Q4 2025 Agilysys Inc Earnings Call
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Operator: Ladies and gentlemen, thank you for standing by. Your conference call will begin in one minute. Thank you for your patience and please stand by.
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Speaker Change: Ladies and gentlemen, thank you for standing by your conference call will begin in one minute. Thank you for your patience and please standby.
Speaker Change: [music].
Speaker Change: Good day, ladies and gentlemen, and welcome to the Agilis is 2025 fourth quarter and full fiscal year conference call.
Speaker Change: At this time all participants are in a listen only mode.
Speaker Change: After the speaker's presentation, there will be a question and answer session to participate you will need to press star one one on your telephone you walked in here and message of di senior Handpiece raced to withdraw your question simply press Star one again.
Speaker Change: As a reminder, today's conference is being recorded.
Speaker Change: I'd now like to turn the conference over to Jessica Hennessy Senior director of corporate strategy and Investor Relations at Genesis you may begin.
Jess: Thank you, Carmen. And good afternoon, everybody.
Speaker Change: Thank you Carmen and good afternoon, everybody. Thank you for joining via jealous is 2025 fourth quarter and full fiscal year conference call. We will get started in just a minute with management's comments, but before doing so let me read the safe Harbor language.
Jess: Thank you for joining the Agilysys 2025 fourth quarter and full fiscal year conference call. We will get started in just a minute with management's comments.
Jess: But before doing so, let me read the safe harbor language. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the safe harbor protections of the U.S. 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 results to differ materially.
Speaker Change: Statements made on today's call will be predictive and are intended to be made as forward looking within the safe Harbor protection of the U S. Private Securities Litigation Reform Act of 1995.
Speaker Change: Any statements regarding our financial guidance.
Speaker Change: Although the company believes that its forward looking statements are best are based on reasonable assumptions such statements are subject to risks and uncertainties that could cause results to differ materially.
Jess: Important factors that could cause actual results to vary materially from these forward-looking statements include the impact macroeconomic factors may have on the overall business environment, our ability to achieve the provided guidance levels, maintaining sales momentum, The company's ability to convert the backlog into revenue, and the risks set forth in the company's reports on Form 10-K and 10-Q, and other reports filed with the Securities and Exchange Commission.
Speaker Change: Important factors that could cause actual results to vary materially from these forward looking statements include the impact of the macroeconomic factors may have on the overall business environment, our ability to achieve the provided guidance levels.
Speaker Change: Maintaining sales momentum.
Speaker Change: The company's ability to convert the backlog into revenue and the rest of that forth in the company's reports on Form 10-K, and 10-Q and other reports filed with the Securities and Exchange Commission.
Jess: As a reminder, any references to record financial or business levels during this call refer only to the time period after Agilysys made the transformation to an entirely hospitality-focused software solutions company in fiscal year 2014.
Speaker Change: As a reminder, any references to record financial or business levels. During this call refer only to the time period. After Joseph made the transformation to an entirely hospitality focused software solutions company in fiscal year 2014.
Ramesh Srinivasan: With that, I'd now like to turn the call over to Mr. Ramesh Srinivasan, President and CEO of Agilysys. Ramesh, please go ahead. Thank you, Jess. Good evening.
Speaker Change: With that I'd now like to turn the call over to Mr. Ramesh Srinivasan, President and CEO Jonathan Ramesh. Please go ahead.
Ramesh Srinivasan: Thank you Jess good evening welcome.
Ramesh Srinivasan: Welcome to the fiscal 2025 fourth quarter and full year earnings call.
Ramesh Srinivasan: Welcome to the fiscal 2025 fourth quarter and full year earnings call.
Ramesh Srinivasan: Joining Jess and me on the call today at our Alpharetta Atlanta headquarters is Dave Wood, our CFO. Let me cover sales first before moving to revenue and other details. Please note that all are sales and selling success related values. are measured in annual contract value terms. Please also note that all the sales values reported in this narrative, including subscription and services sales, do not include anything from the Marriott Property Management System, PMS project. that we continue to make good progress with and remains on the planned trajectory. Further, all the fiscal year 2026 guidance and other future projection numbers and narratives assume no material subscription revenue from this project.
Ramesh Srinivasan: Joining me on the call today, and then I'll turn it back Atlanta headquarters is stable.
Ramesh Srinivasan: Paul.
Ramesh Srinivasan: Let me comment first before moving to revenue and other these days.
Ramesh Srinivasan: No that's all of sales and selling success related values.
Ramesh Srinivasan: May showed an annual contract value.
Ramesh Srinivasan: Please also note that all the sales value as reported in this narrative.
Ramesh Srinivasan: Subscription and services sales.
Ramesh Srinivasan: Not including any.
Ramesh Srinivasan: Anything from the Marriott property management system BMS project.
Ramesh Srinivasan: We continue to make good progress with <unk>.
Ramesh Srinivasan: The names on the planned trajectory.
Ramesh Srinivasan: Further all of the fiscal year, 2026 guidance and other future prediction numbers that matter to us.
Ramesh Srinivasan: Assume no material subscription revenue from this project.
Ramesh Srinivasan: Fiscal 2025, the year that ended March 2025, was a record global sales year overall and a record year for practically every sales vertical other than managed food services. It was a record sales year for international regions. Gaming Casino hotels and resorts, and overall North America domestic sales. Across product categories, it was a record sales year by a significant distance for subscription SaaS software and services. Full fiscal year 2025 was also a record sales year for PMS and PMS related add-on modules excluding book-for-time sales. 58% higher than the previous best year. We continue to make great progress on the PMF side of our...
Ramesh Srinivasan: Fiscal 2025, the year that ended March 2025 was a record global sales here overall.
Ramesh Srinivasan: Our record year in practically every sales vertical.
Managed services.
Ramesh Srinivasan: It was a record sales year for international regions gaming casinos.
Ramesh Srinivasan: Hotel similar thoughts on overall North America domestic sales.
Ramesh Srinivasan: Across product categories. It was a record sales here by a significant distance for subscription and SaaS software and services.
Ramesh Srinivasan: For fiscal year 2025 was also a record sales here.
Ramesh Srinivasan: For BMS and BMS related add on modules.
Ramesh Srinivasan: <unk> booked for dine in sales.
Ramesh Srinivasan: The 8% higher than the previous best year.
Ramesh Srinivasan: We continue to make great progress on the Pms side of our business.
Ramesh Srinivasan: Overall...
Ramesh Srinivasan: Overall.
Ramesh Srinivasan: The January through March period, fourth quarter of fiscal 2025, was our best sales quarter ever. with respect to point of sale, POS sale. Fiscal 2025 Q4 was the best quarter of the fiscal year. 27% higher than the sequentially preceding Q3. and 16% higher than the previous highest Q2 quarter. Q4 was also the best sales quarter of the year for sales in the managed food services FSM. FSM sales during the second half of fiscal 2025, that is Q3 plus Q4, was close to twice as high as the first half, Q1 plus Q2. With a newer, modernized, and unified POS platform performing well at more than 150 customer properties currently and growing rapidly, we have turned the corner and are now past the recent POS sales challenge.
Ramesh Srinivasan: The January through March period fourth quarter of fiscal 2025.
Ramesh Srinivasan: Our best sales quarter ever.
Ramesh Srinivasan: Because I think the point of sale Pos.
