Q2 Holdings, Inc. (QTWO)

Price$62.17Cached quoteAs of 2026-09-04 16:23 UTC

AI: Fair-priced

Price checkThe valuation is demanding, but stronger cash generation and recurring growth keep it near fair value.

At the observed market value of about $4.0 billion, Q2 trades around 44 times trailing net income of roughly $92 million and about 4.5 times the midpoint of 2026 revenue guidance. Using June net cash of about $59 million, enterprise value is roughly 16 times the midpoint of adjusted EBITDA guidance. Those are not bargain multiples, yet first-half free cash flow was $95.2 million and revenue guidance still implies about 11% growth. The current valuation therefore requires continued double-digit growth and further margin expansion, making fair value more defensible than a clear bargain. Investing.com Español+1

Big pictureQ2 has moved from years of losses to profitable growth, with cash generation improving faster than sales.

Revenue rose from $402.8 million in 2020 to $794.8 million in 2025, while net income improved from a $137.6 million loss to a $52.0 million profit and operating cash flow from negative $2.9 million to positive $201.5 million. In the second quarter of 2026, revenue grew 13% year over year, gross margin reached 59.2%, and net income reached $29.9 million. This shows real operating leverage, but the valuation assumes those gains continue rather than merely reflecting a one-time recovery from earlier losses. Pasted text

Business strengthLong contracts and growing recurring revenue create durability, while debt reduction has strengthened downside protection.

Subscription revenue was $182.8 million of $219.8 million in the second quarter, about 83% of sales, and initial digital-banking agreements average more than five years. Subscription annual recurring revenue reached $825.5 million, up 15%, while contracted backlog was about $2.8 billion, up 17%. Q2 also repaid roughly $304 million of convertible notes and ended June with about $59 million of net cash. The main cyclical exposure is usage-based activity and slower bank purchasing or implementations during financial-sector stress. SEC+1

What could change the storyFaster margin gains or disciplined buybacks could justify more upside; slowing bank demand would break the case.

Q2 repurchased 2.27 million shares for $120.1 million in the first half, including second-quarter purchases at an average well below the later market level, and then authorized another $350 million. That helps offset dilution, but shares outstanding still rose about 13% from 2020 through 2025, while stock compensation was $86.9 million in 2025 and $40.8 million in the first half of 2026. The bull case is sustained recurring growth and margin expansion; the bear case is flatter bookings, slower implementations, or buybacks that merely neutralize compensation. SEC+2SEC+2

AI: News

Raised outlook after Q2Q2 beat quarterly expectations, expanded margins, and raised full-year guidance, strengthening confidence in its profit transition.

On July 29, Q2 reported second-quarter revenue of $219.8 million, up 13% year over year, and adjusted EBITDA of $62.8 million, up 37%. Management raised full-year revenue guidance to $881 million-$886 million and adjusted EBITDA guidance to $244 million-$248 million. The shares fell about 2% in the next regular session and about 2% after hours initially, so the immediate reaction was mixed despite stronger fundamentals; price timing alone cannot prove the report caused the move. Q2 Holdings+2Investing.com+2

Bigger share repurchaseThe board added a large buyback authorization after debt repayment, signaling confidence and supporting per-share value.

Also on July 29, the board authorized up to $350 million of additional repurchases, taking available capacity to roughly $375 million at announcement. Q2 had already spent $120.1 million on 2.27 million shares in the first half and repaid about $304 million of convertible notes. The program can reduce share count and offset stock compensation, but it is discretionary and competes with cash reserves and reinvestment. Its value depends heavily on whether future purchases occur below the company's long-run intrinsic value. SEC+1

