New Thread

Ctrl

⇧

Discover

Home

Discover

Agilysys, Inc. Stock Price: Quote, Forecast, Splits & News (AGYS)

Finance

Company Profile

New

Agilysys, Inc. Price & Performance (AGYS)

Stock Performance

Updated Mar 18, 7:54 PM UTC

AGYS:NASDAQ

$75.60USD

0.92% · $0.69

Open

$74.00

High

$75.73

Low

$73.70

Market Cap

$2.11B

P/E Ratio

100.8

Volume

155.41K

Year High

$142.64

Year Low

$71.37

News & Market Insights

Agilysys Receives Prestigious ISPA Innovate Award for Spa Software
Mar 4, 2025
Agilysys has been recognized with the 2024 ISPA Innovate Award for its Book4Time spa software solution. The award highlights the RevStream Analytics feature, which delivers real-time multi-location performance tracking for spas. This innovation is expected to enhance profitability and operational efficiency across the hospitality industry.12
Director John Mutch Sells Agilysys Stock Amid Market Challenges
Mar 10, 2025
John Mutch, a director at Agilysys, sold 2,000 shares for $155,740 as the company’s stock trades near its 52-week low. Despite the dip, Agilysys has shown strong subscription revenue growth, a key factor analysts believe will drive recovery in the hospitality software market.34
Agilysys Faces Stock Decline Despite Robust Subscription Growth
Mar 10, 2025
Agilysys stock has hit a 52-week low of $73.93, reflecting a challenging market environment. While overall revenue fell short of expectations, subscription revenue surged over 45% year-over-year, signaling potential resilience in the company’s business model amid shifting market dynamics.42

What's Happening

Peers

Earnings

Report Date

Jan 21, 2025

Reported Revenue

69.6M

Avg 1d Change

11.88%

Report Period

Q3 2025

Reported EPS

0.27

Implied Move 1d

11.74%

Transcript

11m 5s

Thank you for joining the Agilisys 2025 Third Quarter Conference Call.

11m 9s

We will get started in just a minute with management's comments but before doing so, let me read the Safe Harbor language. Some statements made on today's call will be predictive and are intended be made as forward looking within the Safe Harbor protections of the Private Securities Litigation Reform Act of 1995. Including statements regarding our financial guidance. Although the company believes that its forward looking statements are based on reasonable assumptions, Such statements are subject to risks and uncertainties that could cause actual results to differ materially. Important factors that could cause actual results to vary materially from these forward looking statements include our ability to meet the provided guidance levels our ability to increase sales, our ability to maintain profitability levels, and the risks set forth in the company's reports on Form 10 ks and 10 Qs and other reports filed with the Securities and Exchange Commission. As a reminder, any references to record financial and business levels during this call refer only to the time period after Agilisys made the transformation an entirely hospitality focused software solutions company in fiscal year 2014.

12m 22s

With that, I'd now like to turn the call over to Mr. Ramesh Srini Vassan, President and CEO of Agilisys. Ramesh, please go ahead. Good evening.

12m 32s

Welcome to the fiscal 2025 Q3 earnings call.

12m 36s

Joining Jess and me on the call today at our Atlanta headquarters is Dave Wood, CFO. As is our usual practice in these calls, let me cover sales first before discussing revenue and other details. We measure sales or selling success in annual contract value terms. Fiscal 2025 Q3 was our 3rd highest sales quarter ever. Slightly below the sequentially preceding Q2 which was the 2nd highest. Just like how the previous quarter was our best ever July to September sales period, this one was the best ever October to December [indiscernible] Fiscal 2025 Q3 October to December was a successful sales quarter despite point of sale POS sales coming in below expectations. Sales of POS and POS related products during Q3 was better than Q1 but less than Q2. Fiscal 2025 sales and revenue levels [indiscernible] well short of our expectations mainly due to disappointing POS sales levels in the managed food services vertical. The very tough process of cross the technology old to new transformation bridge turned out to be a lot more challenging with POS than we bargained for We are currently working on several significant near term POS sales opportunities. We remain confident we will get past this current challenging phase soon. [indiscernible] We expect POS sales to return to normal levels during the next few quarters and then improve further on from there.

14m 32s

With the exception of installations for 1 customer, who has not approved the newer versions for their properties yet, Virtually, all our current POS implementations involve only the combined, modernized and unified new versions and are going very well. As we move into the new calendar year, many customers are coming back to the table for conversations on moving from old to new versions [indiscernible] have had the time to plan and budget for these upgrades. On the other hand, Q3 was the all time best quarter for sales of property management systems, PMS, and PMS related add on modules, even excluding sales pertaining to Book for Time. Sales of PMS and related modules excluding Book for Time, measured in annual contract value terms, was 70%, that is 70 70% higher than sales during the comparable prior year quarter. None of any PMA sales reported so far includes anything from the Marriott PMS agreement. With one full quarter left to go, fiscal 2025 is already our record best sales year for PMS and related modules [indiscernible] of the previous best full year by as much as 33%. The transformation process from old to new modernized cloud native technology has proven to be a lot more straightforward and simpler to manage With respect to PMS, compared to POS.

16m 25s

Fiscal 2025 Q3 was another excellent sales quarter for U. S. Domestic sales including the gamingcasinos vertical. With the turnaround beginning to happen, in the managed food services vertical, Sales levels in the APAC and EMEA regions remained at about the same disappointing levels as before. However, we are currently working on several substantial sales opportunities in both these international regions and it will not surprise us if this current January to March Q4 quarter is a record one, international sales. We are continuing to build our brand reputation and a base of good solid referenceable customers in international regions and are making slow but steady progress. More opportunities will come as we make progress with these efforts. Despite ongoing challenges with POS and international sales, Overall global sales at the end of the 1st three quarters of fiscal 2025 April to December was well ahead of last year's record pace through 3 quarters and we continue to see sales momentum as we move into the final quarter, of the fiscal year. During fiscal 2025 Q3 October to December, we added 12 new customers, and 11 of them were fully subscription based. These new customers signed up for an average of [indiscernible] Which is a record high.

