Hospitality software provider Agilysys (NASDAQ:AGYS) reported revenue ahead of Wall Streets expectations in Q4 CY2025, with sales up 15.6% year on year to $80.39 million. The company expects the full year’s revenue to be around $318 million, close to analysts’ estimates. Its non-GAAP profit of $0.42 per share was 7.8% below analysts’ consensus estimates.
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Agilysys (AGYS) Q4 CY2025 Highlights:
- Revenue: $80.39 million vs analyst estimates of $79.28 million (15.6% year-on-year growth, 1.4% beat)
- Adjusted EPS: $0.42 vs analyst expectations of $0.46 (7.8% miss)
- Adjusted Operating Income: $17.15 million vs analyst estimates of $9.66 million (21.3% margin, 77.6% beat)
- The company slightly lifted its revenue guidance for the full year to $318 million at the midpoint from $316.5 million
- Operating Margin: 14.6%, up from 10.7% in the same quarter last year
- Free Cash Flow Margin: 28.3%, up from 18.9% in the previous quarter
- Market Capitalization: $3.00 billion
Ramesh Srinivasan, President and CEO of Agilysys, commented, “Q3 Fiscal 2026 revenue was a record $80.4 million, the 16th consecutive record revenue quarter, with 15.6% year-over-year total revenue growth driven by subscription revenue growth of 23.1%. We are pleased to see the business momentum surge that occurred during the first half of Fiscal 2026 carry into the second half.
Company Overview
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.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Agilysys grew its sales at a 17.2% compounded annual growth rate. Although this growth is acceptable on an absolute basis, it fell slightly short of our standards for the software sector, which enjoys a number of secular tailwinds.
Long-term growth is the most important, but within software, a half-decade historical view may miss new innovations or demand cycles. Agilysys’s annualized revenue growth of 16.7% over the last two years aligns with its five-year trend, suggesting its demand was stable. 
This quarter, Agilysys reported year-on-year revenue growth of 15.6%, and its $80.39 million of revenue exceeded Wall Street’s estimates by 1.4%.
Looking ahead, sell-side analysts expect revenue to grow 13.1% over the next 12 months, a deceleration versus the last two years. This projection doesn't excite us and suggests its products and services will face some demand challenges.
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Customer Acquisition Efficiency
The customer acquisition cost (CAC) payback period measures the months a company needs to recoup the money spent on acquiring a new customer. This metric helps assess how quickly a business can break even on its sales and marketing investments.
Agilysys is very efficient at acquiring new customers, and its CAC payback period checked in at 22.8 months this quarter. The company’s rapid recovery of its customer acquisition costs indicates it has a highly differentiated product offering and a strong brand reputation. These dynamics give Agilysys more resources to pursue new product initiatives while maintaining the flexibility to increase its sales and marketing investments.
Key Takeaways from Agilysys’s Q4 Results
It was encouraging to see Agilysys beat analysts’ EBITDA expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. Overall, this print had some key positives. The market seemed to be hoping for more, and the stock traded down 12.3% to $99.68 immediately after reporting.
So do we think Agilysys is an attractive buy at the current price? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).