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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549 
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): July 31, 2024
Q2 HOLDINGS, INC.
(Exact Name of Registrant as Specified in Charter) 

Delaware 001-36350 20-2706637
(State or Other Jurisdiction
of Incorporation)		 (Commission
File Number)		 (I.R.S. Employer
Identification No.)
                
10355 Pecan Park Boulevard
Austin, Texas 78729
(Address of Principal Executive Offices, and Zip Code)

(833) 444-3469
Registrant's Telephone Number, Including Area Code

Not Applicable
(Former Name or Former Address, if Changed Since Last Report) 
Securities registered pursuant to Section 12(b) of the Act:
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): 
☐Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.0001 par valueQTWONew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02. Results of Operations and Financial Condition.
On July 31, 2024, Q2 Holdings, Inc. (the "Company") issued a press release regarding its financial results for the second quarter ended June 30, 2024. A copy of the Company's press release is furnished herewith as Exhibit 99.1.
The information furnished in this Current Report under this Item 2.02 and the exhibit furnished herewith shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No.Description
Press release dated July 31, 2024
104Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Q2 HOLDINGS, INC.
July 31, 2024
/s/ David J. Mehok
David J. Mehok
Chief Financial Officer


Exhibit 99.1
FOR IMMEDIATE RELEASE

Q2 Holdings, Inc. Announces Second Quarter 2024 Financial Results

AUSTIN, Texas (July 31, 2024)—Q2 Holdings, Inc. (NYSE: QTWO), a leading provider of digital transformation solutions for financial services, today announced results for its second quarter ending June 30, 2024.

GAAP Results for the Second Quarter 2024

•Revenue for the second quarter of $172.9 million, up 12 percent year-over-year and up 4 percent from the first quarter of 2024.

•GAAP gross margin for the second quarter of 50.2 percent, up from 47.8 percent in the prior-year quarter and 49.7 percent in the first quarter of 2024.

•GAAP net loss for the second quarter of $13.1 million compared to GAAP net loss of $23.6 million for the prior-year quarter, and net loss of $13.8 million for the first quarter of 2024.

Non-GAAP Results for the Second Quarter 2024

•Non-GAAP revenue for the second quarter of $172.9 million, up 12 percent year-over-year and up 4 percent from the first quarter of 2024.

•Non-GAAP gross margin for the second quarter of 55.7 percent, up from 54.2 percent for the prior-year quarter and 54.9 percent from the first quarter of 2024.

•Adjusted EBITDA for the second quarter of $29.9 million, up from $17.6 million for the prior-year quarter and $25.2 million from the first quarter of 2024.

For a reconciliation of our GAAP to non-GAAP results, please see the tables below.

“We closed out the first half of the year with solid sales execution and financial results,” said Q2 Chairman and CEO Matt Flake. “We’ve had broad sales success for several consecutive quarters, highlighted by a mix of net new and expansion wins across our lines of business. We believe our sustained performance not only demonstrates our competitive differentiation and a strong demand environment, but also the resilience of our customers and prospects in the current economic climate.”

Second Quarter Highlights

Continued Sales Success Driven by both New Customer Wins and Expansion Opportunities

•Signed four Tier 1 digital banking contracts, including:
◦Two new banks; one for Q2's commercial solutions and the other to utilize its retail, SMB and commercial solutions.
◦Two expansion agreements with existing customers, resulting in both customers now utilizing retail, SMB and commercial solutions.

•Signed one Enterprise and one Tier 1 relationship pricing contract, including:
◦A new Tier 1 bank to utilize the relationship pricing platform and treasury pricing solutions.
◦An expansion win with an Enterprise bank to increase their utilization of Q2's relationship pricing platform, and the addition of the treasury pricing solutions.

•Signed a multi-year renewal with a top ten Helix customer.

•Subscription Annualized Recurring Revenue increased to $633.9 million, up 19 percent year-over-year from $533.2 million at the end of the second quarter of 2023.

