Q2 Holdings, Inc. · NYSE:QTWO
Q2 — Q1 2023 Earnings Presentation
19 slides from Q2's earnings presentation, May 9, 2023
Slide 1: 1st Quarter 2023 Results
st 1 Quarter 2023 Results May 9, 2023 The information in the following presentation is confidential and proprietary.
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation and the accompanying oral presentation contain forward-looking statements and information that are based on our management's beliefs and assumptions and on information currently available to our management. The statements and information contained in this pres
Slide 3: 1st Quarter 2023 Review
1st Quarter 2023 Review $271.7M End of Quarter balance of cash, cash equivalents & investments3 $ 672.7M $ 16.5M 153.1M in Adjusted EBITDA4 Annualized Recurring Revenue1 $ 4 $1.53B ending backlog as of 14% March 31, 2023 NON-GAAP REVENUE non-GAAP revenue growth 3 year-over-year4 Tier One Digital Ban
Slide 4: 1st Quarter 2023 Results
1st Quarter 2023 Results “We delivered strong financial results and sales execution in the first quarter, in spite of a 1Q’23 1Q’22 complex backdrop in the regional and community banking space.” Totals Y/Y Change Totals “In times like these, I believe our technology is Revenue $153,008 14% $134,071
Slide 5: 1st Quarter 2023 Highlights
1st Quarter 2023 Highlights New Customer Wins including Three Tier 1 Digital Banking Deals • Top 100 U.S. bank to utilize our retail, commercial, and small business banking solutions, representing a top 5 digital banking win in company history by initial contract value. • Top 100 U.S. bank to utiliz
Slide 6: Annualized Recurring Revenue
Annualized Recurring Revenue Growth driven by subscription bookings, partially offset by a moderation of growth in discretionary services and transactional revenue 13% Y/Y Growth 20% Y/Y Growth $672.7 $ in Millions $594.2 $493.6 Q1'21 Q1'22 Q1'23 6
Slide 7: Remaining Performance Obligations (RPO, Backlog)
Remaining Performance Obligations (RPO, Backlog) Growth driven by a Record Digital Banking Bookings Quarter and Better than Expected Renewal Activity $ 1.53B 10% Y/Y Growth 3% Q/Q Growth RPO Balance as of March 31, 2023 $ in Billions $ in Billions RPO Expected to % of Total RPO be Recognized in Amou
Slide 8: Digital Banking Registered User Growth
Digital Banking Registered User Growth Driven primarily from organic user growth and new customer go-lives 9% Y/Y Growth 8% Y/Y Growth 21.5 In Millions 19.7 18.3 Added approximately 1.8M Users Year-over-year Q1'21 Q1'22 Q1'23 1 Registered Users as defined in the appendix of this presentation. 8
Slide 9: Financial Outlook
Financial Outlook Representing 9-11% full year revenue growth and full year adjusted EBITDA margins of 11% Q2 2023 Full Year 2023 Low High Low High Non-GAAP Revenue $153.1 $155.1 $618.0 $630.0 Adj EBITDA $14.0 $16.0 $67.0 $71.0 $ In Millions $ In Millions As of May 9, 2023, Q2 Holdings is providing
Slide 10: Appendix
Appendix The information in the following presentation is confidential and proprietary.
Slide 11: Strong Visibility, Increasing Profitability, Expanding Opportunity
Strong Visibility, Increasing Profitability, Expanding Opportunity Long Runway to sustain High Growth and Margin Expansion +1,400 Intermediate Target 13% +5 Years ~75% Subscription revenue Total Customers1 YoY Growth in ARR2 Avg. Contract Length3 as a % of Total4 YoY Revenue Growth + Adj EBITDA Marg
Slide 12: Condensed Consolidated Balance Sheets
Condensed Q2 Holdings, Inc. Condensed Consolidated Balance Sheets (in thousands) (unaudited) Consolidated March 31, December 31, 2023 2022 Assets Current assets: Cash and cash equivalents $ 121,256 $ 199,600 Balance Sheets Restricted cash 2,273 2,302 Investments 150,478 233,753 Accounts receivable,
Slide 13: Condensed Consolidated Statements of Comprehensive Loss
Condensed Q2 Holdings, Inc. Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands, except per share data) Consolidated (unaudited) Three Months Ended March 31, 2023 2022 Statements of Revenues (1) Cost of revenues (2) Gross profit $ 153,008 79,711 73,297 $ 134,071 73,672 60,
Slide 14: Condensed Consolidated Statements of Cash Flows
Condensed Q2 Holdings, Inc. Consolidated Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) Statements of Three Months Ended March 31, 2023 2022 Cash flows from operating activities: Net loss $ (516) $ (23,559) Cash Flows Adjustments to reconcile net loss to net cash from ope
Slide 15: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures Q2 Holdings, Inc. Reconciliation of GAAP to Non-GAAP Measures (in thousands) (unaudited) Three Months Ended March 31, 2023 2022 GAAP revenue $ 153,008 $ 134,071 Deferred revenue reduction from purchase accounting 116 242 Non-GAAP revenue $ 153,124 $ 134,31
Slide 16: Reconciliation of GAAP to Non-GAAP Revenue Guidance
Reconciliation of GAAP to Non-GAAP Revenue Guidance Q2 Holdings, Inc. Reconciliation of GAAP to Non-GAAP Revenue Outlook (in thousands) Q2 2023 Outlook Full Year 2023 Outlook Low High Low High GAAP revenue $ 153,016 $ 155,016 $ 617,655 $ 629,655 Deferred revenue reduction from purchase accounting 84
Slide 17: Definitions
Definitions Adjusted EBITDA: We define adjusted EBITDA as net loss before depreciation, amortization, stock-based compensation, certain costs related to our recent acquisitions, (benefit from) provision for income taxes, interest and other (income) expense, net, deferred revenue reduction from purch
Slide 18: Definitions
Definitions Cloud Lending Platform: Our Q2 Cloud Lending, or CL, digital lending platform is a cloud-based, end-to-end lending solution that allows financial institutions, FinTechs and Alt-FIs to automate and digitize their lending activities, supporting digital lending applications, scoring, underw
Slide 19: Definitions
Definitions Non-GAAP Revenue: We define non-GAAP revenue as total revenue excluding the impact of purchase accounting. We monitor these measures to assess our performance because we believe our revenue growth rates would be understated without these adjustments. We believe presenting non-GAAP revenu