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Total cash / debt

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Financial statements

	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015	2014	2013	2012
Revenue	$794.8M	$696.5M	$624.6M	$565.7M	$498.7M	$402.8M	$315.5M	$241.1M	$194.0M	$150.2M	$108.9M	$79.1M	$56.9M	$41.1M
Gross profit	$429.7M	$354.5M	$302.7M	$256.3M	$225.0M	$174.6M	$153.0M	$119.2M	$94.5M	$72.8M	$49.7M	$33.1M	$20.6M	$15.9M
Gross margin	54.06%	50.90%	48.45%	45.32%	45.12%	43.35%	48.50%	49.46%	48.71%	48.46%	45.69%	41.80%	36.24%	38.76%
Research & development	$154.3M	$143.2M	$137.3M	$130.1M	$117.0M	$97.4M	$76.3M	$51.3M	$40.3M	$32.5M	$21.5M	$12.1M	$9.0M	$5.3M
Operating expenses	$389.8M	$396.7M	$388.7M	$361.1M	$303.0M	$274.4M	$219.7M	$151.1M	$121.4M	$108.5M	$74.6M	$52.1M	$37.7M	$23.1M
Operating income	$39.9M	−$42.3M	−$86.1M	−$104.8M	−$78.0M	−$99.8M	−$66.7M	−$31.9M	−$26.9M	−$35.7M	−$24.8M	−$19.1M	−$17.1M	−$7.1M
Operating margin	5.02%	−6.07%	−13.78%	−18.52%	−15.64%	−24.79%	−21.16%	−13.21%	−13.87%	−23.78%	−22.82%	−24.10%	−30.11%	−17.34%
EBITDA	$93.3M	$26.5M	−$14.3M	−$43.1M	−$23.2M	−$48.0M	−$38.3M	−$15.0M	−$12.0M	−$23.5M	−$18.0M	−$15.0M	−$14.2M	−$5.4M
EBITDA margin	11.74%	3.81%	−2.30%	−7.62%	−4.64%	−11.92%	−12.14%	−6.24%	−6.17%	−15.66%	−16.53%	−18.94%	−24.88%	−13.21%
Net income	$52.0M	−$38.5M	−$65.4M	−$109.0M	−$112.7M	−$137.6M	−$70.9M	−$35.4M	−$26.2M	−$36.4M	−$25.1M	−$19.6M	−$17.9M	−$8.8M
Net profit margin	6.54%	−5.53%	−10.47%	−19.27%	−22.61%	−34.17%	−22.47%	−14.68%	−13.49%	−24.20%	−23.02%	−24.81%	−31.43%	−21.36%
Basic EPSper basic share	$0.84	-$0.64	-$1.12	-$1.90	-$2.00	-$2.65	-$1.53	-$0.83	-$0.63	-$0.92	-$0.67	-$0.67	-$1.51	-$0.77
Diluted EPSper diluted share	$0.80	-$0.64	-$1.12	-$1.90	-$2.00	-$2.65	-$1.53	-$0.83	-$0.63	-$0.92	-$0.67	-$0.67	-$1.51	-$0.77

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

16.73%of listed shares

BlackRock, Inc.10.43M shares · Jun 30, 2026

View holders

Top 20 reported holders of QTWO
Holder	% owned
BlackRock, Inc.	16.73%10.43M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	7.97%4.97M shares
VANGUARD CAPITAL MANAGEMENT LLC	4.36%2.72M shares
STATE STREET CORP	4.22%2.63M shares
TREMBLANT CAPITAL GROUP	2.95%1.84M shares
MILLENNIUM MANAGEMENT LLC	2.90%1.81M shares
NOMURA ASSET MANAGEMENT INTERNATIONAL INC.	2.62%1.63M shares
GEODE CAPITAL MANAGEMENT, LLC	2.54%1.59M shares
Capital Research Global Investors	2.37%1.48M shares
VICTORY CAPITAL MANAGEMENT INC	2.30%1.43M shares
Conestoga Capital Advisors, LLC	2.23%1.39M shares
GOLDMAN SACHS GROUP INC	2.07%1.29M shares
TWO SIGMA INVESTMENTS, LP	1.93%1.2M shares
AMERICAN CENTURY COMPANIES INC	1.81%1.13M shares
ALGEBRIS (UK) LTD	1.72%1.07M shares
FEDERATED HERMES, INC.	1.68%1.05M shares
DIMENSIONAL FUND ADVISORS LP	1.62%1.01M shares
MANUFACTURERS LIFE INSURANCE COMPANY, THE	1.60%997.53K shares
ARROWSTREET CAPITAL, LIMITED PARTNERSHIP	1.40%875.85K shares
Tensile Capital Management LP	1.39%868.77K shares

Percentages use 62.36M shares of this listed class outstanding on Jun 30, 2026.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys0$0.00 disclosed value

Sells (SEC code S)112$146.04M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jun 10, 2026Form 4	Coleman Kirk LChief Business Officer	SellCommon Stock	3.6K	$43.48	$156.7K	329.7K
Jun 1, 2026Form 4	Coleman Kirk LChief Business Officer	SellCommon Stock	20.9K	$49.50	$1.03M	298.4K
May 14, 2026Form 4	Kerr Michael SGeneral Counsel	SellCommon Stock	397	$44.98	$17.9K	81.4K
Mar 11, 2026Form 4 · 10b5-1	Kerr Michael SGeneral Counsel	SellCommon Stock	2.1K	$50.33	$104.2K	45.2K
Mar 11, 2026Form 4 · 10b5-1	Rutledge Kimberly AnneChief People Officer	SellCommon Stock	3.2K	$50.37	$160.5K	80.6K

Review ownership filings at SEC.gov ↗

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Q2 Holdings, Inc. (QTWO)

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