is, scenario

hiring I was, very be as and the which that hiring we will sales will really we've of before investment, said be Sumedh leaders that as at we come traction was happening place. in have has still increase and on been optimistic G&A, think leadership, able about range. a above especially that our we as in So operations with a as in that in great following turn, the the acceleration and customer that we end will marketing, we R&D, be profile and marketing front, an have with as day revenue, because And well the think as talked an think investment, leadership, even margin sales will in well acceleration the to with long the as XX% EBITDA meet, the do support

XX% it XX%. Okay, said you will say? Did you or around above and be

XX%. Yes, it'll be above

Okay, very good, thank you.

Thank you.

JPMorgan. comes of Sterling Auty question next from Our

is line Your open.

the question. This is Matt, on for Sterling, thanks for taking

channel OEM bit more could quarter? if few quarter for you the affecting was just is if wondering elaborate of that that next and solution, your turned a metrics, off to the any impact partner a that, excluding revenue, You how mentioned Thanks. terms guidance in a on your there and

it's right of customers, for channel it's a actually Yes, trend, we're relationship. an OEM normalizing off not coming just to

come So wasn't direct. they where decided to deal, had partner had under different relationships. OEM customers, a one partner, and it for the endpoints, strategic example, alliance we multiple That

so QX. up that the And end did of number renewal deals for obviously, renewal in up

for it nicely. at the being it's up normalizing if a for that into dollar impact trending renewal quota XX% as look up so about VMDR. noise, And the take customers you IBM into renewed on And ended well, were

So a negative at it impact all. wasn't

fair, that Great, that's clearing helpful for up.

of just additional mix? deferred quarter, any long-term to could impact long-term level provide part jump a you this an higher Thanks. if we as and expect overall color that big Just on a of the in follow-up a deferred kind question, there's we're should trying see of

by driven Yes, really customer. that's

XX-K. not to a on. a our value our how RPO more So what contract seen disclosed in And up. our going for VMDR, testament by we've has they're XX-Q It's I been that's we've think up with that And seen year. actually the sign product, length see and trending and to that's afraid average been than customers is the really demonstrated then is in

so And customers said, we that to like the up really that really something customer. push long-term it's that drove not an on in it's Sumedh but deferred, increase

sign it's in our willing for reflected And in, so year, it it's them, lock that's lock the for better up a they they're more to to and than pricing, financials. as great

Great, thanks guys.

you. Thank

Chokshi Northland question next comes from Capital. Our of Nehal

line Your is open.

you. thank Yes,

context So are growth growth, short guiding other saw it about, I double-click deceleration In short-term strategic billings excluding around. on all. the maybe anything just not I want to at seems robust understand, full-year a it that the good to term your like of guidance in billings, basis, the reality, XX% relationship XQ for given in why recent the revenue the short-term is affecting which you you that to you quarter? want just and on Anyhow, talked most the good 'XX billings it billings of the like in seems way and XX% billings or was the

are look QX, is but based in it revenue, current by approximately and takes, QX billings to first, base right. ASV, revenue they're in example if a fluctuate, so based billing over customer is just X% our XX% being X% QX the if in look already recall, XX to having strong the place an total as on actually which taking QX then at schedule, amortize was up increased billings our tend in for the amortization current Yes, and and subscription at puts impact fluctuation. you impact kicked booked may to XXXX ends our a the that revenues And current you you XX%, earlier natural months, a there up on take prior take

ending number the this so, end estimating QX lighter, to because the gets quarter quarter is XX%. factor is impacted. just And we the other then typically now, the that at is days the of of And that have about right that visibility want or will I highlight

this a quarter, of the year-over-year, guidance and so losing we're we're the especially revenue in actually as day and So in losing terms that quarter-over- losing, we're well. days, quarter, two impacts the that

customer it that's helpful. have, not you spend that see good. a recurring that in data due possible slide that segment guys Is capture? XX you're does to slide the attest And from seeing increasing look there platform I It elevated necessarily approach. but Slide then does that to SME is particular the does churn

or really retention, is enterprise In changed, been growth, impacted significant potentially in very rate, SMEs. terms think retention trend and nothing we've seen strong new strong and downward I COVID from our we of retention, that's of but both has honestly, what's seen haven't upsell, terms in a

Okay, thank you.

you. Thank

Our of Fodderwala Morgan next Hamza question from Stanley. comes

Your open. line is

the I'd recovery. to I I'm for like both of specifically, a trying a to figure follow-up Philippe December. and speak terms to comes lot? for question are out winds, that know But discovery away in also I about attack my something prioritization drill solar lot I a the exposed? really your into happened you're Sumedh, wondering, area, about in on question, heard to coming up to you what best customers, pipeline. of not Specifically, customer see Right anything And bit service? we've chain wind the this a conversations little that's attack, wishes think asset you, because IT that taking when of that my one Can speedy a supply want out you kind assets to of going solar right, you my first Thank that your to of was, question. extend kind talk is in

into something supply and hearing the our a we're came you movement is movement customers, was where in, if was mechanics the attack, chain, the lateral there within this look little from lateral of of the was trojanized software but the also environment, absolutely, environment. the bit a at Yes, because software, lot there that then there

as So, back elements the Office Office accounts the of XXX well agent there was the XXX that and went email in-house. between environment, forth as that and was

that's And their get in views That really so these entire the environment? or of I are what have managed passive running most one and and end-of-life trojanized where or my give and or of particular inventory coming and agents where assets that and what also I'm what conversation software and issues that into I of our is I that am to I more trojanized is not, conversation combination end-of-life asset asset the when them really the knowing what that have within more software inventory do up first Where leading what a scanner, ability thing to was, do version, find do on with one before environment. I to about is about say, includes that I that everybody need environment. unmanaged, this that the of that, running, into do speaking the in assets accurate software, stumbled to us for I whether have