•Remaining Performance Obligations total, or Backlog, increased by $38 million sequentially and a record $426 million year-over-year, resulting in a total committed Backlog of approximately $2.0 billion at quarter-end, representing 2 percent sequential growth and 28 percent year-over-year growth.




Annual Customer Conference Showcases Q2's AI, Digital Transformation, and Innovation Priorities

In the second quarter, Q2 hosted its annual customer conference, "CONNECT," where the company shared its strategic product roadmaps and innovation priorities. This year marked the highest attendance ever, reaffirming that customers are deeply engaged and enthusiastic about Q2's roadmap and eager to grow their businesses with technology. Key themes emerged from the conference, including the practical application of AI, developments with Q2 Innovation Studio, and insights on Q2 Engage, Q2’s recently announced comprehensive portfolio of consumer banking solutions.

Q2's AI product strategy was a highlight of the conference, with a particular focus on generative AI and plans to implement a digital assistant, Andi Copilot. Q2 expects to integrate Andi Copilot into its banking product portfolio as well as through Q2's risk and fraud management platform, Centrix. This next generation of Andi Copilot is being designed to combine Q2's deep knowledge of the banking industry with advanced large language model capabilities to service a range of new, high-value use cases for bank operations personnel.

Q2 Innovation Studio remained a key focus for customers, with more fintech partners attending than any previous year. Customers shared success stories with peers, inspiring new ways to utilize the software. The breadth and maturity of Q2's partner ecosystem continue to be significant differentiators for the company.

With customers focused on driving deeper personalization in consumer banking, Q2 also demonstrated how Q2 Engage was designed to assist these customers in better competing for, acquiring, and retaining deposits. By streamlining the structure of its consumer-facing product suite under one platform, Q2 aims to sharpen the consumer value proposition and drive further differentiation for its customers.

“We were pleased to deliver another strong quarter, highlighted by both revenue and adjusted EBITDA results above the high end of our guidance,” said Q2 CFO David Mehok. “Our results reflect our sustained focus on operational improvement, which has generated significant growth in adjusted EBITDA and cash flow for the first half of the year, combined with better-than-expected subscription revenue. Following these strong results, we are raising our full-year outlook for revenue and adjusted EBITDA and increasing our full-year outlook for subscription revenue growth.”

Financial Outlook

As of July 31, 2024, Q2 Holdings is providing guidance for its third quarter of 2024 and updated guidance for its full year 2024, which represents Q2 Holdings’ current estimates on Q2 Holdings’ operations and financial results. 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, transaction-related costs, interest and other (income) expense, income taxes, lease and other restructuring charges, gain 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 forward-looking adjusted EBITDA guidance to GAAP net loss. However, it is important to note that these excluded items could be material to Q2's results computed in accordance with GAAP in future periods.

Q2 Holdings is providing guidance for its third quarter of 2024 as follows:

•Total non-GAAP revenue of $171.5 million - $174.5 million, which would represent year-over-year growth of 11 - 13 percent.

•Adjusted EBITDA of $27.5 million - $29.5 million, representing 16 - 17 percent of non-GAAP revenue for the quarter.

Q2 Holdings is providing updated guidance for the full-year 2024 as follows:

•Total non-GAAP revenue of $688.5 million - $692.5 million, which would represent year-over-year growth of 10 - 11 percent.



•Adjusted EBITDA of $116.5 million - $119.5 million, representing 17 percent of non-GAAP revenue for the year.

Conference Call Details
Date:
Wednesday, July 31, 2024
Time:5:00 p.m. EDT
Hosts:
Matt Flake, Chairman & CEO / David Mehok, CFO / Kirk Coleman, President / Jonathan Price, EVP Strategy and Emerging Businesses
Conference Call Registration:https://registrations.events/direct/Q4I6081040
Webcast Registration:https://events.q4inc.com/attendee/610211826
All participants must register using the above links (either the webcast or conference call). A webcast of the conference call and financial results 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 call. 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 leading provider of digital transformation solutions for financial services, serving banks, credit unions, alternative finance companies, and fintechs in the U.S. and internationally. Q2 enables its financial institution and fintech customers to provide comprehensive, data-driven digital engagement solutions for consumers, small businesses and corporate clients. Headquartered in Austin, Texas, Q2 has offices worldwide and is publicly traded on the NYSE under the stock symbol QTWO. To learn more, please visit Q2.com. Follow us on LinkedIn and X to stay up to date.

