Revenue grew steadily to $225.8M in 2026Q3 while operating margin improved from -7.9% to 15.0%, though net income of $33.2M remains sensitive to a $20.0M quarterly stock-compensation burden.
Q2 Holdings, Inc. (QTWO) annual income statement — 15-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 |
|---|
| Sales/Revenue | 870.26M | 794.81M | 696.46M | 624.62M | 565.67M | 498.72M | 402.75M | 315.48M | 241.1M | 193.98M | 150.22M | 108.87M | 79.13M | 56.87M | 41.1M | 26.98M |
| Revenue Growth % | 13.08% | 14.12% | 11.5% | 10.42% | 13.43% | 23.83% | 27.66% | 30.85% | 24.29% | 29.13% | 37.99% | 37.58% | 39.14% | 38.37% | 52.33% | - |
| Cost of Goods Sold | 362.02M | 365.22M | 341.98M | 321.97M | 309.33M | 273.69M | 228.15M | 162.49M | 121.86M | 99.48M | 77.43M | 59.13M | 46.05M | 36.26M | 25.17M | 14.79M |
| COGS % of Revenue | - | 45.95% | 49.1% | 51.55% | 54.68% | 54.88% | 56.65% | 51.5% | 50.54% | 51.29% | 51.54% | 54.31% | 58.2% | 63.76% | 61.24% | 54.83% |
| Gross Profit | 508.24M | 429.59M | 354.48M | 302.65M | 256.35M | 225.03M | 174.6M | 153M | 119.25M | 94.49M | 72.8M | 49.74M | 33.08M | 20.61M | 15.93M | 12.19M |
| Gross Margin % | 58.4% | 54.05% | 50.9% | 48.45% | 45.32% | 45.12% | 43.35% | 48.5% | 49.46% | 48.71% | 48.46% | 45.69% | 41.8% | 36.24% | 38.76% | 45.17% |
| Gross Profit Growth % | - | 21.19% | 17.13% | 18.06% | 13.91% | 28.89% | 14.12% | 28.31% | 26.19% | 29.81% | 46.35% | 50.38% | 60.47% | 29.38% | 30.72% | - |
| Operating Expenses | 398.51M | 383.95M | 396.74M | 388.71M | 361.11M | 303.03M | 274.43M | 203.72M | 146.95M | 120.17M | 102.21M | 72.09M | 52.15M | 37.73M | 23.06M | 13.87M |
| OpEx % of Revenue | - | 48.31% | 56.97% | 62.23% | 63.84% | 60.76% | 68.14% | 64.57% | 60.95% | 61.95% | 68.04% | 66.21% | 65.9% | 66.35% | 56.1% | 51.42% |
| Selling, General & Admin | 231.44M | 231.37M | 228.89M | 219.71M | 198.38M | 163.48M | 145.44M | 121.11M | 93.77M | 78.35M | 68.28M | 49.98M | 40.06M | 28.7M | 17.74M | 10.45M |
| SG&A % of Revenue | - | 29.11% | 32.87% | 35.17% | 35.07% | 32.78% | 36.11% | 38.39% | 38.89% | 40.39% | 45.45% | 45.91% | 50.63% | 50.47% | 43.17% | 38.71% |
| Research & Development | 164.98M | 154.33M | 143.24M | 137.33M | 130.1M | 116.95M | 97.38M | 76.27M | 51.33M | 40.34M | 32.46M | 21.53M | 12.09M | 9.03M | 5.32M | 3.43M |
| R&D % of Revenue | - | 19.42% | 20.57% | 21.99% | 23% | 23.45% | 24.18% | 24.18% | 21.29% | 20.8% | 21.61% | 19.78% | 15.27% | 15.88% | 12.94% | 12.7% |
| Other Operating Expenses | 1.73M | 0 | 24.61M | 31.67M | 32.63M | 22.6M | 31.61M | 6.34M | -7.35M | 429K | -209K | -3K | -492K | 0 | 0 | 0 |
| Operating Income | 109.73M | 45.64M | -42.26M | -86.06M | -104.76M | -78M | -99.83M | -50.72M | -31.85M | -26.91M | -35.72M | -24.84M | -19.07M | -17.12M | -7.13M | -1.69M |
| Operating Margin % | 12.61% | 5.74% | -6.07% | -13.78% | -18.52% | -15.64% | -24.79% | -16.08% | -13.21% | -13.87% | -23.78% | -22.82% | -24.1% | -30.11% | -17.34% | -6.25% |
| Operating Income Growth % | - | 207.99% | 50.89% | 17.85% | -34.32% | 21.87% | -96.84% | -59.24% | -18.37% | 24.67% | -43.79% | -30.25% | -11.38% | -140.21% | -322.53% | - |
| EBITDA | 152.56M | 115.06M | 26.55M | -950K | -43.1M | -23.16M | -47.99M | -14.56M | -11.11M | -12.63M | -23.52M | -17.99M | -14.99M | -14.15M | -5.43M | -674K |
| EBITDA Margin % | 17.53% | 14.48% | 3.81% | -0.15% | -7.62% | -4.64% | -11.92% | -4.62% | -4.61% | -6.51% | -15.66% | -16.53% | -18.94% | -24.88% | -13.21% | -2.5% |