18m 2s

In addition, we added 76 new properties which did not have any of our products before but the parent company was already our customer. Of the 88 new properties added during the quarter, across new customers, and new properties of current parent customers [indiscernible] were either partially or fully subscription based. With respect to new product sales, there were 86 instances of sales to properties which have at least one of our other products already in use. These 86 instances involve sales of a total of 204 new products. With 1 quarter remaining in the year, fiscal 2025 is already the best full year in our history for new product sales. Customers using at least one of our products continue to trust us. Buying additional products at a record pace. We continue to work hard to translate that success we are having with customers who know us well to new customers who have not known us well before, and are only now becoming more familiar with our recent history of product innovation. Like we said in our last earnings call, much of the hospitality industry is not fully discovered the new Agilisys yet. We have a long promising runway of short and medium term sales and revenue growth ahead of us. [indiscernible] both with the existing customer base and with new customers.

19m 40s

Our current global demo plus sales pipeline measured at the annual contract value sum Of all sales opportunities we are currently working on, which have reached at least the product demonstration stage, is now at a record level since we started tracking this value a couple of years ago. And was 20% higher as of December end compared to the same time, the previous year. This demo plus sales pipeline was 22% and 37% higher for POS and PMS opportunities respectively as of December end, compared to the same time, 1 year ago. Our sales momentum remains strong but it can be even stronger. Our installations are getting better but we should be doing a lot more of them. Our number of new customers is good, but can be far higher. These are the areas we are focused on as we move into the final quarter of this year. And continue our work on growth plans, for the next fiscal year. On to revenue and profitability. Fiscal 2025 Q3 revenue was a record $69,600,000 The 12th consecutive record revenue quarter 14.9 percent, that is 1.4 14.9% higher than the comparable prior year quarter. Product revenue was $10,700,000 which was 15.8% that is one size. 15.8% [indiscernible] than Q3 last year.

21m 27s

Product revenue continues to be challenged due to 3 main factors. 1, an increasing proportion of business expansion is now based on the cloud involving subscription licenses. Perpetual software license revenue, which forms a portion of product revenue, is not expected to be one of our future growth engines. Factor number 2, the hardware portion of product revenue is dependent on POS sales which has been challenged in the recent past. And factor number 3, each unit of POS sales now has a reduced hardware attach rate because the recent software versions of our POS terminal support all major operating systems, Windows, iOS and Android, and not through us. While we expect POS sales levels to improve in the near term, we expect product revenue levels to remain challenged for the foreseeable future. [indiscernible] was $14,500,000 14 14,500,000 13.5 percent that is 13.5% higher than the comparable prior year quarter but below our expectations and back to more realistic levels. Services revenue and margin this quarter was affected by 3 reasons. 1, billable PMS product enhancement development work for the major project we've been working on for several quarters has been substantially completed as that project now moves into the deployment planning phase, Reason number 2, a few significant implementation projects were postponed by customers.

23m 20s

During December to subsequent months a larger extent compared to previous December months. And reason number 3, was our inability to meet our hiring goals during the past few months. As we continue to expand the size and strength of the implementation services streams, Services backlog is now at a record high level and we expect services revenue to grow along a more realistic path for the foreseeable future. We are currently working on ways to increase the hiring pace for the services teams. Fiscal 2025q3 recurring revenue was a record $44,400,000 26.4% higher than the comparable prior year period. The year over year increase in recurring revenue of 9,300,000 dollars is a record high. Recurring revenue was 63.8 percent of total revenue this quarter. Within recurring revenue, subscription revenue was a record 28,300,000 dollars 45.1 percent higher than the comparable prior year quarter. This was the 6th consecutive quarter of such of at least 29%. Organic subscription revenue year over year growth was 23%. The overall subscription revenue year over year increase was a record $8,800,000 Subscription revenue. Is now 63.8 percent of total recurring revenue which is the highest level reached till now.

25m 5s

Subscription revenue pertaining to point of sale POS and POS related modules, grew by close to 20% year over year while subscription revenue pertaining to PMS and PMS related modules [indiscernible] grew by 35% year over year. [indiscernible] PMS related subscription revenue grew during the 1st 3 quarters of fiscal 2025 by a lot more than the sum of the growth during all of the previous full fiscal year. Removing book for time subscription revenue from only add on modules, across both POS and PMS most of which were created during the recent past several years. Constituted 22% of total subscription revenue. Including book for time in the equation, add on modules are now 34% of total subscription revenue. Over the past several years, our product development teams have done a masterful job of completing the extremely onerous and difficult product modernization projects achieving a near 100% success rate. With each and new module creation effort. This kind of success rate is not often seen with such massive reengineering exercises in the enterprise software world. All recent installations which are based only on the modernized versions are going very well. The transformation from old to new had to be done in stages for the POS products and became more challenging than we expected.

26m 55s

We underestimated related sales challenges this fiscal year. Most of the top line revenue headwinds we have faced this fiscal year are related to these POS sales challenges mainly in the managed food services vertical. We now expect full fiscal year 2025 total revenue. We to be $273,000,000 We expect to achieve the previously provided guidance for profitability levels and subscription revenue growth. Before handing the call over to Dave, for more on our financial results, a quick update on the Marriott PMS project. As we mentioned earlier in the call, We have now moved past the initial significant development phase of the project. All vendors are working collaboratively towards the next phase and there is a high degree of transparency regarding all project details among all involved parties, This includes detailed end to end ecosystem and system performance testing across all vendors and preparing for a few test properties which will be followed by pilot property installations expected in the second half of this calendar year. With that, let me hand over the call to base. Thank you, Ramesh.

