Qualys Should Focus On A PaaS Strategy

Earlier this month, cloud services security provider Qualys (Nasdaq: QLYS) announced its third-quarter results that continued to impress the market. Qualys continues to invest in product development to gain bigger traction in the market.

Qualys’s Financials

For the third quarter of the year, Qualys’s revenues grew 13% over the year to $93.1 million, surpassing the market’s estimates by 1.2%. Net income improved to $22.7 million from $19.2 million a year ago. On an adjusted basis, EPS was $0.77 compared, ahead of the market’s forecast of $0.66 per share.

For the fourth quarter, Qualys forecast revenues of $94.2-$94.8 million with adjusted earnings of $0.39-$0.41 a share. The market was looking for revenues of $93.17 million with an EPS of $0.59 for the quarter. Qualys expects to end the year with revenues of $362.4-$363 million compared with an earlier estimate of $359-$360.5 million. It forecast the year’s EPS at $2.85-$2.87 which was marginally higher than its earlier forecast of $2.60-$2.65. The market was looking for revenues of $360.17 million with an EPS of $2.63 for the year.

Qualys managed to post better than expected results for the quarter. Revenues, margins, and the outlook was better than the market’s estimates. The current pandemic has resulted in slower hiring this year, and management expects FY21 to be an investment year as it increases its sales capacity to build a pipeline for newer solutions. Coupled with newer products, and a bigger sales team, Qualys should see a stronger performance in the coming quarters.

Qualys’s Product Expansion

During the quarter, Qualys expanded the integration of its Vulnerability Management with Microsoft Azure Arc. The integration will allow customers to perform vulnerability scanning on servers that are outside of the Azure platform including both on-premise and multi-cloud servers. The capability will be available for all customers of Azure Defender at no extra cost.

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