Ramesh Srinivasan: Sales.
Ramesh Srinivasan: 2025, Q4 was the best quarter of the fiscal year.
Ramesh Srinivasan: 27% higher than the secret actually received in Q3.
Ramesh Srinivasan: And 16%, one six and 16% higher than the previous highest Q2 quarter.
Ramesh Srinivasan: Q4 was also the best sales quarter of the year.
For sales in the managed services.
Ramesh Srinivasan: Got it.
Ramesh Srinivasan: Some sales during the second half of fiscal 2025 that is Q3, plus Q4 was close to twice as high as the first half Q1 plus Q2.
Ramesh Srinivasan: With the newer modernized and unified <unk> platform.
Ramesh Srinivasan: Forming well at more than 150 customer properties currently and growing rapidly.
Ramesh Srinivasan: Around the corner.
Ramesh Srinivasan: Now past the recent P O S sales challenges.
Ramesh Srinivasan: Implementations of the new POS platform in the field during the past several months are progressing exponentially better than when we were working through the old to new transformation phase previously, when we had to work with combinations of modules spanning across a couple of generations of technology. This quarter would have been a record overall sales quarter by a good distance, even excluding sales from book for time. Sales during the 2nd, 3rd and 4th quarters of Fiscal 2025 where respectively The third, fourth, and best sales quarters on record. Fiscal 2025 fourth quarter was the all-time best sales quarter for both North America domestic and international sales in terms of region.
These limitations of the new Pos platform in the field during the past several months.
Ramesh Srinivasan: Real good thing exponentially.
Ramesh Srinivasan: When we were working through the order to new transformation phase previously when we have to work with combinations of modules spanning across a couple of generations of technologies.
Ramesh Srinivasan: This quarter would have been a record overall sales quarters by a good distance, even excluding sales from book for that.
Ramesh Srinivasan: Sales during the second third and fourth quarters.
Ramesh Srinivasan: 2025.
Ramesh Srinivasan: Respectively.
Ramesh Srinivasan: Fourth.
Ramesh Srinivasan: Sales quarters on record.
Ramesh Srinivasan: Fiscal 2025 fourth quarter.
Ramesh Srinivasan: What the all time best sales quarter for both North America domestic and international sales in terms of regions.
Ramesh Srinivasan: And with respect to product sales category for subscription software and services. Our current selling success momentum is excellent any way one looks at it, especially with respect to subscription software and services. International sales are beginning to show positive signs of consistent growth, though they are still a bit too dependent on home run big wins. With respect to signed sales agreements during January to March Q4 All, not including Book for Time, says... We added 16, 1-6, we added 16 new customers. All these 16 sales agreements were subscription-based, and averaged six products. which equals the previous quarter record high.
Ramesh Srinivasan: And with respect to product sales categories.
Ramesh Srinivasan: Core subscription software and services sales.
Ramesh Srinivasan: Our current selling success momentum is excellent any way one looks at it.
Ramesh Srinivasan: Especially with respect to the subscription software and services.
Ramesh Srinivasan: International sales are beginning to show positive signs of consistent growth.
Ramesh Srinivasan: It's still a bit too dependent on home.
Ramesh Srinivasan: Great.
Ramesh Srinivasan: [laughter] signed sales agreements during January to March Q4.
Ramesh Srinivasan: Not including books, what I can say.
Ramesh Srinivasan: We added 16, one six we added 16 new customers.
Ramesh Srinivasan: All of these 16 sales agreement with subscription based.
Ramesh Srinivasan: Please six products to each.
Ramesh Srinivasan: With the previous quarter record high.
Ramesh Srinivasan: POS sales agreement featured an average of four products and PMF an average of 11%. We also added 50, that is 5-0. We also added 50 new properties during the quarter, which did not have any of our products before, but the parent company was already our customer. of the 66 new properties. added during the quarter across new and current customers. 63, where subscription software lies. There were also 126 instances of selling at least one additional product to properties already running at least one of our other products. These 126 instances involved sales of a total of 287 products.
Ramesh Srinivasan: It seems like remains featured an average of four products each.
Ramesh Srinivasan: And Pms, an average of 11 products.
Ramesh Srinivasan: We also added 50 that is five zero. We also added 50 new properties during the quarter.
Ramesh Srinivasan: Which did not have any of our products before.
Ramesh Srinivasan: But the parent company was already our customers.
Ramesh Srinivasan: After 66, new properties added during the quarter.
Ramesh Srinivasan: Across new and current customers 63 with subscription software license base.
Ramesh Srinivasan: They have been also one to 126 instances of selling at least one additional product to properties already running at least one of our other products.
Ramesh Srinivasan: These 126 instances involved sale.
Ramesh Srinivasan: 287 products.
Ramesh Srinivasan: Both these numbers and the total value of new product sales to current properties were all-time best quarter levels. Full fiscal year 2025 new product sales to current properties running at least one other Agilysys product was also a record high. More than 50%, that is 5-0, more than 50% higher than the previous best.
Ramesh Srinivasan: Both of these numbers.
Ramesh Srinivasan: Total value of new product sales to current properties that all time best quarterly levels.
Ramesh Srinivasan: Full fiscal year 2000 to 85, new product sales to current properties running at least one other atlas's product was also a record high.
Ramesh Srinivasan: More than 50% of that is five zero of more than 50% higher than the previous best year.
Ramesh Srinivasan: Yeah.
Ramesh Srinivasan: The current Global Demo Plus Stage 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 18%, 1.8, 18% higher as of March end compared to the same time the previous year. As of March end, this demo plus sales pipeline was 16%, one-sixth. 16% and 32% higher for POS and PMS opportunities respectively compared to the same time one year ago. as more customers get to this Demo Plus stage.
Ramesh Srinivasan: The current global demo Bluff stage sales pipeline.
Ramesh Srinivasan: Measured at the annual contract value some or all sales opportunities. We are currently working on.
Ramesh Srinivasan: <unk> reached at least the product demonstration stage is now at a record level.
Ramesh Srinivasan: Since we started tracking this value a couple of years ago.
Ramesh Srinivasan: And was 18% one 818% higher as of March end compared to the same time the previous year.
Ramesh Srinivasan: As of March and this demo plus sales pipeline was 16%, one 616% and 32% higher.
Ramesh Srinivasan: Pos and pms opportunities, respectively compared to the same yet at the same time one year ago.
Ramesh Srinivasan: As more customers get to this demo plus stage and get a better understanding of the product ecosystem, but groundbreaking innovation being delivered now including intelligent gift profile.
Ramesh Srinivasan: and get a better understanding of the product ecosystem.
Ramesh Srinivasan: The groundbreaking innovations being delivered now, including intelligent guest profile, single itinerary across multiple amenities for guests. Artificial Intelligence Based Revenue Upsale and Conversational Ordering Tools And the unique benefits the combined software modules can bring through operational efficiency and guest experience improvements. As more customers reach this product demonstration stage, the better our win ratios seem to get. Such sales opportunities are understandably considerably higher with customers who are already using at least one of our other products, who know us reasonably well, have a close view of our recent advancements, and trust us more.
Ramesh Srinivasan: Like maybe across multiple laminate piece for guess.
Ramesh Srinivasan: Artificial intelligence based revenue upsell and conversational marketing tools.