28m 28s

Taking a look at our financial results beginning with the income statement. 3rd quarter fiscal 2025 revenue was a quarterly record of $69,600,000 a 14.9% increase from total net revenue of $60,600,000 in the comparable prior year period. Onetime revenue consisting of product and professional services was down 1.1% compared to the prior [indiscernible] While recurring revenue was up 26.4%. We continue to work through challenges of transforming the new versions [indiscernible] We are also seeing revenue impact this quarter as we move beyond the development [indiscernible] and start planning for the rollout of a major customer. However, our sales momentum remains strong with Q3 bookings at healthy levels for future revenue growth. Our total backlog remains at near record levels will continue to be the biggest headwind in the business through the 4th quarter. The full fiscal year product revenue will be 15% to 20% down compared to the last fiscal year. A larger year over year reduction than we originally expected. Although short of expectations, point of sale bookings are still up over the low point in Q1 of fiscal year 'twenty 5. Professional services increased 13.5 dollars with services gross margin at 26.7 percent. Professional services reduced by $1,800,000 when compared to Q2 fiscal year 'twenty 5.

30m 8s

The drop was largely related to the large development effort we've been working on during the past couple of years. We have now wrapped up the majority of the initial development requirements. We are moving past the major development phase and shifting our focus to the rollout phase the project We will continue to see some development services related revenue associated with the large project but at a significantly reduced level bringing services revenue more in line with normal growth rates. Typical professional services projects also caused some revenue impact during Q3. Where the timing of holidays caused several large projects to delay into the 4th quarter more than in prior years. Professional services backlog once again increased to record levels.

30m 56s

Total recurring revenue represented 63.8 percent of total net revenue for the fiscal 3rd quarter, compared to 58% in the Q3 of fiscal 2024.

31m 8s

Fiscal 2025 third quarter subscription revenue grew 45.1 percent over Q3 last fiscal year. Subscription revenue comprised 63.8 percent of total recurring [indiscernible] of total recurring revenue in the Q3 of fiscal 2024. Subscription revenue increased sequentially $3,300,000 from the Q2 of fiscal 2025. Organic subscription growth was 23% for the quarter and trending to 25% for the full fiscal year. Q3 was the best subscription sales quarter in our history. The subscription backlog continues to increase over our fiscal year 24 exit rates. Moving down the income statement, gross profit was 43,900,000 dollars compared to 37,800,000 in the comparable prior year quarter. Gross profit margin was 63% compared to 62.5% in the Q3 of fiscal 2024. Overall, total gross margin should remain just north of 60% Combined, the 3 main the 3 main operating expense line items were 42.1 percent of revenue in the fiscal 20253rd quarter compared to 43.1 percent of revenue in the [indiscernible] Excluding stock based compensation, product development decreased to 18.2 percent of revenue during Q3 of fiscal [indiscernible] compared to 20.9 percent of revenue in the comparable prior fiscal year Q3. General and administrative expense in the comparable prior fiscal year while sales and marketing increased from 9.8 percent of revenue to 12.2% of revenue.

33m 9s

Operating income for the Q3 of 7,400,000 dollars net income of 3 point $8,000,000 and gain per diluted share of $0.14 compared to the prior year Q3 gain of 7,800,000 dollars 76,900,000 and $2.85 The reduction in net income was primarily primarily due to the release of a $65,000,000 valuation allowance in the prior year quarter. Adjusted net income normalizing for certain non cash and non recurring charges of $10,700,000 and adjusted diluted earnings per share of $0.38 were both improvements over the prior year Q3 result of $9,300,000 $0.35 respectively. For the 2025 third quarter adjusted was $14,700,000 compared to $11,800,000 in the year ago quarter. We are pleased to see our profitability levels being well ahead of the original FY 'twenty five plan with adjusted EBITDA coming in at 21.2 percent of revenue. Moving to the balance sheet and cash flow statements. Cash and marketable securities as of December 31, 2024, was $60,800,000 compared to $144,900,000 as of March 31, 2024. The cash decrease was related to the portion of the Book For Time acquisition As a reminder, we also utilized $50,000,000 through our credit revolver to fund the Book For Time acquisition. As of fiscal Q3 end, we have paid down $12,000,000 of the associated debt.

34m 43s

Subsequent to December 31, 2024, we paid down an additional $14,000,000 Free cash flow in the quarter was $19,700,000 compared to $11,300,000 in the comparable prior year quarter. For the 1st 9 months of fiscal year 2025, free cash flow was $25,900,000 compared to $10,700,000 in the prior year. As we've said in the past, adjusted EBITDA and free cash flow continue to be good proxies for health of the business over the course of the fiscal year. Onetime revenue challenges have led us to lower our annual guidance to 273,000,000 dollars though subscription growth remains at least 38%. Despite this, profitability is above plan due to lower costs associated with reduced revenue expectations. In closing, our Q3 fiscal year 2025 financial results reflect some short term challenges, but affirm the solid foundation for current and future revenue growth. With that, I will now turn the call back over to Ramesh.

