In a time when organizations are facing mounting challenges in securing their digital assets and complying with evolving regulations, cloud-based solutions have emerged as a linchpin for operational efficiency and security.
At the forefront of this crucial transformation is Qualys, which has established itself as a trusted provider specializing in a comprehensive range of cloud-based IT, security, and compliance offerings.
Qualys serves a diverse customer base that spans various industry sectors, from education and healthcare to manufacturing and retail. Enterprises, government bodies, and small to medium-sized businesses alike rely on Qualys for a multitude of use cases, be it safeguarding their digital infrastructure, ensuring regulatory compliance, or securing customer data.
Currently, the company is on an aggressive growth trajectory, investing heavily in research and development, and launching new products to expand its cloud platform. They are also focusing on continuously adding new features and growing their sales and marketing teams to help leverage their existing customer base of over 10,000 clients to further adopt more services. Qualys is also reaching out to new customers globally, partnering with other companies in the security industry to help get their products into new markets.
Recent acquisitions are extending the company’s capabilities with AI-based deep learning to discover and identify relationships and patterns which enable organizations to rapidly predict, detect, prioritize, and remediate activity that would normally be undetectable in traditional cloud solutions.
With this combination of innovation, customer relationship expansion, strategic partnerships, and tactical acquisitions, Qualys continues to solidify its place in cloud-based IT solutions.
Founded in 1999, Qualys initially focused on addressing the growing need for automated detection of network vulnerabilities. The company was among the pioneers in the SaaS security sector. Launching its flagship product, QualysGuard, in 2000, this software automatically scanned corporate local area networks for vulnerabilities and provided patch solutions, positioning Qualys as one of the first entrants in the vulnerability management market. Over time, the company expanded its product suite to include compliance checks, malware detection, and web application scanning.
Soon after Qualys went public on the Nasdaq in 2012, when it raised $87.5 million, the company launched its Cloud Platform. This was a transformative step that gave organizations the ability to audit and protect their IT assets in real time, whether they were located on-premises, in the cloud, or mobile.
Over two decades in the industry, Qualys has garnered strategic partnerships with top cloud providers, including Amazon Web Services, Microsoft Azure, and Google Cloud Platform. Additionally, it has collaborated with managed service providers and consulting organizations such as Accenture, BT, and IBM. Qualys is also a founding member of the Cloud Security Alliance, cementing its position as a thought leader in the industry.
Company veteran, Sumedh Thakar, serves as the President and CEO of Qualys. With a strong background in coding and a passion for cybersecurity, Thakar joined Qualys in 2003. Rising from an engineer to his current roles he is considered a “product fanatic” and has been instrumental in dramatically expanding the original platform’s scope, integrations, and automations. He also scaled the company’s engineering talent internationally with a global 24×7 “follow-the-sun” product team. In addition, he is a co-inventor of five U.S. patents for cybersecurity technology in Qualys’ offerings.
Joining Thakar, Pinkesh Shah is Qualys’ chief product officer with a broad range of responsibilities, overseeing Product Management, Product & UX Design, and various marketing functions. Under his guidance, Qualys has continued to evolve its product offerings, keeping pace with the changing demands and complexities of cybersecurity. Pinkesh has deep cybersecurity expertise and has led product, engineering, and marketing teams at companies including McAfee, BeyondTrust, Exabeam, netIQ, and IBM, among others.
Qualys offers a comprehensive cloud platform that is focused on IT security, compliance, and asset management. This suite of services, known as Qualys Cloud Apps, is designed to eliminate the need for multiple fragmented security tools, offering businesses a one-stop solution for all their needs. One of the standout features is the platform’s unified approach. Everything from web application to cloud security and compliance reporting can be managed centrally, saving time and reducing the complexity often associated with multiple, disparate IT security solutions.
Moreover, the platform provides real-time visibility and control over an organization’s security landscape. Physical and virtual sensors, coupled with cloud agents, ensure that businesses have an immediate and continuous view of their security posture. This is especially crucial for enabling quick and timely responses to any emerging threats.
Core services allow for easy asset tagging and management, enabling businesses to keep a well-organized inventory of all their IT assets. Reporting and dashboards are highly customizable, offering reports based on roles and different levels of access. While for remediation and workflow, Qualys helps automate the process of identifying and fixing vulnerabilities, making it easier for IT teams to maintain a secure environment.
In addition, the platform also employs Elasticsearch, enabling the big data correlation and analytics engine to offer instant search capabilities across large volumes of security and compliance data. Alerts and notifications keep teams constantly informed about new vulnerabilities, updates, or any significant changes to the security landscape.
Ensuring flexibility in deployment is another distinct advantage for Qualys, as customers have the option of using the cloud platform either through one of their 11 globally shared platforms or through a more customized, private platform. This makes the solution both scalable and cost-effective, whilst providing the flexibility to meet the specific needs and requirements of different organizations.