Use of Non-GAAP Measures

Q2 uses the following non-GAAP financial measures: non-GAAP revenue; adjusted EBITDA; adjusted EBITDA margin; 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); and free cash flow. 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, transaction-related costs, lease and other restructuring charges, gain on extinguishment of debt and the impact to deferred revenue from purchase accounting. In the case of adjusted EBITDA margin, Q2 calculates adjusted EBITDA margin by dividing adjusted EBITDA by non-GAAP revenue. 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, transaction-related costs, lease and other restructuring charges 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), Q2 adjusts operating income (loss), for stock-based compensation, transaction-related costs, amortization of acquired technology, amortization of acquired intangibles, lease and other restructuring charges, and the impact to deferred revenue from purchase accounting. In the case of free cash flow, Q2 adjusts net cash provided by (used in) operating activities for purchases of property and equipment and capitalized software development costs.

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.

Forward-looking Statements

This press release contains forward-looking statements, including statements about: our sustained performance; our competitive differentiation; the strong demand environment; the resilience of our customers and prospects in the current economic climate; customer engagement and enthusiasm about our roadmap and desire to grow their businesses with technology; our AI product strategy; the anticipated launch, capabilities and use cased of Andi Copilot; the competitive differentiation resulting from the breadth and maturity of our partner ecosystem; customer focus on driving deeper personalization in consumer banking; the anticipated capabilities and benefits of Q2 Engage; and our quarterly and annual financial guidance. The forward-looking statements contained in this press release are based upon our 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 risks related to: (a) global macroeconomic uncertainties and challenges or changes in the financial services industry and credit markets, including as a result of recent bank failures, mergers and acquisitions in the banking sector, inflation, higher interest rates and any potential additional monetary policy measures and their potential impacts on our prospects' and customers' operations, the timing of prospect and customer implementations and purchasing decisions, our business sales cycles and on account holder or end user, or End User, usage of our solutions; (b) the risk of increased or new competition in our existing markets and as we enter new markets or new segments of existing markets, or as we offer new solutions; (c) the risks associated with the development of our solutions including AI-based solutions, and changes to the market for our solutions compared to our expectations; (d) quarterly fluctuations in our operating results relative to our expectations and guidance and the accuracy of our forecasts; (e) the risks and increased costs associated with managing growth and global operations, including hiring, training, retaining and motivating employees to support such growth, particularly in light of recent macroeconomic challenges, including increased competition for talent, employee turnover, labor shortages and wage inflation; (f) the risks associated with our transactional business which are typically driven by End-User behavior and can be influenced by external drivers outside of our control; (g) the risks associated with effectively managing our business and cost structure in an uncertain macroeconomic environment, including as a result of challenges in the financial services industry and the effects of seasonality and unexpected trends; (h) the risks associated with geopolitical uncertainties, including the heightened risk of state-sponsored cyberattacks or cyber fraud on financial services and other critical infrastructure, and political uncertainty or discord, including related to the 2024 U.S. presidential election; (i) the risks associated with accurately forecasting and managing the impacts of any macroeconomic downturn or challenges in the financial services industry on our customers and their End Users, including in particular the impacts of any downturn on financial technology companies, or FinTechs, or alternative finance companies, or Alt-FIs, and our arrangements with them, which represent a newer market opportunity for us, a more complex revenue model for us and which may be more vulnerable to an economic downturn than our financial institution customers; (j) the challenges and costs associated with selling, implementing and supporting our solutions, particularly for larger customers with more complex requirements and longer implementation processes, including risks related to the timing and predictability of sales of our solutions and the impact that the timing of bookings may have on our revenue and financial performance in a period; (k) the risk that errors, interruptions or delays in our solutions or Web hosting negatively impacts our business and sales; (l) the risks associated with cyberattacks, financial transaction fraud, data and privacy breaches and breaches of security measures within our products, systems and infrastructure or the products, systems and infrastructure of third parties upon which we rely upon and the resultant costs and liabilities and harm to our business and reputation and our ability to sell our solutions; (m) the difficulties and risks associated with developing and selling complex new solutions and enhancements, including those using artificial intelligence, or AI, with the technical and regulatory specifications and functionality required by our customers and relevant governmental authorities; (n) risks associated with operating within and selling into a regulated industry, including risks related to evolving regulation of AI and machine learning, the receipt, collection, storage, processing and transfer of data and increased