35m 49s

Thank you, Dave. In summary, let me reiterate that the top line revenue related headwinds we have faced this fiscal year are only related to the tough transition phase we are in now As we leave behind older technologies we were dependent on for a couple of decades, and have entered a new era of cloud native modernized technologies using which we have created an integrated set of a unified ecosystem of hospitality focused software modules which have given us a distinct and tough to duplicate competitive advantage. Fiscal 2025 was a in that massive transition, and we underestimated the sales challenges on the point of sale POS side of the equation. We should keep in mind that fiscal 2025 is still a record sales year for us. But could have been a lot better. In addition, we could have also done a lot better with the speed of hiring for the implementation services teams. We are focused on that now and expect professional services revenue to return to more realistic growth levels moving forward.

37m 10s

We cannot blame these challenges on any other significant reason. There are no external headwinds that have caused these challenges. No macroeconomic issues, no changes in the competitive environment, No structural issues Our business fundamentals are stronger now than ever before. Nothing that will require us to rethink any of our ongoing business and growth investment strategies. None of any of that. Our profitability levels are good and can be improved further as our operating leverage continues to be steadily more effective over the medium and long term. We have not sacrificed any growth related needs. To fuel profitability. The total addressable market size remains huge. We are now a credible presence in the PMS Property Management Systems arena where our growth journey is only getting started. We remain confident in our ability to run a world class enterprise software disciplined growth organization which knows how to balance growth and profitability. The major PMS project we've been working on continues to progress well. We are working through this transition phase and are in a good position to thrive and grow. We underestimated some of the short term old to new transition challenges this fiscal year. That is it. Nothing more.

38m 43s

And nothing less. The newer modernized unified versions of our product sets are doing well in the field. They are easier to implement [indiscernible] and enhance. They give us excellent reasons to be very bullish about our future for our employees, customers, and shareholders.

39m 6s

With that to end, let's open up the call for questions. Thank you.

39m 27s

Our first question comes from the line of George Sutton with Craig Hallum. Your line is open.

39m 36s

Thank you. Ramesh, I wondered if you could just walk through this development process that you talk about that we're now going to be in with our major project what is it tell us about the overall project?

39m 52s

Have there been any scope changes I believe we were pursuing a train the trainer model, which would suggest at some point we have less services component to this. But if you could just give us a little sense of that and then also you mentioned that there will be a few test properties then a pilot base. Can you just give us a little more detail on the significance of those [indiscernible] Yes. George, the good news about this project is there are no major changes from what we have been telling you all this time. Given how big a project is it, It is with a major customer. It's a massive transformational project for them. That involves multiple vendors.

40m 37s

And considering all the moving parts it has gone remarkably well so far and almost exactly on plan. There was a lot of development needs product development needs that needed to get done which are all substantially over now We are now moving into the ecosystem system performance testing and deployment planning phases. Which is exactly what where we thought we would be at this time. [indiscernible] what we expect in the second half of this year is [indiscernible] Followed by pilot sites to go live in the second half of calendar twenty twenty five, and then we proceed from there. So all that is going exactly the way it was planned. And one thing to note [indiscernible] it is being managed very well by Marriott. There's a lot of transparency across all parties. There are obviously multiple vendors involved in this. And we and the other vendors have good seats at the table We are all aware, the details are transparent. We are all aware of what is going on. And there's a remarkable degree of cooperation and coordination among all the parties So things are going on well.

41m 55s

You mentioned that you won't be surprised if international is a record this quarter. Which would be suggestive of some near term pipeline opportunities. What is that dependent on this quarter? Is it dependent on you winning something that you are anticipating winning or is it the timing of the decision that's more important? [indiscernible] characteristic of international sales for the last few quarters which is sort of both good news and bad news, George. Is that it is still dependent on a few home loans and not enough singles and doubles. And there are a couple of significant sales opportunities that we've been working on that I think hopefully should come to fruition during the next few months So there is a chance that this quarter, January through March, could be a record quarter for international sales But that still doesn't get out of the doldrums. We still need to build a solid pipeline of singles and doubles which we are working on. We are building our reputation are increasing our relationships. But these kinds of big wins when they happen do matter. Because it increases our presence But The dependence is still on the big hits, the big home runs.

43m 19s

We need to develop more singles and doubles the international regions.

43m 24s

One other thing if I could, you mentioned the new Agilisys is still not necessarily appreciated as broadly as you would like. I'm curious if you can bifurcate that to domestic versus international. Do you feel your known better domestically and therefore seeing the opportunities you should see and and then on the other side, on the international side, my assumption is you're not seeing as many opportunities as you think you should based on the new Agilysys Yes. In terms of the reputation of the new Agilisys JARs, We do have 2 hills to climb, 1 domestic and 1 international And there is no question that the domestic hill is a lot shorter to climb. We already have a reputation domestically. We are well known reasonably well known. Now we are trying to spread the message of the new Agilysys. And for that, a lot of the new installations, meaning installations based on the new modernized and unified versions, we are getting more and more of them done And as they continue to go well, the message of the new Agilysys the modernized cloud native solutions keeps spreading. Internationally, that hill is a lot higher to climb. Because we just didn't have that much of a reputation before, not only do we have to establish the name of Agilysys there, and then we have to establish the name of new Agilisys as well.

44m 47s

And a lot of the big projects, the big sales opportunities we're working on will provide us that news, right, will provide us referenceable customers around whom we can build. To answer your question, it is definitely an easier process domestic than in international.

45m 6s

Gotcha. I'll leave it to others. Thank you very much.

45m 9s

Thank you, Josh. We stand by for our next question. Our next question comes from the line of Sam Salvis with Needham and Company. Your line is open.

45m 22s

Great. Thanks.

45m 23s

Hey, guys. I'm just hopping on for Mayank here tonight. I wanted to touch on the POS sales in the quarter.

