Q2 Holdings quarterly adjusted EBITDA beats, revenue up 13%; raises FY outlook
Q2 Holdings quarterly adjusted EBITDA beats, revenue up 13%; raises FY outlook
Overview
Digital banking solutions provider's Q2 revenue rose 13% yr/yr
Adjusted EBITDA for Q2 beat analyst expectations
Company authorized additional $350 mln share repurchase, raising total capacity to $375 mln
Outlook
Q2 Holdings sees Q3 2026 revenue between $218.5 mln and $222.5 mln
Company expects Q3 2026 adjusted EBITDA of $58.5 mln to $61.5 mln
Q2 Holdings raises full-year 2026 revenue guidance to $881 mln-$886 mln
Company expects full-year 2026 adjusted EBITDA of $244 mln to $248 mln
Result Drivers
NEW AND EXPANDED BANK CONTRACTS - Co said Q2 results benefited from signing eight Enterprise and Tier 1 contracts, including expansion agreements with top U.S. banks for relationship pricing and digital banking solutions
AI AND FRAUD SOLUTIONS ADOPTION - Co said customers are moving from AI curiosity to adoption, with new AI-powered products and fraud prevention capabilities seeing strong engagement at its CONNECT conference
RECURRING REVENUE AND BACKLOG GROWTH - Co said subscription annualized recurring revenue rose 15% yr/yr and backlog grew 17% yr/yr, supporting continued growth outlook
Company press release: ID:nBw4bdsCba
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue |
| $219.8 mln |
|
Q2 Net Income |
| $29.9 mln |
|
Q2 Adjusted EBITDA | Beat | $62.8 mln | $59.32 mln (11 Analysts) |
Q2 Gross Margin |
| 59.2% |
|
Q2 Adjusted Gross Margin |
| 62.3% |
|
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 12 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the software peer group is "buy"
Wall Street's median 12-month price target for Q2 Holdings Inc is $74.00, about 24.9% above its July 28 closing price of $59.24
The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 16 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)