On July 22, 2024, Agilysys Inc (AGYS, Financial) released its 8-K filing for the fiscal 2025 first quarter ending June 30, 2024. Agilysys Inc has been a leader in hospitality software, delivering innovative cloud-native SaaS and on-premise solutions for hotels, resorts, cruise lines, casinos, corporate food service management, restaurants, universities, stadiums, and healthcare. The company's software solutions include point-of-sale (POS), property management (PMS), inventory and procurement, payments, and related applications that manage and enhance the entire guest journey. Agilysys is also known for its world-class customer-centric service.
Performance Overview
Agilysys Inc (AGYS, Financial) reported a total net revenue of $63.5 million for the fiscal 2025 first quarter, marking a 13.3% increase compared to $56.1 million in the same period last year. Despite this growth, the revenue fell short of the analyst estimate of $64.47 million. However, the company exceeded earnings expectations with an adjusted EPS of $0.30, significantly higher than the estimated $0.13.
Key Financial Achievements
The company achieved a record recurring revenue of $38.0 million, which constituted 59.9% of the total net revenue. Subscription revenue saw a substantial year-over-year increase of 32.0%, highlighting the company's successful transition towards a subscription-based model. Gross margin improved to 62.8% from 59.0% in the prior-year period, reflecting enhanced operational efficiency.
Income Statement Highlights
| Metric | Q1 FY2025 | Q1 FY2024 |
|---|---|---|
| Total Net Revenue | $63.5M | $56.1M |
| Gross Profit | $39.9M | $33.1M |
| Gross Margin | 62.8% | 59.0% |
| Net Income | $14.1M | $1.1M |
| Adjusted EBITDA | $12.1M | $6.3M |
| Adjusted EPS | $0.30 | $0.18 |
Balance Sheet and Cash Flow
Agilysys Inc (AGYS, Financial) ended the quarter with a cash balance of $144.1 million, slightly down from $144.9 million at the end of fiscal 2024. The company generated a free cash flow of $0.2 million, a significant improvement from the negative free cash flow of $(3.0) million in the same period last year.
Commentary and Outlook
"We are pleased to report our tenth consecutive record revenue quarter at $63.5 million, a 13.3% increase over the comparable prior year quarter, which included strong year-over-year growth of 32.0% for subscription revenue and 39.8% for services revenue," said Ramesh Srinivasan, President and CEO of Agilysys.
Despite challenges with product revenue, the company remains optimistic about its future. The fiscal 2025 outlook projects full-year revenue between $275 million and $280 million, with subscription revenue expected to grow by more than 27% year-over-year. Adjusted EBITDA is anticipated to be 16% of revenue for the full fiscal year.
"Subscription and services revenue growth are ahead of our fiscal year 2025 plan and continue to drive the business toward our fiscal 2025 expectations," commented Dave Wood, Chief Financial Officer.
For more detailed insights and financial tables, readers are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from Agilysys Inc for further details.