45m 30s

I know you said they were better than the Q1, but they still declined to sequentially. So I'm just curious if you guys could talk about what gives you confidence that these trends are going to get better in the coming quarters and throughout the coming year.

45m 49s

Yes. So our confidence that POS sales will continue improving is based on the pipeline we are working on now, Like we told you, there is one crucial metric of pipeline that we manage internally, that we refer to as demo plus pipeline. So our sales pipeline runs into 100 of 1,000,000 of dollars.

46m 10s

But within that, we focus on a subset that we call demo plus which is the pipeline of sales opportunities where we have at least reached the product demonstration stage. Where the customer has asked for product demos and those product demos are going on. Now that pipeline for PMS is something like 37% higher than the same time last year, meaning compared December and calendar 2024 with December and calendar 2023, [indiscernible] PMS is like 37% higher, but POS is 22% higher. We are working through a lot of significant POS sales opportunities. Now I would not put too much focus on the fact Comparing sales of Q1 versus Q2 versus Q3, One thing is clear to us, Q1 was the definite bottom point. We have struggled with POS sales for a couple of quarters Q1 hit a low point and since then we are climbing back upwards. And there are significant POS sales opportunities we are working on now which gives us the confidence that things will improve reasonably quickly during the coming few quarters.

47m 23s

Got it. Okay. That's helpful. And then just a quick follow-up on the the 11 new subscription logos you guys signed in the quarter. Could you just quickly talk about what markets these were in, which verticals and and maybe parse out how many were POS versus PMS?

47m 45s

A good portion of them were [indiscernible] like it usually is for us. Many of them involve both POS and PMH together. And probably the main highlight of that was that each of them involved purchase of 6 products which is a record high for us. We have never been anywhere close to that 6 number on an average across all the new customers. And 6 was a record high for us. So each customer who came to us purchased several products And most of them involved both POS and PMS. So POS was more than in that In terms of verticals, I don't know exactly which vertical they were more of, but it involved all verticals. There was no particular vertical where I could highlight for you. It involved all our sales verticals. There were new customers across all of Okay. Good to hear.

48m 46s

Thanks guys. I'll jump back in.

48m 49s

Thank you, Our next question comes from the line of Aiden Gutkind with Oppenheimer. Your line is open.

49m

Hi, this is Brian Schwartz for Oppenheimer. Thanks for taking my questions. Ramesh, in terms of the point of sale bookings we that you talked a lot about, is that mostly contained [indiscernible] Foods category, or is it happening in those other categories?

49m 22s

It was to answer your question, Brian, it's mostly [indiscernible] huge majority of it is mostly because of the managed full service verticals. Though I would say that in the other verticals, But in terms of the challenges we've had they have been for the large part in the managed food services vertical. And in that vertical and also in the lower end of the markets, in the other verticals as well, These are all major restaurants, cafeterias, F and B places that don't have the greatest IT support. Right? They cannot afford huge IT departments. So the products have to be simple to install, They have to be simple to support. They have to be very simple to upgrade. Those are all requirements in the POS. Now that's how our POS systems used to be. But we took on this massive transformation of reengineering it completely into cloud native products and also unify staff facing and guest facing feature sets and it became more complicated than it it should be. And that cost pause in some of the opportunities coming through. Which we are now getting past since lot of the new installs are back to being simple to upgrade to enhance and support.

50m 42s

But it was the damage was mostly in the managed foodservice world.

50m 46s

Okay. Moving on Ramesh, in your introductory comments, it sounds like you're putting a greater focus on the go to market on the new customer acquisition and I know that that hasn't been the primary source for bookings, more of it comes from the installed base. My question for you is, does that change the cadence of your sales rep hiring for next year? Are you looking to scale up the capacity of more hunters or are you planning to make any other change either the organizational structure or the leadership to support a greater focus on the the customer acquisition motion next year?

51m 32s

Yes. So Brian, the customer acquisition [indiscernible] Yes, it's more on getting more newer customers. And the fundamental thing we are doing now we are focused on is ensuring full territory coverage. Which is where we have been lacking before. Now we are continuing to we are continuing to we are going to get a lot of sales from our current customers. We have great relationships with them. They're all very happy that we have modernized our products. And they have been with us for a very long time. So the new product sales, selling more products to customers with at least one of our products is going to continue to increase. Like I said in my opening remarks, in 3 quarters this year, this is already our best year. We have 1 quarter to go and we are far ahead of full previous year. So that is going to continue. But our success has to come a lot more from new customers and new sites as well. Now couple of things. Number 1, we have plenty of room for sales growth with the current sales team. We did expand our sales team over the last 1 or 2 years.

52m 38s

And we still have what I would call the second half of the sales team that can do a lot better than they are doing today. So the focus is on that. They've all gone through the ramp time and now that the products are there to sell, we are expecting a lot more from them. So the first thing is there is plenty of room for sales growth with the current sales Now Joe Youssef is also focused on expanding the sales teams. Especially in the Hotels and Resorts area and we are focused on making sure we cover the territory. There are still thousands of properties that we are not touching properly at the moment. And we are focused on expanding our sales team to ensure full territory coverage. Now the rest of all the teams are focused on helping sales We want to make sure we create a lot more referenceable customers with the newer versions so that it becomes easier for sales to sell. So we are focused on all those areas, Guy.

53m 36s

Thank you. And one follow-up for Dave. Just on the guidance, are you taking the same methodology as you've had before or are you injecting a little more conservatism given the guidance as has been walked down here couple of times. Just getting a lot of questions whether this is a new guide or still kind of the same pipeline that you're looking at. If you could share any color on that methodology, I'd appreciate it.

54m 7s

I think it's a consistent way of guiding. I mean, we feel very strong about the short and medium term opportunities through the pipeline. I mean, Ramesh gave a lot of commentary about how well our pipeline is doing. But obviously, with only a couple of months left in the the quarter we're likely not going to make up some of the services shortfall and some of the the product shortfall. I mean, I would expect product revenue to kind of remain about where it is today, maybe up a little bit Services obviously will improve next quarter as we without the holiday impact. And then the normal subscription growth you're used to seeing to kind of get you to the 25 percent guide. But I would say there's not a there's not a change in methodology. I mean, we feel as strong as we ever have about our pipeline in the the medium and short term of Agilisys, but with just 1 quarter left, it's going to be hard to make up the one time revenue.

55m 1s

Thank you.

55m 2s

Thank you. Please stand by for our next question. Our next question comes from the line of Nehal Chokshi with Northland Capital Markets. Your line is open.

55m 15s

Thank you.

55m 17s

Ramesh, in your prepared remarks, you said something was up 7% in your review. I didn't catch what that something was. Could you repeat that please? We said are you listening to the sales pipeline comment we made Nehal?

55m 32s

I believe so, yes.

55m 35s

Yes. So Taking out the PMS bookings, or some sort of bookings?

55m 41s

Yes. We are referring to the sales pipeline or you're referring to the bookings or you're referring to the subscription revenue growth. So let me just cover that very quickly. Let's talk about bookings first. PMS and PMS related add on modules sales booking, at the end of 3 quarters is already a record full year for us. So in terms of sales bookings of PMS and PMS related add on modules, are a record for us, record as far as full year is concerned. Without book for time, If you remove book for time numbers out of it, the sales of PMS and related modules is about 70% higher this Q3 than last Q3. So you take this October to December, just add up all our PMS. By the way, there is no Marriott PMS sales included in all this because we have not yet started including that in sales. The sales of PMS and add on modules this Q3 was 70 70%, 70% higher than sales during last year's Q3. That's one thing we mentioned. We also mentioned that including Book for Time, sales of PMS and related modules in 3 quarters is already our best ever year higher than 33% compared to the previous best full year.

57m 3s

We mentioned both those aspects. And we also said that sales pipeline and we only count pipeline that have reached the demonstration stage of products PMS this year is about 37% higher than PMS at the same time. December end last year. I think those are the 3 things we mentioned. Yes, that's great. And just to be clear, Pima's bookings excluding book for time is up 70% year over year which is tracking way ahead of your pipeline growth?

57m 37s

Is that just a result of Timing or is that a result of increased win rates? It is because of additional signings with new customers. That is customers who didn't have our PMS products before signing up to buy PMS products. Yes, you compare Q3 this year that we just completed with Q3 last year, it is 70%, 70% higher in terms of actual sales signed with customers. Okay. And that is that is tracking ahead of pipeline. And that is where we wish POS sales had also done well we would be flying a lot higher now. [indiscernible] And then in the past, you had talked about module attach rate for PMS bookings. Can you give out that metric again?

58m 25s

For the December quarter? Yes. Mostly for the newer customers, the new what we said the new customers will sign bought an average of 6 products from us, which is a record high for us. And generally, the PMS attach rate of add modules is about 8 modules, it's about 8.5 modules per PMS deal that we signed. Every time we sign a PMS deal, it goes along with about 7 to 8 attached add on models. Okay. And then my last question is that And we have more sorry Nehal, we have more add on modules with BMS than we have with POS. [indiscernible] [indiscernible] Understood.

59m 8s

And then you've got a new TAM slide where you're going from what used to be a $5,000,000,000 ARR TAM that you used to cite 6 months ago to now 16,000,000,000 you take us through the confidence level that Agiosus really is addressing this incremental $11,000,000,000 and whether or not expectations it's type of market share you think you can get in your core markets is the same for these adjacencies that you've identified? [indiscernible] We feel like the new TAM represents our current market. I mean, the old TAM we had not rolled in a lot of the add on modules. I mean, keep in mind, most of these add on modules are we call them add on modules, but they're really standalone products that are competing with 5 to 10 people in the market at any given point. We had counted that as a practice weighted tool. They were had the ability to compete on a best of breed to roll that in. But most of the TAM expansion is really just rolling in our add on modules that after 3 or 4 years are now competing on a best of breed methodology.

1h 16s

Okay. And then implicitly, currently you have lower market share on this incremental salmon that's expected. But on a longer term basis, would you expect the market share on that incremental TAM to continue to be far less than your market share of your core markets? Current core markets?

1h 39s

No, I mean, we expect I mean, whether you're talking about add on or PMS core, I mean, we're such we have such low market share today. I mean, we still have less than 300,000 rooms in near 20,000,000 room market. There's plenty of expansion in our core solutions And obviously, like we've talked about a lot over the last couple of years, we're we're just starting to compete on a best of breed in our Tier 2 core and our add on module. So don't feel like we're butting up against any kind of market penetration limitations. And we think across the board, we'll take more market share over the the short and medium term.

1h 1m 18s

Right. Thank you.

1h 1m 20s

Thank you. Please stand by for our next question.

1h 1m 25s

Our next question comes from the line of Steven Sheldon with William Blair.

1h 1m 31s

Hey, everyone. You have Matt Fylak on for Steve and Sheldon. Thank you for taking my questions. Wanted to start with a couple of quick model questions for Dave. Number 1, how should we be thinking about gross margins in the 4th quarter and into next year in light of the challenges with the point of sale sales activity And then 2, can you just clarify what you mean by more normalized growth rates for the professional service line item looking into next year?