And the unique benefits of the combined software modules can bring through operational efficiency and guest experience improvements as more customers reach this product demonstration stage.
Ramesh Srinivasan: Our win ratios seem to get.
Ramesh Srinivasan: Such sales opportunities are understandably considerably higher with customers, who are already using at least one of our other products, who know it reasonably well.
Ramesh Srinivasan: Close view of our recent advancements and trust us more.
Ramesh Srinivasan: Yeah.
Ramesh Srinivasan: One quick comment on our Inspire User Conference held a couple of weeks ago at Hilton Austin, Texas. It didn't seem like it was our best one yet, with the main highlight being eight different customer-led sessions on main stage, including some of the biggest operator names in hospitality and covering the gamut of software solutions we offer, explaining the benefits they have gained recently from our accelerating product innovation.
Ramesh Srinivasan: One quick comment on our inspire user conference held a couple of weeks ago.
Ramesh Srinivasan: At Hilton in Austin, Texas.
Ramesh Srinivasan: It did seem like it was on a best one yet with the main highlights being eight different customer led sessions on main stage, including some of the biggest operator named in hospitality and commenting the gamete of software solutions we offer.
Ramesh Srinivasan: Explaining the benefits they have gained recently.
Ramesh Srinivasan: Accelerating product innovation.
Ramesh Srinivasan: Now, on to revenue and profitability. Fiscal 2025 fourth quarter revenue was a record $74.3 million. 19.4%, that is one line, 19.4% higher than the comparable prior year quarter. This was our 13th consecutive Record Revenue Quarter. Q4 subscription revenue of 29.8 million was a record and grew by 42.7% from the comparable prior year quarter. Q4 subscription revenue was also a record 64.4% of total recurring revenue. In absolute number terms, Q4 subscription revenue grew by $8.9 million year-over-year. which is the highest level of year-over-year growth we have seen until now. In addition, services revenue of $17.8 million, that is one-seventh, $17.8 million was also a record.
Ramesh Srinivasan: Now on to revenue and profitability.
Ramesh Srinivasan: Fiscal 2025 fourth quarter revenue was a record 73.7.
Ramesh Srinivasan: $74 3 million 19, 4% and that was one 919, 4% higher than the comparable prior year quarter.
Ramesh Srinivasan: This was our 13th consecutive record revenue quarter.
Q4 subscription revenue of $29 8 million was a record.
Ramesh Srinivasan: And grew by 42, 7% from the.
Ramesh Srinivasan: Comparable prior year quarter.
Ramesh Srinivasan: Q4 subscription revenue was also a record 64, 4% of total recurring revenue.
Ramesh Srinivasan: In absolute numbers.
Ramesh Srinivasan: Q4 subscription revenue grew by $8 9 million.
Ramesh Srinivasan: Year over year.
Ramesh Srinivasan: Which is the highest level of year over year growth, we have seen until now.
Ramesh Srinivasan: In addition, some.
Ramesh Srinivasan: Revenue of $17 8 million that is one $717 $8 million was also a record.
Ramesh Srinivasan: Fiscal 2025 Q4 was an excellent quarter of implementation execution by the professional service Apart from being a record quarter for services revenue, it was also a record quarter for the combined annual recurring revenue value of subscription revenue-based projects implemented in the We also made excellent progress with hiring for the professional services teams during the quarter, achieving our hiring goals and making up for the lack of progress during previous Q2 and Q3. We have now set ourselves up well for continued good progress with project deployment.
Ramesh Srinivasan: Fiscal 2025, Q4 was an excellent quarter of implementation execution by the professional services teams.
Ramesh Srinivasan: Apart from being a record quarter for services revenue. It was also a record quarter for the combined.
Ramesh Srinivasan: Recurring revenue value.
Ramesh Srinivasan: Our subscription revenue base projects implemented them defeat.
Ramesh Srinivasan: We also made excellent progress with hiring for the professional services teams during the quarter, achieving our hiring goals and making up for the lack of progress building previous Q2 and Q3.
Ramesh Srinivasan: We have now set ourselves up well for continued good progress with project deployments.
Ramesh Srinivasan: Despite all that breadth and depth of implementation success during the quarter The sum of product, services, and recurring revenue backlog again grew to record levels because it was an even better sales success quarter. Product backlog consisting of perpetual licensed software and hardware resold but yet to be shipped. improved greatly during the quarter but was still at only about 60 percent, 6-0, about 60 percent of previous peak levels as of March end.
Ramesh Srinivasan: Despite all of the breadth and depth of implementation success during the quarter.
Ramesh Srinivasan: Some of products services and recurring revenue backlog again grew to record levels because it wasn't even better sales tax this quarter.
Ramesh Srinivasan: Product backlog, consisting of perpetual license software and hardware resort, but yet to be shipped.
Ramesh Srinivasan: Improved greatly during the quarter.
Ramesh Srinivasan: But it was still at only about 60% 60% of previous peak levels as of March end.
Ramesh Srinivasan: The decreasing sales trend for perpetual software licenses and hardware Keeping product backlog at reduced levels is not entirely unexpected and serves as confirmation of the continuing transformation of this business into a cloud and subscription-based enterprise software engine. Full fiscal 2025 revenue was a record $275.6 million. 16% higher than the previous year, despite a 16% decline in one-time product revenue consisting of perpetual software licenses and hardware resolvers. Fiscal 2025 revenue included $170.1 million in recurring revenue. 23.2% higher than the previous year. Full Fiscal Year 2025 Subscription and Services Revenue where both records and 39.5% and 27.7% respectively higher than the previous.
Ramesh Srinivasan: The decreasing sales trends for perpetual software licenses and hardware Keith.
Ramesh Srinivasan: Keeping product backlog at reduced level is not entirely unexpected.
Ramesh Srinivasan: It serves as a confirmation of the continuing transformation of this business into our cloud and subscription based enterprise software activity.
Ramesh Srinivasan: Full fiscal 'twenty 'twenty five revenue was a record $275 6 million.
Ramesh Srinivasan: 16%, there was one 616% higher than the previous year. Despite a 16% one six again, 16% decline in onetime product revenue consisting of perpetual software licenses and hardware resold.
Ramesh Srinivasan: Fiscal 2025 revenue included 171 that is 100 701 $71 million in recurring revenue.
Ramesh Srinivasan: 23, 2% higher than the previous year.
Ramesh Srinivasan: For fiscal year 2020 by subscription and services revenue were both records.
Ramesh Srinivasan: And 39, 5% and 27, 7%, respectively higher than the previous years.
Ramesh Srinivasan: Fiscal 2025 was the fourth consecutive year. with year-over-year overall subscription revenue growth of at least 27%. and organic subscription revenue growth of at least 25%.
Ramesh Srinivasan: Fiscal 2025 was the fourth consecutive years.
Ramesh Srinivasan: Year over year overall subscription revenue growth of at least 27%.
Ramesh Srinivasan: And organic subscription revenue growth of at least 25%.
Ramesh Srinivasan: Shifting the focus to fiscal 2026. We expect only limited growth in the one-time product revenue line this year. one-time product revenue, which used to be about 25% of our total revenue a few years ago. had now reduced to 15% of total revenue during fiscal 2025.
Ramesh Srinivasan: Shifting our focus to fiscal 2026.
Ramesh Srinivasan: We expect only limited growth in the onetime product revenue line this year.
