Qualys (QLYS) Up 2.1% Since Last Earnings Report: Can It Continue?

It has been about a month since the last earnings report for Qualys (QLYS). Shares have added about 2.1% in that time frame, outperforming the S&P 500.But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Qualys due for a pullback? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Qualys, Inc. before we dive into how investors and analysts have reacted as of late.Qualys Q3 Earnings Surpass Expectations, Revenues Rise Y/YQualys came out with third-quarter 2025 earnings of $1.86 per share, beating the Zacks Consensus Estimate of $1.56 by 19.2%. The company reported earnings of $1.56 per share in the year-ago quarter.Qualys posted revenues of $169.88 million for the third quarter 2025, surpassing the Zacks Consensus Estimate by 2.49%. This compares to year-ago revenues of $153.87 million. The top line grew 10% year over year.Qualys’ Q3 in DetailDuring the third quarter, sales from channel partners surged 17%, outpacing the 5% sales growth recorded in direct selling. Channel partners contributed 50% to total revenues in the quarter, up from 47% a year ago, while direct selling accounted for the remaining 50%.Geographically, U.S. sales grew 7% year over year, contributing approximately 56% to total revenues, while international sales rose 15% and accounted for 44%.Qualys’ net dollar expansion rate remained steady at 104%, reflecting improved gross retention but continued upsell challenges.QLYS’ non-GAAP gross profit increased 13% year over year to $144.9 million, with the non-GAAP gross margin expanding to 85% compared with 83% in the year-ago quarter. Non-GAAP operating income rose 21% to $80 million, representing a margin of 47%, up from 43% a year earlier. The margin improvement highlights Qualys’ strong operating leverage despite higher investments in sales and marketing, which grew 9%.Adjusted EBITDA grew 19% year over year to $82.6 million, with the adjusted EBITDA margin improving to 49% from 45% in the prior-year quarter.Qualys’ Balance Sheet & Cash FlowQualys ended the quarter with $663.6 million in cash, cash equivalents, and marketable securities compared with $621 million in the previous quarter. The company generated operating cash flow of $90.4 million, up 48% year over year, and free cash flow of $89.5 million, representing a 53% margin versus 37% in the prior year.Qualys repurchased 366,000 shares worth $49.4 million during the third quarter and has repurchased a cumulative 10.4 million shares valued at $1.2 billion since the program’s inception. As of Sept. 30, 2025, $205.2 million remained under the current share repurchase authorization.Qualys Updates GuidanceBuoyed by stronger-than-expected third-quarter performance, Qualys raised guidance for full-year 2025. It now expects revenues between $665.8 million and $667.8 million, up from the earlier range of $656-$662 million. The updated guidance range implies a year-over-year improvement of 10%.Qualys now forecasts non-GAAP earnings for 2025 to be in the range of $6.93 to $7.00 per share, up from the previous range of $6.20-$6.50.Qualys also initiated guidance for the fourth quarter. The company expects revenues between $172.0 million and $174.0 million for the fourth quarter, indicating year-over-year growth of 8-9%. It projects non-GAAP earnings in the range of $1.73 to $1.80.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a upward trend in fresh estimates.The consensus estimate has shifted 25.12% due to these changes.VGM ScoresAt this time, Qualys has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock has a grade of F on the value side, putting it in the bottom 20% quintile for value investors.Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Qualys has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.Zacks' Research Chief Picks Stock Most Likely to "At Least Double"Our experts have revealed their Top 5 recommendations with money-doubling potential – and Director of Research Sheraz Mian believes one is superior to the others. Of course, all our picks aren’t winners but this one could far surpass earlier recommendations like Hims & Hers Health, which shot up +209%.See Our Top Stock to Double (Plus 4 Runners Up) >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Qualys, Inc. (QLYS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks