Q2 Holdings, Inc. (NYSE:QTWO), a leading provider of digital
transformation solutions for banking and lending, today announced
results for its fourth quarter and full year ending December 31,
2021.
GAAP Results for the Fourth Quarter and Full-Year
2021
- Revenue for the fourth quarter of $131.9 million, up 21 percent
year-over-year and up 4 percent from the third quarter of 2021.
Full-year 2021 revenue of $498.7 million, up 24 percent
year-over-year.
- GAAP gross margin for the fourth quarter of 45.1 percent, up
from 40.8 percent for the prior-year quarter and 45.0 percent for
the third quarter of 2021. GAAP gross margin for full-year 2021 of
45.1 percent, up from 43.4 percent for the full-year 2020.
- GAAP net loss for the fourth quarter of $25.4 million, compared
to GAAP net losses of $37.8 million for the prior-year quarter and
$31.6 million for the third quarter of 2021. GAAP net loss for
full-year 2021 of $112.7 million, compared to $137.6 million for
full-year 2020.
Non-GAAP Results for the Fourth Quarter and Full-Year
2021
- Non-GAAP revenue for the fourth quarter of $132.3 million, up
21 percent year-over-year and up 4 percent from the third quarter
of 2021. Full-year 2021 non-GAAP revenue of $500.8 million, up 23
percent year-over-year.
- Non-GAAP gross margin for the fourth quarter of 51.5 percent,
up from 48.3 percent for the prior-year quarter and down from 51.9
percent for the third quarter of 2021. Non-GAAP gross margin for
full-year 2021 of 51.9 percent, consistent with 51.9 percent for
full-year 2020.
- Adjusted EBITDA for the fourth quarter of $10.8 million, up
from $6.1 million for the prior-year quarter and $7.3 million for
the third quarter of 2021. Full-year 2021 adjusted EBITDA of $37.9
million up from $22.2 million for the full-year 2020.
For a reconciliation of our GAAP to non-GAAP results, please see
the tables below.
“We exited 2021 with strong results, delivering both the second
largest bookings quarter and best half-year of bookings performance
in company history,” said Q2 CEO Matt Flake. “I was particularly
pleased with the broad sales strength, highlighted by numerous Tier
1 and Enterprise deals across both digital banking and lending. Q2
Innovation Studio and Q2 Banking-as-a-Service—now called
Helix—continued to gain traction, adding new partners and extending
key clients. While we’re continuing to monitor the macro-economic
backdrop for our customers in the near term, we are increasingly
seeing financial institutions, fintechs, and innovative brands
accelerating their investments in financial services technology.
With our broad solution portfolio and positive momentum exiting
2021, I believe we’re uniquely poised to capitalize on that
opportunity in 2022 and beyond.”
Fourth Quarter Highlights
Sales Success Across the
Business
- Signed three Tier 1 digital banking contracts, including a:
- Tier 1, Top 100 U.S. bank to utilize our retail & small
business solutions;
- Tier 1 bank to utilize our full digital banking suite including
retail, small business and corporate digital banking solutions;
and
- Tier 1 credit union to utilize our corporate digital banking
solutions.
- Signed five enterprise and two Tier 1 digital lending contracts
to utilize our loan pricing solutions, including a(n):
- Enterprise, Top 5 Canadian bank which signed separate deals in
both Canada and the U.S.;
- Enterprise, Top 5 U.S. bank;
- Enterprise, Top 10 U.S. bank to expand the lines of business
which utilize our loan pricing solutions;
- Enterprise, Top 25 U.S. bank;
- Tier 1, Top 100 U.S. bank to adopt the full loan pricing
solution suite; and
- Tier 1, financial institution in the U.S.
- Signed two Tier 1 digital lending contracts to utilize our
treasury onboarding solution.
- Signed multi-year renewals with three of our top five Helix
customers.
- Signed one enterprise and four Tier 1 digital banking contracts
to utilize our ClickSWITCH solutions.