The versatility of the platform also makes it possible to cater to a wide range of organizations. Large enterprises often opt for Qualys for its robust and comprehensive features that are scaled to meet their expansive needs. Medium-sized businesses frequently use the Express edition of Qualys Cloud Apps, which is tailored to fit their specific scope and requirements. While for small businesses, the platform offers lighter versions that are ideal for companies with limited IT resources. Consultants and Managed Service Providers are also catered for with the Consulting Edition, which is specifically tailored for those who need to manage the security and compliance requirements of multiple clients.
In the real world, healthcare institutions might rely on Qualys to ensure compliance with HIPAA regulations with the platform identifying vulnerabilities in their network and offering remediation steps to fix them before they can be exploited. Retailers, especially those handling sensitive customer data, can use Qualys to conform with PCI DSS regulations, thereby avoiding hefty fines and potential loss of reputation. While software companies can benefit by leveraging the web application security features of the platform to protect their apps from common vulnerabilities like SQL injection and cross-site scripting.
In today’s digital age, where security threats are omnipresent, Qualys has carved a niche for itself as a leader in cybersecurity risk management, offering businesses a central, cloud-based platform for securing their operations. The platform provides real-time global insights into companies’ security and compliance, eliminating the need for expensive and complicated in-house solutions. Qualys’ focus is especially relevant as businesses increasingly look for outsourced cloud solutions to manage their IT security.
With a massive and expanding potential market across VM & Assessment, Compliance, IT Asset Management, Cloud Security, Endpoint Security, Security Analytics & Orchestration, Qualys is well-positioned to capitalize on numerous growth opportunities. Ongoing investment in product innovation and strategic partnerships is solidifying its position as a future-proof solution in an ever-evolving industry.
Qualys continues to evolve its product offerings to meet market demands, most recently releasing TotalCloud, designed to protect cloud-native applications. The company is also leveraging artificial intelligence and deep learning technologies to constantly improve the platform’s ability to predict vulnerabilities before they become major issues, whilst tailoring its approach to what customers actually need.
Partnerships have played a key role in the company’s strategy for growth. In particular, its maturing relationship with Amazon Web Services has allowed Qualys to integrate its services with other platforms and offer more comprehensive solutions. The company has also enhanced its capabilities through strategic acquisitions. The latest of which saw the assets of Blue Hexagon Inc. acquired in 2022. This addition further integrated machine learning into the platform, and has ultimately delivered an expansion of Qualys’ range of services and market share.
The strategies are yielding tangible results, with the company continuing to secure significant new and expanding contracts. In its latest quarter, it helped a Fortune 300 manufacturing firm solve a major security crisis, deploying a solution to over 40,000 assets in minimal time. They also expanded their engagement with a Forbes 1000 food manufacturer, offering them a more robust security package where fast remediation on a single console and consolidating agents on an integrated platform were all key differentiators in making Qualys the platform of choice.
For more than a decade, Qualys has delivered an impressive run of solid double-digit year-over-year revenue growth, culminating just short of half a billion dollars in 2022, after it rose 19% to close out the year at $489.7 million. The company is seamlessly carrying this momentum into the first half of 2023, as reported revenues hit $267.9 million for the first six months of the year This represented a $34.6 million or 13% increase, largely fueled by a 92% contribution from existing customers. This bump in revenue was mostly driven by U.S. customers, although a solid 36% came from international clients, while also being equally split between direct contracts versus third-party partners.
Despite the commensurate increase in both costs of revenue and operational expenses including research and development, and sales and marketing, as a result of ongoing investment in scaling the business, Qualys’ gross profit margin for the last 12 months sits at an impressive 80%, blitzing the sector median by almost 62%. These strong numbers have led to the company reporting a net income of $64.5 million for the first half of 2023, a solid 24% improvement on the prior comparative half.
Looking ahead, management is projecting total revenues to be in the range of $553.0 to $555.0 million, representing 13% growth year-over-year compared to 2022, in line with consensus expectations. Analysts are also expecting full year’s earnings per share to improve by 23% to $4.60, up from $3.72 in 2022.
Qualys operates in a highly competitive and fragmented market that focuses on IT, security, and compliance solutions. The company faces a mix of competitors, ranging from well-established firms like Broadcom (Symantec), CrowdStrike, and Palo Alto Networks to emerging private players like Axonius, Checkmarx, and Flexera, among others. In addition, Qualys also competes with in-house solutions that organizations may have developed internally.
While these competitors will attempt to further expand their presence in the market and compete more directly against Qualys solutions, the company continues to extend its cloud platform’s functionality. It is achieving this by further developing key competitive factors such as breadth of offerings, flexibility of delivery models, ease of scalability, deployment, and usage, in addition to total cost of ownership.
In a sector that is both complex and rapidly evolving, Qualys’ scalable and adaptive solutions provide it with a compelling competitive advantage. Its focus on innovation, strategic partnerships, and a diversified product suite positions the company well for continued revenue and profitability growth.