| EBITDA Growth % | 102.77% | 333.45% | 2894.32% | 97.8% | -86.09% | 51.74% | -229.58% | -31.12% | 12.04% | 46.32% | -30.71% | -20.05% | -5.91% | -160.56% | -705.79% | - |
| D&A (Non-Cash Add-back) | 42.83M | 69.42M | 68.81M | 85.11M | 61.66M | 54.83M | 51.84M | 36.16M | 20.74M | 14.28M | 12.2M | 6.85M | 4.08M | 2.97M | 1.7M | 1.01M |
| EBIT | 117.2M | 60.13M | -25.92M | -56.09M | -99.4M | -78.03M | -107.56M | -63.07M | -29.04M | -26.35M | -35.36M | -24.56M | -19.01M | -17.12M | -7.12M | -1.68M |
| Net Interest Income | 8.73M | 14.83M | 11.4M | 4.37M | -1.31M | -31.59M | -27.44M | -16.62M | -7.35M | 429K | -209K | -3K | -492K | -499K | -228K | -76K |
| Interest Income | 12.75M | 20.24M | 16.34M | 10.1M | 5.36M | 1.48M | 1.21M | 3.67M | 2.81M | 553K | 358K | 280K | 65K | 6K | 4K | 7K |
| Interest Expense | 4.02M | 5.41M | 4.94M | 5.73M | 6.68M | 33.07M | 28.65M | 20.29M | 10.16M | 124K | 567K | 283K | 557K | 505K | 232K | 83K |
| Other Income/Expense | 6.85M | 9.09M | 11.4M | 24.23M | -1.31M | -33.11M | -36.37M | -32.65M | -7.35M | 429K | -209K | -3K | -492K | -499K | -228K | -76K |
| Pretax Income | 116.58M | 54.73M | -30.86M | -61.82M | -106.08M | -111.1M | -136.2M | -83.36M | -39.2M | -26.48M | -35.93M | -24.84M | -19.56M | -17.62M | -7.36M | -1.76M |
| Pretax Margin % | 13.4% | 6.89% | -4.43% | -9.9% | -18.75% | -22.28% | -33.82% | -26.42% | -16.26% | -13.65% | -23.92% | -22.82% | -24.72% | -30.98% | -17.9% | -6.53% |
| Income Tax | 6.42M | 2.72M | 7.68M | 3.56M | 2.91M | 1.64M | 1.42M | -12.49M | -3.8M | -314K | 427K | 220K | 71K | 55K | 164K | 132K |
| Effective Tax Rate % | 5.51% | 4.96% | -24.87% | -5.76% | -2.74% | -1.48% | -1.04% | 14.98% | 9.7% | 1.19% | -1.19% | -0.89% | -0.36% | -0.31% | -2.23% | -7.49% |
| Net Income | 110.16M | 52.01M | -38.54M | -65.38M | -108.98M | -112.75M | -137.62M | -70.88M | -35.4M | -26.16M | -36.35M | -25.06M | -19.63M | -17.88M | -8.78M | -3.03M |
| Net Margin % | 12.66% | 6.54% | -5.53% | -10.47% | -19.27% | -22.61% | -34.17% | -22.47% | -14.68% | -13.49% | -24.2% | -23.02% | -24.81% | -31.43% | -21.36% | -11.22% |
| Net Income Growth % | 247.19% | 234.96% | 41.06% | 40.01% | 3.34% | 18.07% | -94.17% | -100.23% | -35.29% | 28.03% | -45.05% | -27.65% | -9.84% | -103.61% | -190.02% | - |
| Net Income (Continuing) | 110.16M | 52.01M | -38.54M | -65.38M | -108.98M | -112.75M | -137.62M | -70.88M | -35.4M | -26.16M | -36.35M | -25.06M | -19.63M | -17.68M | -7.52M | -1.9M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 1.73 | 0.80 | -0.64 | -1.12 | -1.90 | -2.00 | -2.65 | -1.53 | -0.83 | -0.63 | -0.92 | -0.67 | -0.67 | -1.37 | -0.74 | -0.26 |
| EPS Growth % | 250.26% | 225% | 42.86% | 41.05% | 5% | 24.53% | -73.2% | -84.34% | -31.75% | 31.52% | -37.31% | 0% | 51.09% | -85.14% | -184.62% | - |
| EPS (Basic) | - | 0.84 | -0.64 | -1.12 | -1.90 | -2.00 | -2.65 | -1.53 | -0.83 | -0.63 | -0.92 | -0.67 | -0.67 | -1.37 | -0.77 | -0.26 |
| Diluted Shares Outstanding | 63.53M | 65.12M | 60.1M | 58.35M | 57.3M | 56.39M | 52.02M | 46.2M | 42.8M | 41.22M | 39.65M | 37.27M | 29.26M | 13.08M | 11.79M | 11.79M |
| Basic Shares Outstanding | 62.15M | 62.16M | 60.1M | 58.35M | 57.3M | 56.39M | 52.02M | 46.2M | 42.8M | 41.22M | 39.65M | 37.27M | 29.26M | 13.08M | 11.35M | 11.79M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
Quick answers to the most common questions about buying QTWO stock.