regulatory scrutiny in financial technology, including specifically on banking-as-a-service, or BaaS, services; (o) the risks associated with our sales and marketing capabilities, including partner relationships and the length, cost and unpredictability of our sales cycle; (p) the risks inherent in third-party technology and implementation partnerships that could cause harm to our business; (q) the risk that we will not be able to maintain historical contract terms such as pricing and duration; (r) the general risks associated with the complexity of our customer arrangements and our solutions; (s) the risks associated with integrating acquired companies and successfully selling and maintaining their solutions; (t) litigation related to intellectual property and other matters and any related claims, negotiations and settlements; (u) the risks associated with further consolidation in the financial services industry; (v) the risks associated with selling our solutions internationally and with the continued expansion of our international operations; and (w) the risk that our debt repayment obligations may adversely affect our financial condition and that we 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)
June 30, 2024December 31, 2023
Assets
Current assets:
Cash and cash equivalents$303,823 $229,655 
Restricted cash2,517 3,977 
Investments68,227 94,353 
Accounts receivable, net59,435 42,899 
Contract assets, current portion, net8,776 9,193 
Prepaid expenses and other current assets12,535 11,625 
Deferred solution and other costs, current portion26,657 27,521 
Deferred implementation costs, current portion9,413 8,741 
Total current assets491,383 427,964 
Property and equipment, net35,491 41,178 
Right of use assets33,411 35,453 
Deferred solution and other costs, net of current portion30,094 26,090 
Deferred implementation costs, net of current portion23,151 21,480 
Intangible assets, net108,402 121,572 
Goodwill512,869 512,869 
Contract assets, net of current portion and allowance11,238 12,210 
Other long-term assets2,985 2,609 
Total assets$1,249,024 $1,201,425 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and accrued liabilities$55,948 $62,404 
Deferred revenues, current portion134,361 118,723 
Lease liabilities, current portion10,895 10,436 
Total current liabilities201,204 191,563 
Convertible notes, net of current portion491,456 490,464 
Deferred revenues, net of current portion24,334 17,350 
Lease liabilities, net of current portion41,771 45,588 
Other long-term liabilities9,594 7,981 
Total liabilities768,359 752,946 
Stockholders' equity:
Common stock6 6 
Additional paid-in capital1,134,462 1,075,278 
Accumulated other comprehensive loss(1,206)(1,111)
Accumulated deficit(652,597)(625,694)
Total stockholders' equity480,665 448,479 
Total liabilities and stockholders' equity$1,249,024 $1,201,425 


Q2 Holdings, Inc.
Condensed Consolidated Statements Of Comprehensive Loss
(in thousands, except per share data)
(unaudited)

Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Revenues (1)
$172,890 $154,531 $338,398 $307,539 
Cost of revenues (2)
86,063 80,703 169,319 160,414 
Gross profit86,827 73,828 169,079 147,125 
Operating expenses:
Sales and marketing27,733 28,701 53,178 56,845 
Research and development35,759 34,096 70,621 68,521 
General and administrative31,283 27,127 61,459 51,819 
Transaction-related costs— 9 — 21 
Amortization of acquired intangibles4,788 5,252 9,616 10,514 
Lease and other restructuring charges967 2,312 2,093 4,273 
Total operating expenses100,530 97,497 196,967 191,993 
Loss from operations(13,703)(23,669)(27,888)(44,868)
Total other income (expense), net (3)
2,732 526 4,629 21,227 
Loss before income taxes(10,971)(23,143)(23,259)(23,641)
Provision for income taxes(2,089)(479)(3,644)(497)
Net loss$(13,060)$(23,622)$(26,903)$(24,138)
Other comprehensive income (loss):
Unrealized gain (loss) on available-for-sale investments51 (174)177 862 
Foreign currency translation adjustment49 180 (272)163 
Comprehensive loss$(12,960)$(23,616)$(26,998)$(23,113)
Net loss per common share:
Net loss per common share, basic and diluted$(0.22)$(0.41)$(0.45)$(0.42)
Weighted average common shares outstanding, basic and diluted60,162 58,286 59,804 58,087 

(1) Includes deferred revenue reduction from purchase accounting of zero and $0.1 million for the three months ended June 30, 2024 and 2023, respectively, and zero and $0.2 million for the six months ended June 30, 2024 and 2023, respectively.
(2) Includes amortization of acquired technology of $5.5 million and $5.9 million for the three months ended June 30, 2024 and 2023, respectively, and $11.0 million and $11.8 million for the six months ended June 30, 2024 and 2023, respectively.
(3) Includes a gain of $19.9 million related to the early extinguishment of a portion of our 2026 Notes and 2025 Notes for the six months ended June 30, 2023.



Q2 Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

Six Months Ended June 30,
20242023
Cash flows from operating activities:
Net loss$(26,903)$(24,138)
Adjustments to reconcile net loss to net cash from operating activities:
Amortization of deferred implementation, solution and other costs13,115 12,447 
Depreciation and amortization35,168 35,478 
Amortization of debt issuance costs991 1,113 
Amortization of premiums and discounts on investments(443)(1,781)
Stock-based compensation expense45,132 38,710 
Deferred income taxes944 (556)
Gain on extinguishment of debt— (19,312)
Other non-cash items496 2,043 
Changes in operating assets and liabilities(19,034)(27,042)
Net cash provided by operating activities49,466 16,962 
Cash flows from investing activities:
Net maturities of investments26,745 74,284 
Purchases of property and equipment(2,856)(3,294)
Capitalized software development costs(11,835)(13,127)
Net cash provided by investing activities12,054 57,863 
Cash flows from financing activities:
Payment for maturity of 2023 convertible notes— (10,908)
Payment for repurchases of convertible notes— (149,640)
Proceeds from capped calls related to convertible notes— 139 
Proceeds from the exercise of stock options and ESPP11,448 3,933 
Net cash provided by (used in) financing activities11,448 (156,476)
Effect of exchange rate changes on cash, cash equivalents and restricted cash(260)276 
Net increase (decrease) in cash, cash equivalents and restricted cash72,708 (81,375)
Cash, cash equivalents and restricted cash, beginning of period233,632 201,902 
Cash, cash equivalents and restricted cash, end of period$306,340 $120,527 


