Q2 Holdings reported its third‑quarter 2025 financial results, posting revenue of $201.7 million—$4.2 million above the $197.46 million consensus estimate and a 15% year‑over‑year increase driven by a 12% rise in subscription revenue and record bookings across its enterprise segment.
Adjusted earnings per share reached $0.57, beating the $0.55 consensus by $0.02 (3.6%). The beat reflects disciplined cost management and a higher mix of high‑margin subscription contracts, while the GAAP EPS of $0.23 is a separate metric that does not affect the adjusted earnings narrative.
Gross margins expanded, with GAAP gross margin at 54.0% versus 50.9% a year earlier and non‑GAAP gross margin at 57.9% versus 56.0%. The improvement is largely attributable to the shift toward subscription revenue and operational efficiencies that lowered cost of sales relative to revenue growth.
Management raised its full‑year 2025 outlook, projecting revenue of $789.0 million to $793.0 million and adjusted EBITDA of $182.5 million to $185.5 million—up from the prior guidance—signaling confidence in sustained demand and continued cost discipline.
The company also authorized a $150 million share‑repurchase program, underscoring confidence in its cash‑flow generation and a commitment to returning value to shareholders. Executive changes include Hima Mukkamala’s promotion to Chief Operating Officer, Kirk Coleman’s appointment as Chief Business Officer, and Mike Volanoski’s departure after a transition period.
Investors responded positively to the revenue beat, EPS beat, guidance upgrade, and buyback authorization, reflecting confidence in Q2 Holdings’ growth trajectory and strategic focus on subscription‑driven profitability.
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