Ramesh Srinivasan: Once that product revenue, which used to be about 25% of our total revenue a few years ago.
Ramesh Srinivasan: No that used to 51, 515% of total revenue during fiscal 2025.
Ramesh Srinivasan: With respect to tariffs, we expect limited direct effects on our business, if any. Reselling of hardware has now reduced greatly to only a bit more than 10% of total revenue. Further, and perhaps the most important detail, is that the POS platform has been modernized completely. making it more open and easily adaptable to various kinds and makes of terminal hardware. giving us additional flexibility to manage the supply chain across multiple vendor parties.
Ramesh Srinivasan: Because I think that pattern.
Ramesh Srinivasan: We expect limited very fixed on that business if any.
Ramesh Srinivasan: Reselling of hardware has now that he was greatly to only a bit more than 10% of total revenue.
Ramesh Srinivasan: Further and perhaps the most important debate is that the platform has been modernized completely making it more open and easily adaptable to various kinds and makes of terminal hardware, giving.
Ramesh Srinivasan: Giving us additional flexibility to manage the supply chain across multiple vendor partners.
Ramesh Srinivasan: While macroeconomic headlines give us some caution for the second half of fiscal 2026. We have a lot of reasons to remain bullish on our progress, regardless of the macro circumstances. Given our relative small size compared to the humongous, total addressable hospitality market and the recent progress we have made with the modernized solutions and the additional competitive ecosystem advantages we have created for ourselves. Duplicating our modern, cloud-native ecosystem of software solutions is not going to be easy for other technology vendors in hospitality. This is about as good a barrier to entry. Or, let's call it, as good a barrier to excel as it can be.
Ramesh Srinivasan: While macroeconomic headlines give us some caution for the second half of fiscal 2026, we have a lot of reasons to remain bullish on our progress regardless of the macro circumstances, given a relative small size compared to the humongous total addressable hospitality market and the recent probe.
Ramesh Srinivasan: Yes, we have made with the modernized solutions and the additional confidence ecosystem advantages, we have created for ourselves.
Ramesh Srinivasan: Duplicating, our modern cloud native ecosystem of software solutions is not going to be easy, but other technology vendors in hospitality.
This is about as good a barrier to entry.
Speaker Change: Oh, let's call it a good a barrier to excel as it gets.
Ramesh Srinivasan: We will continue to make all the required investments across various business areas to fuel future revenue growth, including in Information Security, Product Cyber Security, Sales, Marketing, Services, Customer Support, Cloud Infrastructure, Artificial Intelligence and Product Innovation. We are not going to sacrifice any of our medium-term and long-term revenue growth possibilities for the sake of short-term profitability. We will continue to remain disciplined with growth, growing profitability steadily while remaining ambitious with medium and long term top line growth plans.
Speaker Change: We will continue to make all of the required investments across various business areas to fuel future revenue growth, including in information security Parotic Cyber security sales marketing services customer support cloud infrastructure.
Speaker Change: Initial intelligence and product innovation.
Speaker Change: We are not going to sacrifice any of our medium term and long term revenue growth possibilities for the sake of short term profitability increases.
Speaker Change: We will continue to remain disciplined with growth growing profitability steadily while remaining ambitious with medium and long term topline growth plans.
Ramesh Srinivasan: Given all that... We expect full year fiscal 2026 revenue to be in the range of $308 million to $312 million. driven among other factors. by year-over-year subscription revenue growth of 25%. We also expect adjusted EBITDA to be 20% of revenue for the year.
Speaker Change: Yeah.
Speaker Change: Given all of that being.
Speaker Change: We expect full year fiscal 2026 revenue to be in the range of 308 million to $312 million driven among other factors.
Speaker Change: By year over year subscription revenue growth of 25%.
Speaker Change: We also expect adjusted EBITDA to be 20% of revenue for the year.
Ramesh Srinivasan: Despite continuing good progress by all parties involved in the massively transformational Marriott PMS project We have assumed no material subscription revenue contribution from this project in our projections and guidance for Fiscal 2020.
Speaker Change: Despite continuing good progress by all parties involved in the massively transformation of Marriot BMS project.
Speaker Change: We have assumed no material subscription revenue contribution from this project in our predictions and guidance for fiscal 2026.
Dave Wood: With that, let me hand over the call to Dev for further colour on our financial and operational... Thank you, Ramesh. Taking a look at our financial results, beginning with the income statement, fourth quarter fiscal 2025 revenue was a quarterly record of $74.3 million. a 19.4% from total net revenue of $62.2 million in the comparable prior year. one-time revenue consisting of product and professional service was up 9.5% over the prior year quarter, while recurring revenue was up 26.3% over the prior As a result of the continued momentum in our business, we are pleased to see 16.1% total revenue growth compared to fiscal year 2021.
Speaker Change: With that let me hand over the call to be for further color on our financial and operational success.
Speaker Change: Yep. Thank you Ramesh.
Speaker Change: Taking a look at our financial results beginning with the income statement fourth quarter fiscal 2025 revenue was a quarterly record of $74 3 million and.
Speaker Change: <unk> 19, 4% increase from total net revenue of $62 2 million in the comparable prior year period.
Speaker Change: Onetime revenue consisting of product and professional services was up nine 5% over the prior year quarter, while recurring revenue was up 26, 3% over the prior year quarter.
Speaker Change: As a result of the continued momentum in our business. We are pleased to see 16, 1% total revenue growth compared to fiscal year 2024th during.
Dave Wood: During fiscal 2025 compared to the previous year, professional services increased by 27.7%. and Recurring Revenue increased 23.5%.
Speaker Change: During fiscal 2025 compared to the previous year professional services increased by 27, 7%.
Speaker Change: Recurring revenue increased 23, 2%.
Dave Wood: Overall, FR25 came with its share of operational challenges as we continue to implement and transition to the new product. However, sales of these new solutions during the year performed well, especially in Q4, with record sales levels to end. It was nice to see our POS sales back to healthy levels during fiscal Q4 FY25. up 23% over the prior year Q4 FY24. 28% over the sequential prior course. We are confident we have now moved past the volatility in POS sales and expect to see continued POS growth moving forward. Professional services and subscription sales exit the year at record levels as well.
Speaker Change: Overall FY 'twenty five came with its share of operational challenges as we continue to implement and transitioned to the new products.
Speaker Change: However sales of these new solutions during the year performed well, especially in Q4 with record sales levels to end the year.
It was nice to see our pass sales back to healthy levels during fiscal Q4, FY 'twenty five.
Speaker Change: Up 23% over the prior year Q4, FY 'twenty four and.
Speaker Change: 28% over the sequential prior quarter.
Speaker Change: We are confident we have now moved past the volatility.
POS sales and expect to see continued Pos growth moving forward.
Speaker Change: Professional services and subscription sales exited the year at record levels as well.
Dave Wood: As such, we are exiting the year with a materially larger backlog, up 26% over fiscal year 2024-2021. Professional services increased 21.7% over the prior year quarter, to a record 17.8%. Despite the record professional services revenue, our services backlog increased and remained at record levels on the back of record services sales during the quarter and fiscal year. Total recurring revenue represented 62.2% of total net revenue for the fiscal fourth quarter and 61.7% for the full year, compared to 58.8% and 58.1% of total net revenue in the fourth quarter and full year fiscal 2020. We continue to be pleased with subscription sales and revenue.