Strong Year-End Results due to Sales and
Operational Execution
- Annualized Recurring Revenue increased to $574.2 million, up
24% year-over-year from $464.2 million at the end of 2020.
- Our Remaining Performance Obligation total, or Backlog,
increased by $121.7 million sequentially resulting in total
committed Backlog of over $1.4 billion, representing 10%
year-over-year growth and 9% sequential growth.
- Our trailing twelve-month net revenue retention rate was 119%,
down slightly from 122% in the prior year.
- 122% retention rate in 2020 included contribution from the
acquisition of PrecisionLender in the fourth quarter of 2019.
- Our annual revenue churn was 5.4%, down from 5.9% in the prior
year.
- Exited the fourth quarter with approximately 19.2 million
registered users on the Q2 digital banking platform, representing
8% year-over-year growth and consistent with the previous
quarter.
“We were pleased with our financial performance for the quarter
with revenue results near the high-end of our guidance and EBITDA
well exceeding our guidance,” said David Mehok, Q2 CFO. “Cash flow
from operations for the fourth quarter was $39.3 million, our best
quarter on record, as we finished with cash, cash equivalents, and
investments of $427.7 million. We believe our continued operational
efficiency and continuing sales success will further position us
well to capitalize on our long-term market opportunity.”
Financial outlook
As of February 15, 2022, Q2 Holdings is providing guidance for
its first quarter of 2022 and full-year 2022, which represents Q2
Holdings’ current estimates on Q2 Holdings’ operations and
financial results and the anticipated impacts of the COVID-19
pandemic. The financial information below represents
forward-looking, non-GAAP financial information, including
estimates of non-GAAP revenue and adjusted EBITDA. GAAP net loss is
the most comparable GAAP measure to adjusted EBITDA. Adjusted
EBITDA differs from GAAP net loss in that it excludes items such as
depreciation and amortization, stock-based compensation,
acquisition-related costs, interest and other (income) expense,
income taxes, unoccupied lease charges, partnership termination
charges, loss on extinguishment of debt and the impact to deferred
revenue from purchase accounting. Q2 Holdings is unable to predict
with reasonable certainty the ultimate outcome of these exclusions
without unreasonable effort. Therefore, Q2 Holdings has not
provided guidance for GAAP net loss or a reconciliation of the
foregoing forward-looking adjusted EBITDA guidance to GAAP net
loss. However, it is important to note that these excluded items
could be material to our results computed in accordance with GAAP
in future periods.
Q2 Holdings is providing guidance for its first quarter of 2022
as follows:
- Total non-GAAP revenue of $131.5 million to $133.0 million,
which would represent year-over-year growth of 12 to 14
percent.
- Adjusted EBITDA of $7.7 million to $8.7 million, representing 6
to 7 percent of non-GAAP revenue for the quarter.
Q2 Holdings is providing guidance for the full-year 2022 as
follows:
- Total non-GAAP revenue of $576.0 million to $581.0 million,
which would represent year-over-year growth of 15 percent to 16
percent.
- Adjusted EBITDA of $40.9 million to $43.9 million, representing
7 to 8 percent of non-GAAP revenue for the year.
Conference Call Details
Date:
Wednesday, February 16
Time:
8:30 a.m. EST
Hosts:
Matt Flake, CEO / David Mehok, CFO /
Jonathan Price, EVP Emerging Businesses, Corporate & Business
Development
Webcast Registration:
https://events.q4inc.com/attendee/853514797
Conference Call Registration:
https://conferencingportals.com/event/FXwYzhXH
All participants must register using either above link (webcast
or conference call). A webcast of the conference call, financial
results and associated materials will be accessible from the
investor relations section of the Q2 website at
http://investors.Q2.com/. In addition, a live conference call
dial-in will be available upon registration. Participants should
dial in at least 10 minutes before the start of the conference. An
archived replay of the webcast will be available on this website
for a limited time after the call. Q2 has used, and intends to
continue to use, its investor relations website as a means of
disclosing material non-public information and for complying with
its disclosure obligations under Regulation FD.
About Q2 Holdings, Inc.
Q2 is a financial experience company dedicated to providing
digital banking and lending solutions to banks, credit unions,
alternative finance, and fintech companies in the U.S. and
internationally. With comprehensive end-to-end solution sets, Q2
enables its partners to provide cohesive, secure, data-driven
experiences to every account holder – from consumer to small
business and corporate. Headquartered in Austin, Texas, Q2 has
offices throughout the world and is publicly traded on the NYSE
under the stock symbol QTWO. To learn more, please visit
Q2.com.
Use of Non-GAAP Measures and Key Operating Measures
Q2 uses the following non-GAAP financial measures: non-GAAP
revenue; adjusted EBITDA; non-GAAP gross margin; non-GAAP gross
profit; non-GAAP sales and marketing expense; non-GAAP research and
development expense; non-GAAP general and administrative expense;
non-GAAP operating expense; non-GAAP operating income (loss);
non-GAAP net income; non-GAAP net income per share; and non-GAAP
diluted weighted-average number of common shares outstanding.
Management believes that these non-GAAP financial measures are
useful measures of operating performance because they exclude items
that Q2 does not consider indicative of its core performance.
In the case of non-GAAP revenue, Q2 adjusts revenue to exclude
the impact to deferred revenue from purchase accounting
adjustments. In the case of adjusted EBITDA, Q2 adjusts net loss
for such items as interest and other (income) expense, taxes,
depreciation and amortization, stock-based compensation,
acquisition-related costs, unoccupied lease charges, partnership
termination charges and the impact to deferred revenue from
purchase accounting. In the case of non-GAAP gross margin and
non-GAAP gross profit, Q2 adjusts gross profit and gross margin for
stock-based compensation amortization of acquired technology,
acquisition-related costs, and the impact to deferred revenue from
purchase accounting. In the case of non-GAAP sales and marketing
expense, non-GAAP research and development expense, and non-GAAP
general and administrative expense, Q2 adjusts the corresponding
GAAP expense to exclude stock-based compensation. Non-GAAP
Operating Expense is calculated by taking the sum of non-GAAP sales
and marketing expenses, non-GAAP research and development expense,
and non-GAAP general and administrative expense. In the case of
non-GAAP operating income (loss), non-GAAP net income (loss), and
non-GAAP net income (loss) per share, Q2 adjusts operating loss and
net loss, respectively, for stock-based compensation,
acquisition-related costs, amortization of acquired technology,
amortization of acquired intangibles, unoccupied lease charges,
partnership termination charges, loss on extinguishment of debt and
the impact to deferred revenue from purchase accounting, and with
respect to non-GAAP net income, amortization of debt discount and
issuance costs and loss on extinguishment of debt. In the case of
non-GAAP diluted weighted-average number of common shares
outstanding, Q2 adjusts diluted weighted-average number of common
shares outstanding by the weighted-average effect of potentially
dilutive shares which include (i) employee equity incentive plans,
excluding the impact of unrecognized stock-based compensation
expense and (ii) convertible senior notes outstanding and related
warrants including the anti-dilutive impact of note hedge and
capped call agreements on convertible senior notes outstanding.
There are limitations associated with the use of these non-GAAP
financial measures. These non-GAAP financial measures are not
prepared in accordance with GAAP, do not reflect a comprehensive
system of accounting and may not be completely comparable to
similarly titled measures of other companies due to potential
differences in the exact method of calculation between companies.
Certain items that are excluded from these non-GAAP financial
measures can have a material impact on operating and net income
(loss). As a result, these non-GAAP financial measures have
limitations and should be considered in addition to, not as a
substitute for or superior to, the closest GAAP measures, or other
financial measures prepared in accordance with GAAP. A
reconciliation to the closest GAAP measures of these non-GAAP
measures is contained in tabular form on the attached unaudited
condensed consolidated financial statements.
Q2’s management uses these non-GAAP measures as measures of
operating performance; to prepare Q2’s annual operating budget; to
allocate resources to enhance the financial performance of Q2’s
business; to evaluate the effectiveness of Q2’s business
strategies; to provide consistency and comparability with past
financial performance; to facilitate a comparison of Q2’s results
with those of other companies, many of which use similar non-GAAP
financial measures to supplement their GAAP results; and in
communication with our board of directors concerning Q2’s financial
performance.
We also monitor the following key operating measures to evaluate
growth trends, plan investments and measure the effectiveness of
our sales and marketing efforts:
Backlog
Consists of contracted revenue minimums that have not yet been
recognized, including amounts that will be invoiced and recognized
as revenue in future periods.
Installed Customers
We define Installed Customers as the number of customers on live
implementations (or installations) of our digital banking
platforms.
Registered Users
We define a Registered User as an individual related to an
account holder of an Installed Customer on our consumer digital
banking platform who has registered to use one or more of our
solutions and has current access to use those solutions as of the
last day of the reporting period presented.
Net Revenue Retention Rate
We believe that our ability to retain our customers and expand
their use of our products and services over time is an indicator of
the stability of our revenue base and the long-term value of our
customer relationships. We assess our performance in this area
using a metric we refer to as our revenue retention rate. We
calculate our revenue retention rate as the total revenues in a
calendar year, excluding any revenues from acquired customers
during such year, from customers who were implemented on any of our
solutions as of December 31 of the prior year, expressed as a
percentage of the total revenues during the prior year from the
same group of customers.
Annualized Recurring Revenue
We believe Annualized Recurring Revenue, or ARR, provides
important information about our future revenue potential, our
ability to acquire new clients, and our ability to maintain and
expand our relationship with existing clients. We calculate ARR as
the annualized value of all recurring revenue recognized in the
last month of the reporting period, with the exception of variable
revenue in excess of contracted amounts for which we instead take
the average monthly run rate of the trailing three months within
that reporting period. Our ARR also includes the contracted
minimums associated with all contracts in place at the end of the
quarter that have not yet commenced, and revenue generated from
Premier Services. Premier Services revenue is generated from select
established customer relationships where we have engaged with the
customer for more tailored, premium professional services resulting
in a deeper and ongoing level of engagement with them, which we
deem to be recurring in nature.
Forward-looking Statements
This press release contains forward-looking statements,
including statements about: our momentum with our Q2 Innovation
Studio and Helix solutions, and Q2’s ability to add new partners
and extend key clients; the impacts of the macro-economic backdrop
for Q2’s customers; accelerated investments by financial
institutions, fintechs, and innovative brands in financial services
technology; Q2’s momentum exiting 2021; the benefits of Q2’s broad
solution portfolio, operational efficiency and improving sales
performance; Q2’s position to capitalize on its long-term market
opportunity; and, Q2’s quarterly and annual financial guidance. The
forward-looking statements contained in this press release are
based upon Q2’s historical performance and its current plans,
estimates, and expectations and are not a representation that such
plans, estimates or expectations will be achieved. Factors that
could cause actual results to differ materially from those
described herein include the adverse impacts of the COVID-19
pandemic on Q2’s business operations and on global economic and
financial markets, including on Q2’s customers, partners and
suppliers and employees and business, as well as risks related to:
(a) the risk of increased competition in its existing markets and
as it enters new sections of the market with Tier 1 customers, new
markets with Alt-FIs and fintechs and new products and services;
(b) the risk that COVID-19, government actions or other factors
continue to negatively impact or disrupt the markets for Q2’s
solutions and that the markets for Q2’s solutions do not return to
normal or grow as anticipated, in particular with respect to
Enterprise and Tier 1 customers and Alt-FI and fintech customers;
(c) the risk that Q2’s increased focus on selling to larger
Enterprise or Tier 1 customers may result in greater uncertainty
and variability in Q2’s business and sales results; (d) the risk
that changes in Q2’s market, business or sales organization
negatively impact its ability to sell its products and services;
(e) the challenges and costs associated with selling, implementing
and supporting Q2’s solutions, particularly for larger customers
with more complex requirements and longer implementation processes,
including risks related to the timing and predictability of sales
of Q2’s solutions and the impact that the timing of bookings may
have on Q2’s revenue and financial performance in a period; (f) the
risk that errors, interruptions or delays in Q2’s products or
services or Web hosting negatively impacts Q2’s business and sales;
(g) risks associated with cyberattacks, data and privacy breaches
and breaches of security measures within Q2’s products, systems and
infrastructure or the products, systems and infrastructure of third
parties upon which Q2 relies and the resultant costs and
liabilities and harm to Q2’s business and reputation and its
ability to sell its products and services; (h) the impact that a
slowdown in the economy, financial markets and credit markets may
have on Q2’s customers and Q2’s business sales cycles, prospects
and customers’ spending decisions and timing of implementation
decisions, particularly in regions where a significant number of
Q2’s customers are concentrated; (i) the difficulties and risks
associated with developing and selling complex new solutions and
enhancements with the technical and regulatory specifications and
functionality required by customers and governmental authorities;
(j) the risks inherent in technology and implementation
partnerships that could cause harm to Q2’s business; (k) the
difficulties and costs Q2 may encounter with complex
implementations of its solutions and the resulting impact on
reputation and the timing of its revenue from any delayed
implementations; (l) the risk that Q2 will not be able to maintain
historical contract terms such as pricing and duration; (m) the
risks and increased costs associated with managing growth and the
challenges associated with improving operations and hiring,
retaining and motivating employees to support such growth,
particularly in light of the macroeconomic impacts of the COVID-19
pandemic, including increased employee turnover, labor shortages,
wage inflation and extreme competition for talent; (n) the risk
that modifications or negotiations of contractual arrangements will
be necessary during Q2’s implementations of its solutions or the
general risks associated with the complexity of Q2’s customer
arrangements; (o) the risks associated with integrating acquired
companies and successfully selling and maintaining their solutions;
(p) the risks associated with anticipated higher operating expenses
in 2022 and beyond; (q) litigation related to intellectual property
and other matters and any related claims, negotiations and
settlements; (r) the risks associated with further consolidation in
the financial services industry; (s) risks associated with selling
Q2 solutions internationally; and (t) the risk that Q2 debt
repayment obligations may adversely affect its financial condition
and cash flows from operations in the future and that Q2 may not be
able to obtain capital when desired or needed on favorable
terms.
Additional information relating to the uncertainty affecting the
Q2 business is contained in Q2’s filings with the Securities and
Exchange Commission. These documents are available on the SEC
Filings section of the Investor Relations section of Q2’s website
at http://investors.Q2.com/. These forward-looking statements
represent Q2’s expectations as of the date of this press release.
Subsequent events may cause these expectations to change, and Q2
disclaims any obligations to update or alter these forward-looking
statements in the future, whether as a result of new information,
future events or otherwise.
Q2 Holdings, Inc.
Condensed Consolidated Balance
Sheets
(in thousands)
(unaudited)
December 31,
December 31,
2021
2020
Assets Current assets: Cash and cash equivalents
$
322,848
$
407,703
Restricted cash
2,973
3,482
Investments
104,878
131,352
Accounts receivable, net
46,979
36,430
Contract assets, current portion, net
1,845
1,088
Prepaid expenses and other current assets
10,531
8,861
Deferred solution and other costs, current portion
25,076
19,042
Deferred implementation costs, current portion
7,320
8,258
Total current assets
522,450
616,216
Property and equipment, net
66,608
49,558
Right of use assets
52,278
34,709
Deferred solution and other costs, net of current portion
26,930
32,782
Deferred implementation costs, net of current portion
17,039
15,184
Intangible assets, net
162,461
184,859
Goodwill
512,869
462,274
Contract assets, net of current portion and allowance
22,103
18,694
Other long-term assets
2,307
2,426
Total assets
$
1,385,045
$
1,416,702
Liabilities and stockholders' equity Current liabilities:
Accounts payable and accrued liabilities
$
60,665
$
57,047
Deferred revenues, current portion
98,692
81,935
Lease liabilities, current portion
9,001
6,844
Total current liabilities
168,358
145,826
Convertible notes, net of current portion
551,598
557,468
Deferred revenues, net of current portion
29,168
29,203
Lease liabilities, net of current portion
61,374
36,739
Other long-term liabilities
4,251
4,102
Total liabilities
814,749
773,338
Stockholders' equity: Common stock
6
6
Additional paid-in capital
1,064,358
1,024,577
Accumulated other comprehensive loss
(135
)
(32
)
Accumulated deficit
(493,933
)
(381,187
)
Total stockholders' equity
570,296
643,364
Total liabilities and stockholders' equity
$
1,385,045
$
1,416,702
Q2 Holdings, Inc.
