Slide 1: Investor presentation
Investor presentation Philippe Courtot, Chairman and CEO Melissa Fisher, CFO February 12th, 2018
Slide 2: Safe harbor
Safe harbor This presentation includes forward-looking statements within the meaning of the federal securities laws. Forward- looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this presentation include, but are not li
Slide 3: Investment highlights
Investment highlights Leading SaaS security and compliance solutions cloud platform Uniquely positioned to capitalize on the stack consolidation and move to the cloud Multiple levers of recurring revenue growth Scalable business model and industry-leading profitability 2
Slide 4: Qualys: Next-gen Security and Compliance Platform
Qualys: Next-gen Security and Compliance Platform Next-gen public Next-gen public cloud Next-gen Next-gen cloud infrastructure infrastructure Incumbents applications applications Source: Morgan Stanley 3
Slide 5: Qualys Cloud Platform Benefits
Qualys Cloud Platform Benefits 2-second visibility across all of your global IT assets (on-premises, endpoints and cloud assets) Continuous assessment of your global security & compliance posture Identify vulnerable and compromised assets Consolidate all your security and compliance stacks Secure yo
Slide 6: End-to-end Security Architecture
End-to-end Security Architecture Automated continuous monitoring & response Discovery Prevention Detection Response On-prem Security Hygiene Endpoint Activity Security Cloud Vulnerability Cloud Infra Orchestration Mobile Devices Assessment Monitoring Incident Response OT/ICS Threat Network Activity
Slide 7: Qualys Sensors
Qualys Sensors Scalable, self-updating & centrally managed Physical Virtual Cloud/Container Cloud Agents Passive API Legacy data Private cloud Commercial IaaS Light weight, Passively sniff on Integration with centers infrastructure & PaaS clouds multi-platform network Threat Intel feeds Corporate Vi
Slide 8: The Backend
The Backend Scalable, Micro-services, DevOps VM PC WAS WAF FIM Scanner Service Qualys Streaming Data Backbone Cloud Agent Asset Service Indexing Reporting Analytics IOC Tagging Service Service 7
Slide 9: Qualys Cloud Platform
Qualys Cloud Platform Unified approach to detection, prevention & response Integrated Suite of Applications … Analytics and Reporting Engines Distributed Sensors Hardware Virtual Cloud Agent Passive API Environments On-Premises 8 Endpoints Cloud 8
Slide 10: Qualys Cloud Platform Apps
Qualys Cloud Platform Apps ASSET MANAGEMENT Asset Inventory CMDB Sync Cloud Inventory (Beta) Maintain full, instant visibility of all your Synchronize asset information from Qualys Inventory of all your cloud assets across global IT assets into ServiceNow CMDB AWS, Azure, GCP and others Certificate
Slide 11: See the results in one place anytime, anywhere
See the results in one place anytime, anywhere Via dynamic and customizable dashboards and centrally managed, self-updating, integrated Cloud Apps in a single-pane-of-glass UIs (AssetView, CloudView, CertView…) 1+ trillion 250+ billion Security Events Data Points Indexed on Elasticsearch Clusters 3+
Slide 12: 2018 Roadmap
2018 Roadmap 1H 2018 2H 2018 Container Security (GA) Patch Management (Beta) Discover, track, and continuously protect containers Cross platform unified patch management to respond quickly to critical vulnerabilities Cloud Inventory (GA) Inventory of all your cloud assets across Secure Access Contro
Slide 13: Qualys Cloud Platform enables vendor and stack consolidation
Qualys Cloud Platform enables vendor and stack consolidation IT Security Compliance Monitoring Web Application Security New Services 12
Slide 14: Large expanding market opportunity
Large expanding market opportunity Qualys has taken the #1 market-share position over IBM and HP in the $1.7B Vulnerability Assessment Market 20% Qualys growth (1) 11% CAGR CAGR $8.9B New Services Coming (IOC, FIM, PM, $1.0B CertView, CloudView…) $0.7B $1.3B 3% Other Security $5.3B $0.9B 8% Web Secu
Slide 15: Blue chip global customer base
Blue chip global customer base 74% of the Forbes Global 50, 47% of Global 500, and 25% of Global 2000 standardized on Qualys 9 of the top 10 in Software 10,300+ Customers 8 of the top 10 in Consumer Discretionary 8 of the top 10 in Consumer Staples 8 of the top 10 in Major Banks DAIMLER 8 of the top