Speaker Change: As such we are exiting the year with a materially larger backlog up 26% over fiscal year 2020 for exit.
Speaker Change: Professional services increased 21, 7% over the prior year quarter to a record $17 8 million.
Speaker Change: Despite the record professional services revenue our services backlog increase and remained at record levels on the back of record services sales during the quarter and fiscal year.
Speaker Change: Total recurring revenue represented 62, 2% of total net revenue for the fiscal fourth quarter and 61, 7% for the full year compared to $58 eight and 58, 1% of total net revenue in the fourth quarter and full year fiscal 2020.
Speaker Change: Before.
Speaker Change: We continue to be pleased with subscription sales and revenue growth levels.
Dave Wood: The subscription revenue grew 42.7% for the fourth quarter of fiscal 2025 and 39.5% for the full fiscal year. Organic subscription growth was 22.2% for the quarter and 25.3% for the full fiscal year.
Speaker Change: Subscription revenue grew 42, 7% for the fourth quarter of fiscal 2025, and 39, 5% for the full fiscal year.
Speaker Change: Organic subscription growth was 22, 2% for the quarter and 25, 3% for the full fiscal year.
Dave Wood: The description, sales, and backlog have us set up well for our FY21. Moving down the income statement, gross profit was $45.1 million, compared to $38.3 million in the fourth quarter of fiscal year 2018. Gross profit margin was 60.7% compared to 61.5% in the fourth quarter of fiscal 2024, mostly due to product mix changes during the For the fiscal year, Gross Margin was 62.4%. compared to 60.7% in the prior year. The full year increase in gross margin is mostly due to increases in recurring revenue, which now represent 61.7% of revenue compared to 58.1% of revenue in fiscal year 2020.
Speaker Change: Subscription sales and backlog have a setup well for our FY 'twenty six plan.
Speaker Change: Moving down the income statement gross profit was $45 1 million compared to $38 3 million in the fourth quarter of fiscal 2024 gross profit margin was 67% compared to 61, 5% in the fourth quarter of fiscal 2024, mostly due to product.
Speaker Change: Mix changes during the quarter.
Speaker Change: For the fiscal year gross margin was 62, 4% compared to 67% in the prior year period.
Speaker Change: Full year increase in gross margin is mostly due to increases in recurring revenue, which now represents 61, 7% of revenue compared to 58, 1% of revenue in fiscal year 2024.
Dave Wood: Combine the three main operating expense line items, product development, sales and marketing, and general and administrative expenses. for 41% of revenue. fiscal 2025 fourth quarter, compared to 43.9% of revenue. prior year quarter and ahead of our FY25. Excluding stock-based compensation, for the full fiscal year 2025, product development decreased to 19% compared to 20.8% of revenue in the prior fiscal year. General and Administrative reduced slightly for the year from 12.8% to 12.6%. Sales and marketing decreased slightly from 11.6% of revenue to 11.4% of revenue, mostly due to timing.
Speaker Change: Combined the three main operating expense line items product development sales and marketing and general and administrative expenses when excluding stock based compensation.
Speaker Change: We're 41% of revenue in the fiscal 2025 fourth quarter compared to 43, 9% of revenue.
Speaker Change: In the prior year quarter and ahead of our FY 'twenty plan.
Speaker Change: Excluding stock based compensation for the full fiscal year 2025 product development decreased to 19% compared to 28% of revenue in the prior fiscal year general and administrative expenses reduced slightly for the year from 12, 8% to 12, 6% of revenue.
Speaker Change: Sales and marketing decreased slightly from 11, 6% of revenue to 11, 4% of revenue, mostly due to timing of events.
Dave Wood: We've combined the three main operating expense line items, product development, sales and marketing. including stock-based companies. were 43% of revenue this fiscal year, compared to 45.2% of revenue in FY20. Operating income for the fourth quarter of $5.3 million, net income of $3.9 million. gained per diluted share of 14... are higher than the prior year's fourth quarter gain of 3.5 million, 3 million, and 11. Adjusted Net Income, normalizing for certain non-cash and non-recurring charges of $15.2 million, compares favorably to Adjusted Net Income of $9 million in the prior year fourth quarter. And Adjusted Diluted Earnings Per Share of $0.54 compares favorably to $0.35.
Speaker Change: Combined the three main operating expense line items product development sales and marketing and general and administrative expenses, excluding stock based compensation were 43% of revenue this fiscal year compared to 45, 2% of revenue in FY 'twenty four.
Speaker Change: Operating income for the fourth quarter of $5 3 million net income of $3 9 million and gain per diluted share of <unk> 14.
Speaker Change: Our higher than the prior year's fourth quarter gain of $3 5 million $3 million and 11%.
Speaker Change: Adjusted net income normalizing for certain noncash and nonrecurring charges of $15 2 million compares favorably to adjusted net income of $9 million in the prior year fourth quarter and adjusted diluted earnings per share of <unk> 54 compares favorably to 32.
Dave Wood: For the 2025 fourth quarter, adjusted EBITDA was $14.8 million compared to $11 million in the year ago. for the full year fiscal 2025 adjusted even it was $53.8 million compared to $37.4 million. We are pleased to see our profitability levels end up well ahead of the original FY25 plan with adjusted EBITDA coming in at 19.5% of profit.
Speaker Change: For the 2025 fourth quarter, adjusted EBITDA was $14 8 million compared to $11 million in the year ago quarter.
Speaker Change: For the full year fiscal 2025, adjusted EBITDA was $53 8 million compared to $37 1 million were.
We are pleased to see our profitability levels and up well ahead of the original FY 'twenty five plan with adjusted EBITDA coming in at 19, 5% of revenue.
Dave Wood: Moving to the balance sheet and cash flow statement, cash and marketable securities as of March 31, 2025 was $73 million compared to $144.9 million on March 31, As a reminder, We hope to utilize $100 million in cash for the Book for Time acquisition in August, along with utilizing $50 million on our credit revolve. We have paid off $26 million of the revolver by March 31st, and since the end of the fiscal year we have paid an additional $12 million against the outstanding debt. As it relates to free cash flow, we are pleased to see an increase for the full fiscal year.
Speaker Change: Moving to the balance sheet and cash flow statement cash and marketable securities as of March 31, 2025, who was $73 million compared to $144 9 million on March 31, 2024, as a reminder, we utilized $100 million of cash for the book for time acquisition in August along with utilizing 50.
On our credit revolver.
We have paid off $26 million of the revolver by March 31.
Speaker Change: Since the end of the fiscal year, we have paid an additional $12 million.
Speaker Change: The outstanding debt balance.
Speaker Change: As it relates to free cash flow, we are pleased to see an increase for the full fiscal year <unk>.
Dave Wood: Free cash flow in the quarter was $26.5 million. $29.3 million in the prior year quarter and $52.3 million for the full fiscal year compared to $40.1 million in the prior year quarter. As we've said in the past, adjusted even in free cash flow, after normalizing the impact of CapEx, continue to be good proxies for health of the public. Full fiscal year 2025 free cash flow was slightly less than adjusted. due to capital expenditures offset by timing of working capital.
Speaker Change: Free cash flow in the quarter was $26 5 million compared to $29 3 million in the prior year quarter and $52 3 million for the full fiscal year compared to $40 1 million in the prior year.