Condensed Consolidated
Statements of Comprehensive Loss
(in thousands, except per share
data)
(unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
2021
2020
2021
2020
Revenues (1)
$
131,891
$
108,986
$
498,720
$
402,751
Cost of revenues (2)
72,407
64,476
273,685
228,152
Gross profit
59,484
44,510
225,035
174,599
Operating expenses: Sales and marketing
22,497
17,726
85,564
72,323
Research and development
29,965
25,213
116,952
97,381
General and administrative
20,025
17,061
77,915
70,937
Acquisition related costs
176
500
2,690
478
Amortization of acquired intangibles
4,436
4,441
17,901
17,888
Partnership termination charges
-
-
-
13,244
Unoccupied lease charges (benefit) (3)
(48
)
45
2,008
2,181
Total operating expenses
77,051
64,986
303,030
274,432
Loss from operations
(17,567
)
(20,476
)
(77,995
)
(99,833
)
Total other income (expense), net (4)
(7,080
)
(16,550
)
(33,108
)
(36,371
)
Loss before income taxes
(24,647
)
(37,026
)
(111,103
)
(136,204
)
Provision for income taxes
(734
)
(795
)
(1,643
)
(1,416
)
Net loss
$
(25,381
)
$
(37,821
)
$
(112,746
)
$
(137,620
)
Other comprehensive loss: Unrealized loss on available-for-sale
investments
(210
)
(52
)
(213
)
(118
)
Foreign currency translation adjustment
(19
)
58
110
72
Comprehensive loss
$
(25,610
)
$
(37,815
)
$
(112,849
)
$
(137,666
)
Net loss per common share: Net loss per common share, basic and
diluted
$
(0.45
)
$
(0.69
)
$
(2.00
)
$
(2.65
)
Weighted average common shares outstanding, basic and diluted
56,846
54,632
56,394
52,019
(1)
Includes deferred revenue reduction from purchase accounting of
$0.5 million and $0.7 million for the three months ended December
31, 2021 and 2020, respectively, and $2.1 million and $4.4 million
for the twelve months ended December 31, 2021 and 2020,
respectively.
(2)
Includes amortization of acquired technology of $5.6 million and
$5.2 million for the three months ended December 31, 2021 and 2020,
respectively, and $22.0 million and $21.3 million for the twelve
months ended December 31, 2021 and 2020, respectively.
(3)
Unoccupied lease charges include costs related to the early
vacating of various facilities, partially offset by anticipated
sublease income from these facilities. For the three and twelve
months ended December 31, 2021, the charges related to an updated
assessment and vacating of facilities in Georgia, Texas, North
Carolina and Nebraska, and for the three and twelve months ended
December 31, 2020, the charges related to the vacating of
facilities in California, North Carolina, and Texas.
(4)
Includes a reduction of $1.5 million and $8.9 million related to
the early extinguishment of a portion of our 2023 Notes for the
twelve months ended December 31, 2021 and the three and twelve
months ended December 31, 2020, respectively.
