On May 19, 2025, Agilysys Inc (AGYS, Financial) released its 8-K filing reporting record revenue for the fiscal 2025 fourth quarter and full year. The company, a leader in hospitality software solutions, achieved a total net revenue of $74.3 million for the fourth quarter, surpassing the analyst estimate of $71.42 million. This represents a 19.4% increase from the previous year's fourth quarter revenue of $62.2 million.
Company Overview
Agilysys Inc has established itself as a prominent provider of innovative cloud-native SaaS and on-premise solutions tailored for the hospitality industry. The company's offerings include point-of-sale (POS), property management (PMS), inventory and procurement, payments, and related applications designed to enhance the guest experience across various sectors such as hotels, resorts, casinos, and more.
Performance and Challenges
Agilysys Inc's fiscal 2025 performance was marked by significant achievements, including a 42.7% year-over-year increase in subscription revenue for the fourth quarter. However, the company faced challenges with a slight decrease in gross margin to 60.7% from 61.5% in the previous year. Despite these challenges, the company's ability to maintain strong revenue growth is crucial for sustaining its competitive edge in the software industry.
Financial Achievements
The company's financial achievements for fiscal 2025 include a record annual revenue of $275.6 million, exceeding the estimated $272.80 million. Recurring revenue reached $170.1 million, accounting for 61.7% of total net revenue, with subscription revenue growing by 39.5% year-over-year. These achievements underscore Agilysys Inc's successful transition to a subscription-based model, which is vital for long-term growth in the software industry.
Key Financial Metrics
Agilysys Inc reported a net income attributable to common shareholders of $3.9 million, or $0.14 per diluted share, for the fourth quarter, surpassing the estimated earnings per share of $0.12. The company's adjusted EBITDA for the quarter was $14.8 million, up from $11.0 million in the prior-year period. Free cash flow for the quarter was $26.5 million, although this was a decrease from $29.3 million in the previous year.
| Metric | Q4 2025 | Q4 2024 | FY 2025 | FY 2024 |
|---|---|---|---|---|
| Total Net Revenue | $74.3M | $62.2M | $275.6M | $237.5M |
| Net Income | $3.9M | $3.0M | $23.2M | $85.0M |
| Adjusted EBITDA | $14.8M | $11.0M | $53.8M | $37.1M |
| Free Cash Flow | $26.5M | $29.3M | $52.3M | $40.1M |
Analysis and Future Outlook
Agilysys Inc's strong performance in fiscal 2025 highlights its successful strategy in expanding its subscription revenue and maintaining robust growth in the hospitality software market. The company's focus on cloud-native solutions and customer-centric services has positioned it well for future growth. Looking ahead, Agilysys Inc expects fiscal 2026 revenue to range between $308 million and $312 million, with a 25% increase in subscription revenue and an adjusted EBITDA of 20% of revenue.
Ramesh Srinivasan, President and CEO of Agilysys, stated, “We are pleased with our fourth quarter results, which featured year-over-year subscription revenue growth of 42.7% including Book4Time and services revenue growth of 21.7%, producing the 13th consecutive record quarter for overall revenue.”
Agilysys Inc's ability to navigate operational challenges and capitalize on market opportunities will be crucial in achieving its fiscal 2026 targets and sustaining its growth trajectory in the competitive software industry.
Explore the complete 8-K earnings release (here) from Agilysys Inc for further details.