Speaker Change: As we've said in the past adjusted EBITDA free cash flow after normalizing the impact of Capex continued to be good proxy for health of the business.
Speaker Change: Full fiscal year 2025 free cash flow was slightly less than adjusted EBITDA due to capital expenditures offset by timing of working capital adjustments.
Dave Wood: for fiscal year 2020. We expect revenue to be in the $308 to $312 million range, excluding any material upside from the upcoming large PMS rollout. We expect product revenue to increase by 5-10% over FY20. Professional services should grow in the range of 5% to 10% Recurring revenue will continue to grow around 15% with subscription growth of 25%. Adjusted EBITDA will increase moderately to 20% of revenue as we continue to invest in growth-related initiatives and large customers before receiving subscription.
Speaker Change: For fiscal for fiscal year 2026, we expect revenue to be in the $308 to $312 million range, excluding any material upside from the upcoming large pms rollout.
Speaker Change: We expect product revenue to increase by 5% to 10% over fiscal year 2024.
Speaker Change: Professional services should grow in the range of 5% to 10% as well.
Speaker Change: Recurring revenue will continue to grow around 15% with subscription growth of 25%.
Speaker Change: Adjusted EBITDA will increase moderately to 20% of revenue as we continue to invest in growth related initiatives and large customers before receiving subscription revenue.
Dave Wood: In closing, we are pleased with our 2025 financial results and the solid business fundamentals for future revenue.
Speaker Change: In closing we are pleased with our 2025 financial results and the solid business fundamentals for future revenue growth.
Dave Wood: With that, I will now turn the call back over to Thank you, Dave.
Ramesh Srinivasan: With that I will now turn the call back over to Ramesh.
Ramesh Srinivasan: In summary, the last few years of this massive business transformation phase have been difficult to state it mildly. All such massive transformations are difficult to accomplish while keeping the business not just running but also growing with improving profitability. Carrying customers along the path of a generational change in how POS and PMS systems are run has worked out well by any reasonable measure, but the process has not been without its challenges. Despite all the difficult challenges managing a couple of revenue J-curves and other quantum leap progress steps, In the three years since fiscal year ended March 2022 We have increased annual revenue.
Ramesh Srinivasan: Thank you Dave.
Ramesh Srinivasan: In summary, the last few years of this massive business transformation phase have been difficult to state it mildly.
Ramesh Srinivasan: All such massive transformation, that's difficult to accomplish while keeping the business not just running but also growing with improving profitability levels.
Ramesh Srinivasan: Carrying customers along the path of a generational change in <unk> P. M. P O S and BMS systems I've run has worked out well by any reasonable measure.
Ramesh Srinivasan: But the process has not been without its challenges.
Ramesh Srinivasan: Despite all the difficult challenges managing a couple of revenue J curves and other quantum leap progress steps.
Ramesh Srinivasan: In the three years since this could be a ended March 2022.
Ramesh Srinivasan: We have increased annual revenue.
Ramesh Srinivasan: By $113 million, that is $113 or 70% 7-0. and Subscription Revenue by $60,000,000 or $130,000. So let me repeat that. In the last three years, since March 2022, we have increased annual revenue by $113 million or 70% and subscription revenue by $60 million or 130%.
Ramesh Srinivasan: By $113 million that is 113.
Ramesh Srinivasan: Our 70% seven zero.
Ramesh Srinivasan: And subscription revenue by $60 million, six zero or 130% 130, So let me repeat that.
Ramesh Srinivasan: In the last three years since March 2022.
We've increased annual revenue by $113 million, or 70% and subscription revenue by $60 million or 130%.
Ramesh Srinivasan: And we are only getting started now. For much of the hospitality industry, we are still a story that is hiding in plain sight. especially in the international region. which is unfortunate but okay. It gives us a solid good growth path ahead. During the recent six months, we have significantly expanded our sales teams, especially in the hotels and resorts vertically. and expanded the services team. Attracting leadership, sales, and other talent from other highly rated hospitality technology providers. 1,300 plus installations in the field, featuring only the modernized solutions, and this count is rapidly expanding, carrying with it the unmistakable message that this is not your grandfather's or father's Agilysys anymore, and we are now a hospitality technology force that has to be reckoned with.
Ramesh Srinivasan: And we are only getting started now.
Ramesh Srinivasan: For much of the hospitality industry, we have still a story that is heightening in plain sight.
Ramesh Srinivasan: Especially in international regions.
Ramesh Srinivasan: It is unfortunate but okay. It gives us a solid good growth path ahead.
Ramesh Srinivasan: During the recent six months, we have significantly expanded our sales teams, especially in the hotels and resorts vertical.
Ramesh Srinivasan: And expanded the services teams.
Ramesh Srinivasan: Attracting leadership sales some other talent from other highly rated hospitality technology providers.
Ramesh Srinivasan: Hi.
Ramesh Srinivasan: 1300, plus installations in the field featuring only the modernized solutions and discount is rapidly expanding carrying with it the unmistakable message that this is not your grandfather was a father of atlas's anymore and we have in our hospitality technology force that has to be reckoned with.
Ramesh Srinivasan: An increasing number of hospitality corporations are now seeing in us the kind of end-to-end ecosystem technology providers with true modern and connected solutions they have always wanted. and we are well positioned for a bright future.
Ramesh Srinivasan: An increasing number of hospitality corporations are now seeing in us that kind of end to end ecosystem technology provider.
Ramesh Srinivasan: Through modern and connected solutions they have always wanted.
Ramesh Srinivasan: And we are well positioned for a bright future.
Ramesh Srinivasan: It is tough not to be bullish about our future prospects.
Ramesh Srinivasan: If it's stuff not to be bullish about our future prospects.
Operator: With that, Carmen, let's open up the call for questions, please. Thank you so much. And as a reminder, if you do have a question, simply press star 1-1 to get in the queue and wait for your name to be announced. To remove yourself, press star 1-1 again. Thank you. One moment for our first question.
Speaker Change: With that Carmen, let's open up the call for questions. Please. Thank you so much and as a reminder, if you do have a question simply press star one wanted to get in the queue and wait for your name to be announced to remove yourself press star. One again. Thank you one moment for our first question.
Stephen Sheldon: Any calls from Stephen Sheldon with William Blair, please proceed. Hey, thanks for taking my questions. Just first one here on the POS bookings, it sounds like you saw much more success there this quarter, including I think you noted a pickup in the managed food service vertical. So just curious what you attribute that to? How much is being driven by better execution or improvement with specific customers versus how much is just generally a better backdrop, if at all?
Stephen Sheldon: And it comes from Stephen Sheldon with William Blair. Please proceed.
Stephen Sheldon: Hey, Thanks for taking my questions.
Stephen Sheldon: Just first one here on the Pos bookings it sounds like.
Stephen Sheldon: You saw a much more success there this quarter.
Stephen Sheldon: I think you noted a pickup in the managed foodservice verticals. So I'm just curious what you attribute that to how much is being driven by better execution or improvement with specific customers versus how much is just generally a better backdrop if at all.
Ramesh Srinivasan: Yeah, hi Steven. I would say the improvement is because for the last year or so, just short of a year, we've only been installing the newer version. Now the newer version is not only fully modernized Steve, but is also completely unified. Meaning guest facing and staff facing feature sets are now on one unified POS platform. And we are about the only vendor, only major vendor in this industry that provides a unified platform. So modernized and unified, it's a lot easier to implement. And those are the only implementations we are doing for the most part for the last year or so.