Q2 Holdings, Inc.
Reconciliation of GAAP to Non-GAAP Measures
(in thousands)
(unaudited)
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
GAAP revenue$172,890 $154,531 $338,398 $307,539
Deferred revenue reduction from purchase accounting— 83 — 199 
Non-GAAP revenue$172,890 $154,614 $338,398 $307,738 
GAAP gross profit$86,827 $73,828 $169,079 $147,125 
Stock-based compensation3,400 3,577 6,565 6,950 
Amortization of acquired technology5,504 5,883 11,008 11,763 
Lease and other restructuring charges588 429 595 429 
Deferred revenue reduction from purchase accounting— 83 — 199 
Non-GAAP gross profit$96,319 $83,800 $187,247 $166,466 
Non-GAAP gross margin:
Non-GAAP gross profit$96,319 $83,800 $187,247 $166,466 
Non-GAAP revenue172,890 154,614 338,398 307,738 
Non-GAAP gross margin55.7 %54.2 %55.3 %54.1 %
GAAP sales and marketing expense$27,733 $28,701 $53,178 $56,845 
Stock-based compensation(4,469)(4,823)(8,340)(9,083)
Non-GAAP sales and marketing expense$23,264 $23,878 $44,838 $47,762 
GAAP research and development expense$35,759 $34,096 $70,621 $68,521 
Stock-based compensation(4,625)(4,007)(8,468)(7,783)
Non-GAAP research and development expense$31,134 $30,089 $62,153 $60,738 
GAAP general and administrative expense$31,283 $27,127 $61,459 $51,819 
Stock-based compensation(11,837)(8,217)(21,759)(14,894)
Non-GAAP general and administrative expense$19,446 $18,910 $39,700 $36,925 
GAAP operating loss$(13,703)$(23,669)$(27,888)$(44,868)
Deferred revenue reduction from purchase accounting— 83 — 199 
Stock-based compensation24,331 20,624 45,132 38,710 
Transaction-related costs— 9 — 21 
Amortization of acquired technology5,504 5,883 11,008 11,763 
Amortization of acquired intangibles4,788 5,252 9,616 10,514 
Lease and other restructuring charges 1,555 2,741 2,688 4,702 
Non-GAAP operating income$22,475 $10,923 $40,556 $21,041 
Reconciliation of GAAP net loss to adjusted EBITDA:
GAAP net loss$(13,060)$(23,622)$(26,903)$(24,138)
Deferred revenue reduction from purchase accounting— 83 — 199 
Stock-based compensation24,331 20,624 45,132 38,710 
Transaction-related costs— 9 — 21 
Depreciation and amortization17,645 17,935 35,168 35,478 
Lease and other restructuring charges 1,555 2,741 2,688 4,702 
Provision for income taxes2,089 479 3,644 497 
Gain on extinguishment of debt— — — (19,869)
Interest and other (income) expense, net(2,689)(623)(4,625)(1,502)
Adjusted EBITDA$29,871 $17,626 $55,104 $34,098 
Adjusted EBITDA margin17.3 %11.4 %16.3 %11.1 %


Q2 Holdings, Inc.
Reconciliation of Free Cash Flow
(in thousands)
(unaudited)

Six Months Ended June 30,
20242023
Net cash provided by operating activities$49,466 $16,962 
Purchases of property and equipment(2,856)(3,294)
Capitalized software development costs(11,835)(13,127)
Free cash flow$34,775 $541 



Q2 Holdings, Inc.
Reconciliation of GAAP to Non-GAAP Revenue Outlook
(in thousands)
(unaudited)

Q3 2024 OutlookFull Year 2024 Outlook
LowHighLowHigh
GAAP revenue$171,500 $174,500 $688,500 $692,500 
Deferred revenue reduction from purchase accounting— — — — 
Non-GAAP revenue$171,500 $174,500 $688,500 $692,500 



MEDIA CONTACT:INVESTOR CONTACT:
Jean Kondo
Josh Yankovich
Q2 Holdings, Inc.Q2 Holdings, Inc.
M: +1-510-823-4728
O: +1-512-682-4463
jean.kondo@Q2.com
josh.yankovich@Q2.com

v3.24.2
Cover Page
Jul. 31, 2024
Entity Addresses [Line Items]  
Document Type 8-K
Document Period End Date Jul. 31, 2024
Entity Registrant Name Q2 HOLDINGS, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-36350
Entity Tax Identification Number 20-2706637
Entity Address, Address Line One 10355 Pecan Park Boulevard
Entity Address, City or Town Austin
Entity Address, State or Province TX
Entity Address, Postal Zip Code 78729
City Area Code 833
Local Phone Number 444-3469
Title of 12(b) Security Common Stock, $0.0001 par value
Trading Symbol QTWO
Security Exchange Name NYSE
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Entity Central Index Key 0001410384
Amendment Flag false
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