can that there find first your XDR threat into I configuration release is to and the this et if to that's my just properly That's may right? detection you XXX, that to I'm leveraged Zoom, be where that that be is able devices in by et lateral remediation your to to an tie you environment and cetera. solutions I to is our make for cetera. Salesforce, impact, taking that come be are we Then not EDR which play. all mitigating make going actions sure sure is need other response, be, to going the well, and did, in that need point configured was is which our And I'm gives to that find, movement, need was SaaS that approach combination identifying Office of I make earlier of I trying the your risk the So where to

to that global definitely as other it that what be to of and add now And definitely able solution inventory. is that as holistic we a customers hybrid picture, that into platform go deploy bundled this see you point and also So get and is for asset that makes to from for hear the that more of customers. is move the they're their another environment, starting our all much the finding they have platform helpful element sure part will inventory the that's fact --

to market, Thank it. appointments, a maybe you then of Got up a announced you. leadership number And just go on right. follow

for looking sort also of think be head of And I'm more wondering capacity? of changes sales think before. who facto currently. that a was de do You're of in there adding I CRO you Or do mean, the a the it to Philippe? you organization that function maybe was structure? is has sales this

de facto the was Philippe, mean, I sales. head Yes, for

-- field very However, with we think, working I on right. And as with a mentioned, Philippe I the it's combination well. as was involved

that we go more very strong -- are our We're model and customers -- not our go of push and products. model there's believers So more and hunters changing the in to farmers. new where the

to tracked is for leadership help to on ways upsells, for bringing which CRO, we cetera. approach additional going customers However, can where that find bringing be targeting customers, et can a focus us

So the have the or -- CRO example ways the looking connect executives, that right. coming obviously, new will new is way find is in with changes in to of leadership be C-level to some there there an while that more as

we we that of So vulnerability just evangelize the power taken. that can overall management approach have than the rather platform the

will have that the we newer fundamentally been and obviously So think on, ideas model. looking will power that but we there what we looking do implement, working be base and that to be I in at believe of

much. very you Thank

you. Sachs. of Thank [Operator next comes Goldman Our from Instructions] question Essex Brian

open is line Your

of know for volatility. sales about a little headcount, as Philippe that's they'll him. bit speedy seeing? extend reps question. where reps like different you well, marketing Sumedh the well and is terms a I productive can seeing Good onboard afternoon you in you on hit bringing little and past, the bit economic and and could you've Mi, as about ramp all Maybe for hope that Maybe, gives more to the and Joo what talk in a I what thoughts period maybe and some chime in be investing would in and new marketing well thank guess efficiently recovery now they with about a they you're my might taking you that for you're in talked And I that and confidence expectations. could of sales hesitation organization

will and that adoption see are I think where but that right Mi newer big of more a the and obviously that of toward more part of -- to they now and is customers are answer interest our is VMDR and Joo and I services this fruition speed part, our the seeing -- cases have them much coming already. adopting are in and have where

obviously to with show that Management, things at feel our File we Security, some them. look are -- on very drives Patch really if So you upsell thought Container process to -- good of Integrity these starting tracking a customers Monitoring, our and that

leadership And of a think where or are how ready our additional headcount -- is that we bringing part at so we as and how -- well. also I look is when customers

level helpful, the as level marketing contraction What other call Joo in Mi words, that. that of if there you're able we maybe going being year thank of growth invest a -- so better looking think deliver should to you Got we'll we expansion think may of framework Joo and XXXX? -- recovery, and is margin balance the after with for for R&D. how be in Mi you forward? it, to expansion see at growth and respect margin this about we about, is might see year in is sales In a to and it margin

time, new something margin not [case] the where XXXX for -- XXXX. that our show it's is, if it before, a it's like example, Back at were because it about think from you done that we right. the EBITDA [Ph] in at history, we almost And our take we in XX%. to look way current company investor the that XX% point was us, we've billings our Yes, in

look a the XX%. at take EBITDA at now, you we're If margin

could and should And spend, more. we so expansion with in could driven And profitability. sales marketing relative to We invest really better you point definitely do by was that, the in that margin job a back argue definitely growth balancing that XXXX. under

then as return and growth we EBITDA up at and and understand how And So now of don't given will our XX%. percentage in XXXX, and That With our and but revenue. marketing our more the XX%. is infrastructure that margin that sales high. that's we invest to that down will model and grown, was go that to revenue we sales think we we translate scalable into we've above said, be why mostly have think a XX%, before eventually marketing business that billing's in

very you Got helpful. it, that's Thank much.

at further over Sumedh this questions turn showing Thank the you. for time. like I'm to call back no closing Thakar any remarks. I'd to

are that Vulnerability call different multiple to EDR is be platform for and EDR, aspect the of DR safe. that now DR with just XDR SaaS with are questions, only for for earnings SaaS feel work of with just fortunate platform in environment that capabilities we Multi-Vector there VMDR whether where one a lot providing everyone it's coming really on and hard an focusing you that build thank we security, Management. Today solutions really still our the We to including cloud solution. point a hope all our attending and very Well, you are well-positioned or

We new to expanding and invest in developing aggressively of the capabilities platform solutions. continue our

revenues maintaining very much. you our and and leading shareholders. I creating value profitability, all our for growing on safe focused our also remain are hope we Thank industry healthy. Additionally, you of long-term while

conclude and you. for participating. you Thank this all Ladies Thank does conference. gentlemen, today's

disconnect. You may great a Have now day.