Q2 Holdings,
Inc. Condensed Consolidated Statements of Cash Flows (in
thousands) (unaudited)
Twelve Months Ended December
31,
2021
2020
Cash flows from operating activities: Net loss
$
(112,746
)
$
(137,620
)
Adjustments to reconcile net loss to net cash from operating
activities: Amortization of deferred implementation, solution and
other costs
24,496
22,936
Depreciation and amortization
54,833
51,840
Amortization of debt issuance costs
2,038
1,977
Amortization of debt discount
25,824
21,317
Amortization of premiums on investments
1,117
366
Stock-based compensation expense
55,903
50,682
Deferred income taxes
180
946
Loss on extinguishment of debt
1,513
8,932
Other non-cash charges
2,411
2,626
Changes in operating assets and liabilities
(24,644
)
(26,892
)
Net cash provided by (used in) operating activities
30,925
(2,890
)
Cash flows from investing activities: Net maturities
(purchases) of investments
25,142
(99,496
)
Purchases of property and equipment
(19,754
)
(23,715
)
Business combinations, net of cash acquired
(64,652
)
-
Capitalized software development costs
(5,865
)
(952
)
Net cash used in investing activities
(65,129
)
(124,163
)
Cash flows from financing activities: Proceeds from issuance
of common stock, net of issuance costs
-
311,321
Proceeds from issuance of convertible notes, net of issuance costs
-
132,589
Purchase of capped call transactions
-
(39,830
)
Payments for repurchases of convertible notes
(63,692
)
-
Proceeds from bond hedges related to convertible notes
26,295
171,679
Payments for warrants related to convertible notes
(19,655
)
(137,538
)
Proceeds from exercise of stock options to purchase common stock
5,892
13,317
Payment of contingent consideration
-
(16,862
)
Net cash provided by (used in) financing activities
(51,160
)
434,676
Net increase (decrease) in cash, cash equivalents, and restricted
cash
(85,364
)
307,623
Cash, cash equivalents, and restricted cash, beginning of period
411,185
103,562
Cash, cash equivalents, and restricted cash, end of period
$
325,821
$
411,185
Q2 Holdings, Inc.
Reconciliation of GAAP to
Non-GAAP Measures
(in thousands, except per share
data)
(unaudited)
Three Months Ended December
31,
Twelve Months Ended December
31,
2021
2020
2021
2020
GAAP revenue
$
131,891
$
108,986
$
498,720
$
402,751
Deferred revenue reduction from
purchase accounting
452
684
2,129
4,404
Non-GAAP revenue
$
132,343
$
109,670
$
500,849
$
407,155
GAAP gross profit
$
59,484
$
44,510
$
225,035
$
174,599
Stock-based compensation
2,564
2,466
10,590
9,888
Amortization of acquired
technology
5,604
5,157
21,969
21,341
Acquisition related costs
82
194
409
929
Deferred revenue reduction from
purchase accounting
452
684
2,129
4,404
Non-GAAP gross profit
$
68,186
$
53,011
$
260,132
$
211,161
Non-GAAP gross margin:
Non-GAAP gross profit
$
68,186
$
53,011
$
260,132
$
211,161
Non-GAAP revenue
132,343
109,670
500,849
407,155
Non-GAAP gross margin
51.5
%
48.3
%
51.9
%
51.9
%
GAAP sales and marketing
expense
$
22,497
$
17,726
$
85,564
$
72,323
Stock-based compensation
(2,801
)
(2,417
)
(11,153
)
(8,770
)
Non-GAAP sales and marketing
expense
$
19,696
$
15,309
$
74,411
$
63,553
GAAP research and development
expense
$
29,965
$
25,213
$
116,952
$
97,381
Stock-based compensation
(3,234
)
(3,089
)
(13,273
)
(12,869
)
Non-GAAP research and development
expense
$
26,731
$
22,124
$
103,679
$
84,512
GAAP general and administrative