For fiscal year 2025, Q2 Holdings, Inc. (QTWO) reported total revenue of $794.8M. This represents a 2845.7% increase compared to $27.0M in 2011.
Q2 Holdings, Inc. (QTWO) is profitable, generating $52.0M in net income for the fiscal year ending 2025 with a net profit margin of 6.5%.
Q2 Holdings, Inc. (QTWO) reported an operating income of $45.6M, resulting in an operating profit margin of 5.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Q2 Holdings, Inc. (QTWO) generated $429.6M in gross profit for the year, representing a gross profit margin of 54.0%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Regional bank consolidation churn
Metrics are mathematically derived from official filings.
Revenue Growth Sustained Near Low-Teens
Based on reported figures, QTWO's quarterly revenue grew from $172.9M in 2024Q2 to $225.8M in 2026Q3, with year-over-year growth holding between roughly 11.9% and 15.2% across the most recent quarters, indicating durable demand rather than a one-off surge.
The growth rate has been remarkably steady rather than accelerating, which suggests the subscription base is compounding predictably. Because growth has not visibly stepped up despite the management guidance raise, investors should monitor whether the rate sustains as the company scales beyond the mid-$200 million quarterly range. The data alone does not isolate volume, pricing, or inorganic contribution, so the durability of this trajectory warrants further investigation.
Gross Margin Expansion Driven by Mix
As reported in financial statements, QTWO's gross margin improved from 50.2% in 2024Q2 to 59.7% in 2026Q3, a roughly 950 basis point expansion that appears to reflect a rising share of higher-margin subscription revenue over lower-margin services.
The gross margin trend is one of the clearest positive signals in the dataset, with the step-up appearing to occur gradually over the period. This expansion may indicate improving hosting efficiency or a shift in revenue mix, though the snapshot does not separate these drivers. Investors should monitor whether the 59-60% range holds, since further gains would depend on continued operating leverage in cloud infrastructure costs.
Operating Leverage Emerging After Breakeven
Based on QTWO's reported figures, operating income swung from a $13.7M loss in 2024Q2 to $34.0M in 2026Q3, with operating margin reaching 15.0%, suggesting gross profit gains are outpacing the relatively flat SG&A base.
SG&A has held roughly between $56M and $59M across the period while gross profit grew substantially, which is consistent with meaningful operating leverage. This pattern suggests the cost base is not scaling proportionally with revenue, a key ingredient for sustained margin improvement. Whether this leverage persists depends on whether R&D and SG&A remain disciplined as the company pursues growth initiatives.
Net Income Lags Stock Compensation Burden
According to recent SEC filings, QTWO reported net income of $33.2M in 2026Q3 on $225.8M revenue, yet stock-based compensation of $20.0M per quarter remains a substantial share of operating earnings, warranting closer scrutiny of reported profitability.
Stock-based compensation consumes a material fraction of the operating income generated in recent quarters, which means the GAAP earnings figures carry a meaningful non-cash cost that some analysts would treat as a real expense. The gap between operating and net income appears modest in recent periods, but the reliance on equity compensation may indicate a continuing need to attract talent. Investors should monitor whether SBC intensity declines as margins mature.
Margin Gains Could Prove Less Durable
Based on reported figures, QTWO's 15.0% operating margin remains well below mature software peers, and the recent margin inflection may not survive increased compliance costs or a talent-driven rise in R&D spending.
Short-sellers would likely argue that the recent margin expansion reflects temporary cost timing rather than structural change, particularly given the company's history of losses through 2024. Heightened BaaS regulatory scrutiny could require unplanned compliance spending that compresses margins. The data does not confirm these risks materialized, but they warrant further investigation before assuming the margin trajectory is secure.