Q2 (QTWO) Citi's 14th Annual FinTech Conference summary

Market positioning and competitive differentiation

• Operates as the largest standalone digital banking provider, serving 450 clients and 40% of the top 100 banks and credit unions.

• Single unified platform enables seamless scaling from retail to corporate banking, enhancing customer retention and operational efficiency.

• Platform leverages behavioral, transactional, and demographic data for AI and machine learning applications.

• Targets banks and credit unions above $750 million in assets, with significant cross-sell opportunities among existing clients.

• Innovation Studio marketplace integrates over 200 fintechs, supporting bundled offerings and relationship pricing tools.

Revenue composition and growth drivers

• Subscription revenue comprises 82% of total, with digital banking representing just over 80% of revenue.

• Precision Lender, Helix, and Symphonics businesses contribute mid to high teens percentage of revenue.

• Growth is increasingly driven by cross-selling to existing customers, with expansion deals now outpacing new logo wins in some quarters.

• Large existing clients are expanding into new product lines, creating significant economic impact.

Macro environment and industry trends

• Post-pandemic digital adoption exposed legacy tech weaknesses, driving demand for modern platforms.

• Rising interest rates and deposit flight have made deposit retention and commercial account functionality critical.

• Bank consolidation has minimal negative impact; retention rate as the surviving platform in M&A events is over 90%.

• Demand remains strong regardless of rate direction, with commercial functionality and platform efficiency as key tailwinds.