expense
$
20,025
$
17,061
$
77,915
$
70,937
Stock-based compensation
(4,944
)
(4,348
)
(19,318
)
(17,708
)
Non-GAAP general and
administrative expense
$
15,081
$
12,713
$
58,597
$
53,229
GAAP operating loss
$
(17,567
)
$
(20,476
)
$
(77,995
)
$
(99,833
)
Deferred revenue reduction from
purchase accounting
452
684
2,129
4,404
Partnership termination
charges
-
-
-
13,244
Stock-based compensation
13,543
12,320
54,334
49,235
Acquisition related costs
258
694
3,099
1,408
Amortization of acquired
technology
5,604
5,157
21,969
21,341
Amortization of acquired
intangibles
4,436
4,441
17,901
17,888
Unoccupied lease charges
(benefit)
(48
)
45
2,008
2,181
Non-GAAP operating income
$
6,678
$
2,865
$
23,445
$
9,868
GAAP net loss
$
(25,381
)
$
(37,821
)
$
(112,746
)
$
(137,620
)
Deferred revenue reduction from
purchase accounting
452
684
2,129
4,404
Partnership termination
charges
-
-
-
13,244
Loss on extinguishment of
debt
-
8,932
1,513
8,932
Stock-based compensation
13,543
12,320
54,334
49,235
Acquisition related costs
258
694
3,099
1,408
Amortization of acquired
technology
5,604
5,157
21,969
21,341
Amortization of acquired
intangibles
4,436
4,441
17,901
17,888
Unoccupied lease charges
(benefit)
(48
)
45
2,008
2,181
Amortization of debt discount and
issuance costs
6,914
6,486
27,862
23,294
Non-GAAP net income
$
5,778
$
938
$
18,069
$
4,307
Reconciliation from diluted
weighted-average number of common shares as reported to Non-GAAP
diluted weighted-average number of common shares
Diluted weighted-average number
of common shares, as reported
56,846
54,632
56,394
52,019
Non-GAAP weighted-average effect
of potentially dilutive shares
488
3,197
966
2,403
Non-GAAP diluted weighted-average
number of common shares
57,334
57,829
57,360
54,422
Calculation of non-GAAP income
per share:
Non-GAAP net income
$
5,778
$
938
$
18,069
$
4,307
Non-GAAP diluted weighted-average
number of common shares
57,334
57,829
57,360
54,422
Non-GAAP net income per share
$
0.10
$
0.02
$
0.32
$
0.08
Reconciliation of GAAP net loss
to adjusted EBITDA:
GAAP net loss
$
(25,381
)
$
(37,821
)
$
(112,746
)
$
(137,620
)
Depreciation and amortization
14,253
12,865
54,833
51,840
Stock-based compensation
13,543
12,320
54,334
49,235
Provision for income taxes
734
795
1,643
1,416
Interest and other (income)
expense, net
7,007
7,594
31,063
27,180
Acquisition related costs
258
694
3,099
1,408
Unoccupied lease charges
(benefit)
(48
)
45
2,008
2,181
Loss on extinguishment of
debt
-
8,932
1,513
8,932
Deferred revenue reduction from
purchase accounting
452
684
2,129
4,404
Partnership termination
charges
-
-
-
13,244
Adjusted EBITDA
$
10,818
$
6,108
$
37,876
$
22,220
Q2 Holdings, Inc.
Reconciliation of GAAP to
Non-GAAP Revenue Outlook
(in thousands)
Q1 2022 Outlook
Full Year 2022 Outlook
Low
High
Low
High
GAAP revenue
$
131,258
$
132,758
$
575,320
$
580,320
Deferred revenue reduction from purchase accounting
242
242
680
680
Non-GAAP revenue
$
131,500
$
133,000
$
576,000
$
581,000
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220215005983/en/
MEDIA CONTACT: Jean
Kondo Q2 Holdings,
Inc. M: +1-510-823-4728 jean.kondo@Q2.com
INVESTOR CONTACT: Josh
Yankovich Q2 Holdings,
Inc. O: +1-512-682-4463 josh.yankovich@Q2.com
Grafico Azioni Q2 (NYSE:QTWO)
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Grafico Azioni Q2 (NYSE:QTWO)
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