Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at nCino (NASDAQ: NCNO) and its peers.

Software is eating the world, and while a large number of solutions such as project management or video conferencing software can be useful to a wide array of industries, some have very specific needs. As a result, vertical software, which addresses industry-specific workflows, is growing and fueled by the pressures to improve productivity, whether it be for a life sciences, education, or banking company.

The 14 vertical software stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.1% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

nCino (NASDAQ: NCNO)

Born from the internal technology needs of a community bank in 2011, nCino (NASDAQ: NCNO) provides cloud-based software that helps financial institutions streamline client onboarding, loan origination, and account opening processes.

nCino reported revenues of $148.8 million, up 12.4% year on year. This print exceeded analysts’ expectations by 3.9%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.

"We are pleased to report financial results that again exceeded quarterly guidance for total and subscription revenues, as well as non-GAAP operating income," said Sean Desmond, CEO at nCino.

The stock is down 2.1% since reporting and currently trades at $28.08.

Is now the time to buy nCino? Access our full analysis of the earnings results here, it’s free.

Best Q2: Upstart (NASDAQ: UPST)

Using over 2,500 data variables and trained on nearly 82 million repayment events, Upstart (NASDAQ: UPST) is an AI-powered lending platform that uses machine learning to help banks and credit unions more accurately assess borrower risk for personal loans, auto loans, and home equity lines of credit.

Upstart reported revenues of $257.3 million, up 102% year on year, outperforming analysts’ expectations by 13.6%. The business had an exceptional quarter with EBITDA guidance for next quarter exceeding analysts’ expectations.

Upstart delivered the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise among its peers. The market seems unhappy with the results as the stock is down 30.6% since reporting. It currently trades at $57.35.

Is now the time to buy Upstart? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Agilysys (NASDAQ: AGYS)

With a tech stack that powers everything from check-in to checkout at some of the world's top hospitality venues, Agilysys (NASDAQ: AGYS) develops and provides cloud-based and on-premise software solutions for hotels, resorts, casinos, and restaurants to manage operations and enhance guest experiences.

Agilysys reported revenues of $76.68 million, up 20.7% year on year, exceeding analysts’ expectations by 3.1%. Still, it was a slower quarter as it posted a significant miss of analysts’ EBITDA estimates.

Agilysys delivered the weakest full-year guidance update in the group. As expected, the stock is down 10.4% since the results and currently trades at $105.

Read our full analysis of Agilysys’s results here.

Q2 Holdings (NYSE: QTWO)

With a platform powering digital services for approximately 25 million account holders across America, Q2 Holdings (NYSE: QTWO) provides cloud-based digital solutions that help financial institutions, fintechs, and alternative finance companies deliver modern banking experiences to their customers.

Q2 Holdings reported revenues of $195.1 million, up 12.9% year on year. This print surpassed analysts’ expectations by 0.8%. It was an exceptional quarter as it also logged an impressive beat of analysts’ annual recurring revenue and billings estimates.

Q2 Holdings had the weakest performance against analyst estimates among its peers. The stock is down 18.3% since reporting and currently trades at $73.66.

Read our full, actionable report on Q2 Holdings here, it’s free.

PTC (NASDAQ: PTC)

Originally known as Parametric Technology Corporation until its 2013 rebranding, PTC (NASDAQ: PTC) provides software that helps manufacturers design, develop, and service physical products through digital solutions for CAD, PLM, ALM, and SLM.

PTC reported revenues of $643.9 million, up 24.2% year on year. This number topped analysts’ expectations by 10.4%. Overall, it was an exceptional quarter as it also put up EPS guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EBITDA estimates.

The stock is flat since reporting and currently trades at $201.98.

Read our full, actionable report on PTC here, it’s free.

Market Update

Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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