Steven: Yeah, Hi, it's Steven.
Steven: I'd say the improvement is because for the last year or so this short of a year.
Steven: We've only been installing the new in Russia now.
Steven: The new in Washington is not only fully modernized Steve but is also completely unified.
Steven: Meaning guest facing and.
Steven: And staff facing feature sets are now on one unified platform and we are about the only window. The only major amendment in this industry that provides a unified platform.
Steven: So a modernized and unified it's a lot easier to implement and those are the only implementations. We are doing for the most part for the last year or so.
Ramesh Srinivasan: And that is now improving our status as a premium POS provider. And we are now the wanted product.
Steven: That is now improving our status as a premium provider and we have now the wanted product.
Ramesh Srinivasan: What happened before that was it got a little bit complicated because we were trying to transform from old to new. And a lot of the implementations became a combination of old and new, and these are two generations of technology. So, I think we have turned the corner now, the Q4 momentum is not going to be a one time thing, it is going to continue now, and hands down, these are the best, this is the best POS platform out in the field now, and we expect this momentum to continue.
Steven: What happened before that once it got a little bit complicated because we were trying to transform from old to new and a lot of implementations became a combination of old and new and these are two generations of technologies. So I think we have turned the corner now.
Steven: Q4 momentum is not going to be a one time thing. It is going to continue now and hands down. These are these are the best this is the best platform out in the out in the field now and we expect this momentum to continue.
Stephen Sheldon: Got it, that's good to hear.
Speaker Change: Got it that's good to hear.
Stephen Sheldon: On the implementation side, can you just update us on the mix of customers using Agilysys implementation teams versus using third-party support from SIs, etc.
Steven: On the implementation side.
Speaker Change: Can you just update us on the mix of customers using it.
Speaker Change: Jealousy implementation teams versus using third party support from outside et cetera do.
Ramesh Srinivasan: Do you expect that mix to evolve at all over time and is that playing at all into, I think Dave, you mentioned five to ten percent expected revenue growth for professional services this year or in fiscal 2026. Is that playing into that guidance at all? I don't think so Steve, most of our implementations are done by our team. Because these are complex implementations, and you have a 1,500 person R&D team that is driving innovation forward. So in terms of keeping even our own teams trained and up to speed on the newer versions is not easy.
Do you expect that mix to evolve at all over time and is that playing at all into I think Dave you mentioned, 5% to 10% expected revenue growth for professional services this year or in fiscal 2020 is that playing into that.
Speaker Change: Our guidance at all.
Speaker Change: I don't think so Steve Moore still far implementations.
Speaker Change: <unk> done by our teams because these are complex implementations and do you have a 1500 person R&D team that is driving innovation forward. So in terms of keeping even our own teams trained and up to speed on the newer version is not easy it's very difficult doing it for external si's.
Ramesh Srinivasan: It's very difficult doing it for external SIs.
Ramesh Srinivasan: So our implementations, for the most part, are done by our team. Now the 5-10% growth has to do with the fact that Part of our services revenue, we have customer paid R&D efforts as well. And as we become bigger, these customer-paid R&D efforts will be there, based on my experience of three decades in enterprise software, but they can't be predicted quarter to quarter. So this is normal services revenue growth that we are seeing, but we do it with our own resources.
Speaker Change: Our implementations for the most part.
Speaker Change: It's done by our teams.
Speaker Change: No the 5% to 10% growth has to do with the fact that.
Speaker Change: Part of our services revenue, we have customer paid RMB FX as well.
Speaker Change: And as we become bigger these customer paid RMB efforts will be there based on my experience of three decades in enterprise software, but they can't be predicted quarter to quarter.
Speaker Change: So this is normal services revenue growth that we are seeing but we do it with our own resources in this kind of complex enterprise software business. It is not easy handing things over to external sites.
Stephen Sheldon: In this kind of complex enterprise software business, it is not easy handing things over to external entities. Got it. That makes sense.
Speaker Change: Got it.
Stephen Sheldon: And then just one last one for me. Just curious with the 2026 guidance. Subscription revenue in particular, what does that imply for organic subscription revenue growth? I think just roughly ballparking it, we're calculating high teens. Is that right? And just any sense on what you baked in for organic growth on the subscription side between POS and PMS solutions? Any additional context there would be helpful.
Speaker Change: Makes sense and then just one last one for me just curious with the 2026 guidance.
Speaker Change: Our subscription revenue particular, what does that what does that imply for organic subscription revenue growth.
Speaker Change: Just roughly ballpark you know we kind of.
Speaker Change: For calculating high teens.
Speaker Change: Is that right and just any sense on what you baked in for organic growth on the subscription side between Pos and Pms solutions any additional context, there would be helpful.
Ramesh Srinivasan: Yeah, so we typically don't break out the point of sale and property management subscription growth. I mean, I think we're at a point where they're both as Ramesh just talked a lot about both products are ready and we're kind of past the point of sale challenges. I mean, we certainly expect PMS to be a higher growth percentage just because it's coming from a lower base. But point of sale is back to growing in line with where where it's growing. But to answer your question, I mean, the 25% growth includes about four months of benefit from the book for time acquisition.
Speaker Change: Yes, so we typically don't breakout of point of sale and property management subscription growth I mean, I think we're at a point where they are both <unk>.
Speaker Change: <unk> talked a lot about both products are ready and we're kind of past the point of sale challenges I mean, we certainly expect pms to be a higher growth percentage is because it's coming from a lower base, but point of sale is back to growing in line with where where it's grown in the past.
Speaker Change: But to answer your question I mean, the 25% growth includes about four months of benefit from the book per time acquisition. So we would be in.
Ramesh Srinivasan: So we would be in the, you know, closer to the 22, 23% range. We wouldn't be in the...
Speaker Change: Closer to the 22, 23% range, we wouldn't be in the teens.
Stephen Sheldon: from an Aguirre-Targana Okay, great, thank you.
Speaker Change: From an organic standpoint.
Okay, great. Thank you.
Stephen Sheldon: Thank you.
Speaker Change: Thank you.
Sam Salvas: Our next question comes from the line of Sam Salvas with Medium & Company. Please proceed. Hey, thanks guys.
Speaker Change: Our next question comes from the line of Sam <unk> with Needham <unk> Company. Please proceed.
Sam Salvas: I'm just jumping on from Mayank tonight. Good to see the nice results here.
Hey, Thanks, guys I'm, just jumping on for Brian Tonight.
Speaker Change: Good to see the nice results here.
Ramesh Srinivasan: I wanted to touch on the momentum you're seeing in add-on sales. Could you guys talk about what's driving the improvement here and also maybe talk about which products you're seeing the strongest adoption rates? Yeah, hi, Sam. So in terms of add-on modules, they add a lot of value to the core product. So no one else has really invested this much in hospitality software to create an ecosystem of products. And in general, the add-on modules add a lot of value on the PMS side, more value on the PMS side than the POS side, just because of the sheer number of add-on modules that are there, about 4-5 times more add-on modules on PMS than POS.
Speaker Change: Wanted to touch on the momentum you're seeing in add on sales could you guys talk about what's driving the improvement here and also maybe talk about which products you're seeing the strongest adoption rates.