Slide 16: Scalable go-to-market model
Scalable go-to-market model Market segmentation & key strategic partners ENTERPRISE SME & SMB 2017 Large enterprise Small / medium business REVENUES (Over 5,000 employees) (Up to 5,000 employees) Direct New Existing New Existing customers customers customers customers 60% Channel 40% 15
Slide 17: Attractive value proposition for partners
Attractive value proposition for partners High-margin recurring revenue with no capex MSSPs Outsourcing VAS telcos resellers Consultants providers 16
Slide 18: Strong global presence
Strong global presence 10,300+ 130+ 6 50 47 Customers Countries Shared Platforms Private Clouds Locations Qualys locations 17
Slide 19: Strong and consistent organic revenue growth
Strong and consistent organic revenue growth Outperforming market and gaining share ($ in millions) 20% CAGR $231 $198 Revenues $164 $134 2014 2015 2016 2017 18
Slide 20: Strong customer retention drives land and expand
Strong customer retention drives land and expand ($ in millions) Quarterly revenues vs. customers $70 $60 $50 $40 10,300+ $30 Initial solution $20 Expansion of initial solution $10 Additional solutions 2009 2012 2015 2017 Future products Quarterly revenues Customers 19
Slide 21: Increasing Cloud Agent Adoption
Increasing Cloud Agent Adoption (Units in millions) Number of Cloud Agents Sold 6.0 4.7 3.4 2.6 LTM LTM LTM LTM Q1 2017 Q2 2017 Q3 2017 Q4 2017 20
Slide 22: Platform adoption accelerating
Platform adoption accelerating % of Enterprise customers with 4+ Qualys products has almost doubled in the last year Percent of Enterprise customers Percent of Enterprise customers with 3 or more Qualys solutions with 4 or more Qualys solutions 32% 26% 20% 15% 16% 8% 3% 1% 2014 2015 2016 2017 2014 2
Slide 23: Multiplier effect
Multiplier effect Enterprise customers with 4+ products spend more than 5x 1-product customers ($ in thousands) $300 5x $239 of 1-product $250 Avg. LTM revenues average per customer $200 $179 $151 $150 $182 $111 $154 $100 $131 $60 $50 $42 $46 $50 $47 $0 2014 2015 2016 2017 Enterprise customers Enter
Slide 24: Our largest customers spend an average of LTM $1M+ with Qualys
Our largest customers spend an average of LTM $1M+ with Qualys ($ in millions) $80 51 $70 50 Cumulative revenues $60 38 $54 40 Customers $50 27 30 $40 $35 19 $30 $25 20 $20 $17 10 $10 $0 0 2014 2015 2016 2017 Note: Customer count is defined as customers with greater than $500K in annual revenue 23
Slide 25: Platform enables scalable operational model
Platform enables scalable operational model Revenue per % of Customer Support, S&M headcount Operations, and R&D headcount in India $1.2M 58% $1.0M $1.1M $0.9M 46% 36% 28% 2014 2015 2016 2017 2014 2015 2016 2017 High sales leverage Leveraging low cost geos 24
Slide 26: Increasing adjusted EBITDA & operating cash flow
Increasing adjusted EBITDA & operating cash flow ($ in millions) 47% 40% 37% 34% $108 34% 34% $85 31% 24% $68 $66 $68 $57 $41 $32 2014 2015 2016 2017 2014 2015 2016 2017 Adjusted Adjusted EBITDA Operating Operating cash EBITDA margin (%) cash flow flow margin (%) 25
Slide 27: Industry-leading margins and scalable business model
Industry-leading margins and scalable business model Q3 CY2017 EBITDA margin vs. QLYS select Security and SaaS peers 40% Security SaaS Peer average: 6% Source: JPMorgan 26
Slide 28: Unique advantages of the Qualys Cloud Platform
Unique advantages of the Qualys Cloud Platform No hardware to Lower Easy to deploy Unprecedented buy or manage operating costs and maintain scaling Nothing to install or With everything in the Easily perform assessments Qualys Cloud Platform is a manage, and all services cloud, there are no capital
Slide 29: Revenue guidance range
Revenue guidance range ($ in millions) Q1 2018 2018 Revenue guidance range $63.4 $64.1 $275.5 $278.5 Y/Y revenue growth under 19.3% 20.6% 19.3% 20.6% US GAAP 28
Slide 30: Appendix
Appendix 29
Slide 31: Reconciliation of Adjusted EBITDA
Reconciliation of Adjusted EBITDA ($ in millions) 2017 2016 2015 2014 Net income $40.4 $19.2 $15.9 $30.2 Depreciation and amortization of property 19.8 16.6 14.0 11.5 and equipment Amortization of intangible assets 0.8 0.4 0.4 0.4 Provision for (benefit from) income taxes (1.1) 11.2 8.7 (21.6) Stock