1h 2m 1s

Yes. So I mean for us we kind of look at the business It's been the gross margin is obviously been growing over the last 4 or 5 years. As we've made transition to more of a subscription based We went into this year kind of thinking they would [indiscernible] into the 60% gross margins for the first time. Now I mean we're trending closer to the 63% gross margin. That feels more normal to us. I mean, so going into next year, I would assume you would see gross margin expansion incrementally. I don't think there's going to be a 5% or 6% jump, but I would think gross margins will continue to grow up a point or 2.

1h 2m 39s

From where they are today at 62%, 63%. So So with the change in product mix, I don't think we'll we'll go back down to the low 60s or high 50s in gross margin. Question about service. And then the normalized service is I mean, so really the way we think about professional services is professional services is the line that kind of grows with top line revenue. And obviously, the last couple of quarters, we've had the major development and we've had some 37%, 39% type services growth, which is not normal for us. Expect professional services to grow in line with top line. So if top line is growing 15% to 20%, professional services probably grows around the same level.

1h 3m 22s

Obviously, once kind of backing out some of the one time anomalies we've had fiscal year.

1h 3m 30s

On both of those. And then this question was somewhat addressed already, but I just wanted to circle back on it. So for the Marriott rollout, is there anything you can share on the planned pace of rollout from a location perspective? Perspective? And then are there any regions in particular that you may initially focus that deployment?

1h 3m 49s

Unfortunately, Matt, no, we cannot. So the best we can tell you now project is going well. Is a high degree of transparency across all the parties and it is being managed very well. And what we expect in the second half of calendar twenty twenty five Our test properties and following that pilot sites to go live. That is the best we can tell you now, unfortunately.

1h 4m 18s

Yes. Thank you, Matt.

1h 4m 22s

Ladies and gentlemen, I'm showing no further questions in the queue. Now like to turn the call back over to Ramesh for closing remarks.

1h 4m 29s

Thank you, Towanda. Thank you for all your interest and support. Best wishes to all of you for a very happy, healthy, safe and successful 2025. Look forward to catching up again around the middle to end of May we will be reporting Q4 and full fiscal year 2025 results. Thank you.

1h 4m 48s

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.

Key Insights

Agilisys reported fiscal 2025 Q3 revenue of $69.6 million, a 14.9% increase year-over-year, marking the 12th consecutive record revenue quarter. Recurring revenue grew 26.4% year-over-year, with subscription revenue up 45.1%, now comprising 63.8% of total recurring revenue.
Sales of Property Management Systems (PMS) and related modules were a highlight, with bookings up 70% year-over-year in Q3 (excluding Book for Time). Fiscal 2025 is already a record year for PMS sales, surpassing the previous best full year by 33%.
Point of Sale (POS) sales underperformed expectations, particularly in the managed food services vertical, due to challenges in transitioning to modernized cloud-native products. However, the company expects POS sales to improve in the coming quarters, supported by a 22% year-over-year increase in the POS demo-plus sales pipeline.
Agilisys lowered its fiscal 2025 total revenue guidance to $273 million but maintained its profitability and subscription revenue growth guidance of at least 38%. Adjusted EBITDA for Q3 was $14.7 million, representing 21.2% of revenue.
The company highlighted strong sales momentum, with a record-high demo-plus sales pipeline and significant progress in transitioning to modernized product versions. Agilisys remains optimistic about medium- and long-term growth opportunities, particularly in PMS and international markets.

Recent Transcripts

Fiscal 2025 Q3 revenue hit $69.6M, recurring revenue grew 26.4%.

Income Statement

Revenue

	2020	2021	2022	2023	2024
Revenue	$161M	$137M	$163M	$198M	$237M
Cost of Revenue	$80M	$48M	$61M	$77M	$93M
Gross Profit	$81M	$89M	$102M	$121M	$144M
Gross Profit %	50%	65%	62%	61%	61%
R&D Expenses	$41M	$55M	$46M	$50M	$57M

2020

2021

2022

2023

2024

Revenue

$161M

$137M

$163M

$198M

$237M

Cost of Revenue

$80M

$48M

$61M

$77M

$93M

Gross Profit

$81M

$89M

$102M

$121M

$144M

Gross Profit %

50%

65%

62%

61%

R&D Expenses

$41M

$55M

$46M

$50M

$57M

Cash Flow

Net Income

	2020	2021	2022	2023	2024
Net Income	-$34M	-$21M	$6.5M	$15M	$86M
Dep. & Amort.	$18M	$4.8M	$3.9M	$3.5M	$5.3M
Def. Tax	-$356K	-$959K	-$925K	-$181K	-$66M
Stock Comp.	$5.2M	$40M	$15M	$13M	$14M
Chg. in WC	-$1.6M	$5.4M	$4.3M	$3.5M	$10M

2020

2021

2022

2023

2024

Net Income

-$34M

-$21M

$6.5M

$15M

$86M

Dep. & Amort.

$18M

$4.8M

$3.9M

$3.5M

$5.3M

Def. Tax

-$356K

-$959K

-$925K

-$181K

-$66M

Stock Comp.

$5.2M

$40M

$15M

$13M

$14M

Chg. in WC

-$1.6M

$5.4M

$4.3M

$3.5M

$10M

Balance Sheet

Cash

	2020	2021	2022	2023	2024
Cash	$47M	$99M	$97M	$113M	$145M
ST Investments	$0	$0	$0	$0	$0
Cash & ST Inv.	$47M	$99M	$97M	$113M	$145M
Receivables	$38M	$28M	$27M	$25M	$32M
Inventory	$3.9M	$1.2M	$6.9M	$9.8M	$4.6M

2020

2021

2022

2023

2024

Cash

$47M

$99M

$97M

$113M

$145M

ST Investments

Cash & ST Inv.

$47M

$99M

$97M

$113M

$145M

Receivables

$38M

$28M

$27M

$25M

$32M

Inventory

$3.9M

$1.2M

$6.9M

$9.8M

$4.6M

Go Deeper

Financial information provided by Financial Modeling Prep. Options data provided by Unusual Whales. Live transcripts provided by Quartr. All data is provided for informational purposes only, and is not intended for trading purposes or financial, investment, tax, legal, accounting or other advice. · See all tickers.

Earnings

Report Date

Jan 21, 2025

Reported Revenue

69.6M

Avg 1d Change

11.88%

Report Period

Q3 2025

Reported EPS

0.27

Implied Move 1d

11.74%

Transcript

11m 5s

Thank you for joining the Agilisys 2025 Third Quarter Conference Call.

11m 9s

12m 22s

With that, I'd now like to turn the call over to Mr. Ramesh Srini Vassan, President and CEO of Agilisys. Ramesh, please go ahead. Good evening.

12m 32s

Welcome to the fiscal 2025 Q3 earnings call.

12m 36s

14m 32s

16m 25s

18m 2s

19m 40s

21m 27s

23m 20s

25m 5s

26m 55s

28m 28s

30m 8s

30m 56s

Total recurring revenue represented 63.8 percent of total net revenue for the fiscal 3rd quarter, compared to 58% in the Q3 of fiscal 2024.

31m 8s

33m 9s

34m 43s

35m 49s

37m 10s

38m 43s

39m 6s

With that to end, let's open up the call for questions. Thank you.

39m 27s

Our first question comes from the line of George Sutton with Craig Hallum. Your line is open.

39m 36s

39m 52s

40m 37s

41m 55s

43m 19s

We need to develop more singles and doubles the international regions.

43m 24s

44m 47s

45m 6s

Gotcha. I'll leave it to others. Thank you very much.

45m 9s

Thank you, Josh. We stand by for our next question. Our next question comes from the line of Sam Salvis with Needham and Company. Your line is open.

45m 22s

Great. Thanks.

45m 23s

Hey, guys. I'm just hopping on for Mayank here tonight. I wanted to touch on the POS sales in the quarter.

45m 30s

45m 49s

46m 10s

47m 23s

47m 45s

48m 46s

Thanks guys. I'll jump back in.

48m 49s

Thank you, Our next question comes from the line of Aiden Gutkind with Oppenheimer. Your line is open.

49m

49m 22s

50m 42s

But it was the damage was mostly in the managed foodservice world.

50m 46s

51m 32s

52m 38s

53m 36s

54m 7s

55m 1s

Thank you.

55m 2s

Thank you. Please stand by for our next question. Our next question comes from the line of Nehal Chokshi with Northland Capital Markets. Your line is open.

55m 15s

Thank you.

55m 17s

55m 32s

I believe so, yes.

55m 35s

Yes. So Taking out the PMS bookings, or some sort of bookings?

55m 41s

57m 3s

57m 37s

58m 25s

59m 8s

1h 16s

1h 39s

1h 1m 18s

Right. Thank you.

1h 1m 20s

Thank you. Please stand by for our next question.

1h 1m 25s

Our next question comes from the line of Steven Sheldon with William Blair.

1h 1m 31s

1h 2m 1s

1h 2m 39s

1h 3m 22s

Obviously, once kind of backing out some of the one time anomalies we've had fiscal year.

1h 3m 30s

1h 3m 49s

1h 4m 18s

Yes. Thank you, Matt.

1h 4m 22s

Ladies and gentlemen, I'm showing no further questions in the queue. Now like to turn the call back over to Ramesh for closing remarks.

1h 4m 29s

1h 4m 48s

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.

Key Insights

Agilisys reported fiscal 2025 Q3 revenue of $69.6 million, a 14.9% increase year-over-year, marking the 12th consecutive record revenue quarter. Recurring revenue grew 26.4% year-over-year, with subscription revenue up 45.1%, now comprising 63.8% of total recurring revenue.
Sales of Property Management Systems (PMS) and related modules were a highlight, with bookings up 70% year-over-year in Q3 (excluding Book for Time). Fiscal 2025 is already a record year for PMS sales, surpassing the previous best full year by 33%.
Point of Sale (POS) sales underperformed expectations, particularly in the managed food services vertical, due to challenges in transitioning to modernized cloud-native products. However, the company expects POS sales to improve in the coming quarters, supported by a 22% year-over-year increase in the POS demo-plus sales pipeline.
Agilisys lowered its fiscal 2025 total revenue guidance to $273 million but maintained its profitability and subscription revenue growth guidance of at least 38%. Adjusted EBITDA for Q3 was $14.7 million, representing 21.2% of revenue.
The company highlighted strong sales momentum, with a record-high demo-plus sales pipeline and significant progress in transitioning to modernized product versions. Agilisys remains optimistic about medium- and long-term growth opportunities, particularly in PMS and international markets.

Agilysys, Inc. Price & Performance (AGYS)

Stock Performance

Open

High

Low

Market Cap

P/E Ratio

Volume

Year High

Year Low

News & Market Insights

What's Happening

Peers

Earnings

Report Date

Reported Revenue

Avg 1d Change

Report Period

Reported EPS

Implied Move 1d

Transcript

Key Insights

Recent Transcripts

Income Statement

Cash Flow

Balance Sheet

Go Deeper

Related

News & Market Insights

Go Deeper

Earnings

Report Date

Reported Revenue

Avg 1d Change

Report Period

Reported EPS

Implied Move 1d

Transcript

Key Insights

Recent Transcripts