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On August 4, Qualys Inc. (NASDAQ:QLYS) reported second-quarter revenue of $182.2 million, up 11% from a year earlier, and used the moment to raise its own bar for the rest of 2026. A company that was already growing at a healthy clip just told Wall Street it expects to grow even more than it previously promised, and it backed that up with a jump in cash generation that outpaced revenue by a wide margin.
Qualys grew revenue from $164.1 million to $182.2 million year over year, and the profit line grew even faster. GAAP operating income rose 20% to $61.9 million, pushing the operating margin to 34% from 31% a year earlier. Non-GAAP operating income climbed 16% to $81.4 million, a 45% margin compared to 43% in the same period last year. Adjusted EBITDA rose 14% to $83.8 million, a 46% margin. Operating cash flow told the sharpest story of the quarter, jumping 77% to $59.6 million from $33.8 million, which lifted cash flow as a share of revenue to 33% from 21%.
On the back of that quarter, Qualys raised its full-year revenue guidance to a range of $732.0 million to $738.0 million, up from a prior range of $721.0 million to $727.0 million. Full-year non-GAAP earnings per share guidance moved up to $7.74 to $7.88, from $7.44 to $7.65, and GAAP earnings per share guidance rose to $5.76 to $5.90. The company also pointed to expanding platform reach during the quarter, including a FedRAMP High Authorization for its TotalCloud solution, sponsored by the US Drug Enforcement Administration, which brings cloud-native application protection capabilities onto the FedRAMP Marketplace for federal and other regulated customers.
The guidance raise came with a smaller growth number attached. Third quarter revenue guidance of $185.5 million to $187.5 million implies growth of 9% to 10%, down from the 11% Qualys just posted, and the full-year guidance range of 9% to 10% growth points the same direction. The gap between GAAP and non-GAAP results also widened this quarter, with GAAP net income of $52.4 million sitting well below the $69.2 million non-GAAP figure, a distance driven by adjustments that GAAP accounting does not recognize.
Qualys leaned on a busy stretch of announcements to make its case for the next leg of growth, including a Converge partnership tied to cyber insurance discounts, four international ROCon customer conferences, and Frost & Sullivan recognition in cloud and application runtime security. Those are the kinds of announcements that build a longer-term pipeline rather than move the needle immediately, and the guidance itself suggests management is not pricing in an acceleration from here.
Hedge fund ownership rose from 33 funds to 34 in the most recent quarter, a modest gain that suggests institutional interest is holding steady rather than surging. Short interest sits at 16.17% of the float, a level that points to a meaningful bear camp positioned against the stock. Qualys trades at a forward P/E of 20.62 as of September 4, a multiple that does not scream expensive for a company posting double-digit growth and expanding margins. That combination suggests that the market is still debating whether Qualys can hold its growth rate rather than assuming the answer.
Qualys enters the second half of 2026 with a stronger cash flow profile and a higher earnings bar than it set for itself three months ago, which is not a small thing for a company already growing revenue at a double-digit clip. But the same guidance that raised full-year numbers also guided growth down from where it stood in the second quarter, and the elevated short interest shows plenty of investors are not fully convinced. For the growth story to keep gaining ground, the federal pipeline and newer products like QFlex need to translate into bookings rather than just headlines.
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