Speaker Change: Yeah, Hi, Sam so in terms of add on modules, they add a lot of value to the core product.
Speaker Change: So no one else has really missed this much in hospitality software to create an ecosystem of products.
Speaker Change: And in general the add on modules add a lot of value on the BMS side, the more value on the BMS side on the <unk> side, just because of the sheer number of add on modules that had been about four five times more add on modules on Pms and Pos.
Ramesh Srinivasan: So together, it has created now an ecosystem. that customers can put to good use. So a customer can either buy it from seven or eight different vendors, or they can buy it from one vendor. You buy it from one vendor comes with a lot of advantages. Like there have been some implementations recently, Sam, where the customer needed a quick change to be done, but it involved three different products. And we could get the changes done in all the three different products. One of them is core PMS, and two of them are add-on modules of PMS. We could get all of that done in the next couple of months.
Speaker Change: So together.
Create didn't know and ecosystem.
Speaker Change: So that customers can put to good use so a customer can either buy it from seven or eight different vendors.
Speaker Change: They can buy it from one windows you buy it from one windows comes with a lot of advantages like there have been some implementations recently, Sam we have the customer needed a quick change to be done, but it involves three different products and we could get the changes done in all the three different projects one of them is called BMS.
Speaker Change: Two of them are add on modules of BMS, we could get all of that done in the next couple of months those all bring huge value to customers. So more and more customers that are buying this ecosystem connected modules and these add on modules get us good margins and together are even more valuable than the core products for us.
Ramesh Srinivasan: Those all bring huge value to customers. So more and more customers are buying the ecosystem connected modules and these add-on modules get us good margins and together are even more valuable than the core products. So to answer your question, most of the PMS add-on modules are adding great value to our bookings. And on the POS side, the add-on modules make it a unified architecture. So it is now a unified POS platform, and that by itself has great value.
Speaker Change: So to answer your question most of the Pms add on modules or adding great value to our bookings and on the <unk> site. They add on module to make it a unified architecture. So he doesn't know a unified platform and that by itself has great value. So yes, the add on modules are big.
Ramesh Srinivasan: So yes, the add-on modules are big contributors to our bookings.
Speaker Change: The strong bookings momentum.
Dave Wood: Okay, that's helpful. And then, just a quick one, Dave, I was wondering, just on the 26th guide, you gave some good commentary across the revenue streams. And I know you guys are excluding the big PMS rollout, but is there anything you could give us in terms of the quarterly cadence and, you know, anything we should be mindful of outside of the acquisition, of course, in terms of either the revenue cadence or margins? Yes, so, I mean, on the revenue cadence, I mean, everything will... It's pretty similar to what you've seen in the past, I mean, products and professional services, you know, could nominally go up or down on a given quarter like you would expect with one-time revenue.
Speaker Change: Okay. That's helpful.
Dave: And then just a quick one Dave I was wondering.
Speaker Change: Just on the 26th guide you gave some good commentary across the revenue streams.
Dave: Yes.
Dave: And I know you guys are excluding the big Pms rollout, but is there anything you could give us in terms of the quarterly cadence and anything we should be mindful of outside of the acquisition of course.
Dave: In terms of either the revenue cadence or margins.
Dave: Yes, so I mean on the revenue cadence I mean everything.
Dave: Pretty similar to what you've seen in the past.
Dave: Product and professional services.
Dave: Could nominally go up or down on any given quarter like like you would expect with one time revenue and then on the recurring revenue it's kind of similar to what you would expect I mean.
Dave Wood: And then on the recurring revenue, it's kind of similar to what you would expect.
Dave Wood: I mean, the numbers are just obviously getting a little bit bigger, and so there's likely a 1.3 to kind of 1.6 million dollar sequential increase a quarter is pretty much how the revenue is laying. And then on the profitability side, I mean, I think, you know, we're still in a bit of a transition year. So there's not going to be a ton of operating leverage in OPEX. You'll see some in. GNA will probably show a little bit of operating leverage, but that will likely be offset by sales and marketing just due to timing of some events that fell this fiscal year versus last year.
Dave: The numbers are just obviously getting a little bit bigger and so there is likely.
Dave: One three to one $6 million sequential increase a quarter is pretty much how the revenues laying out.
Dave: Then on the profitability side, I mean, I think we're still in a bit of a transition year. So there.
Dave: There's not going to be a ton of operating leverage in opex, you'll see some in.
Dave: G&A will probably show a little bit of operating leverage, but that will likely be offset by sales and marketing just due to timing of some events that fell this calendar year or this fiscal year versus last calendar year, so pretty much I mean, similar to what you've seen in the past with recurring being the biggest biggest driver in onetime Rev.
Dave Wood: So pretty much, I mean, similar to what you've seen in the past. recurring being the biggest driver and one-time revenue will tick up and down on the quarter. Yep. Okay. All right. Thanks, guys.
Dave: Tick up and down on a quarterly basis.
Dave: Yep, Okay, alright, thanks, guys.
Dave Wood: Thank you, sir. Thank you.
Speaker Change: Thank you Sir.
Brian Schwartz: Our next question comes from Brian Schwartz with. Oppenheimer. Please proceed. Thank you for taking my questions this afternoon.
Speaker Change: Thank you. Our next question comes from Brian Schwartz with.
Speaker Change: Opened hymer. Please proceed.
Speaker Change: Thank you for taking my questions. This afternoon, Ron match in terms of the P O S business and.
Brian Schwartz: Ramesh, in terms of the POS business and kind of the the modernizing of the install base, is there anything that you can do internally to accelerate the migrations of maybe your larger legacy POS customers to the newer cloud model? And then I have a follow up. Yeah, so hi, Brian. So in terms of the conversions, Brian, please keep in mind, many of the older customers are also on a subscription revenue basis. They are also in SaaS. So just because they're in an older platform doesn't necessarily mean they are on-premises. And many of them who are on-premises, even when they move to our modern solutions, might choose to be on the on-premises again.
Speaker Change: The the modernizing of the installed base is there anything that you can do internally to accelerate the migrations of maybe your larger legacy <unk> customers to the newer cloud model and then I have a follow up.
Speaker Change: Yeah, So hi, Brian So in terms of the conversions Brian Please keep in mind many of the older customers on all.
Speaker Change: Also on our subscription revenue basis Theyre also in SaaS. So just because you have it on all the platform doesn't necessarily mean they have.
Speaker Change: On premises and many of them are on premises, even when they move to a modern solutions might choose to be on the on premises again so.
Ramesh Srinivasan: So this is not so much in our hands. All of them are now aware that this is a modernized, unified platform. All of them are keen to move towards a new platform, but it will be in their timelines. And many of those customers, when they move to the new platform, might use that as an event to move from on-premises to cloud. All of those are possible, but the customers control the timelines, Brian.
Speaker Change: So this is not so much in our hands.
Speaker Change: All of them.
Speaker Change: That this is a modernized unified platform.
Speaker Change: All of them are keen to move towards a new platform, but it'll be in their timelines and many of those customers when they move to the new platform, Mike use that that didn't even add might use that as an event to move from on premise to cloud all of those are possible, but the customers control the timelines, but I am beyond the point.
Ramesh Srinivasan: Beyond the point, we cannot force them into the new POS platforms. But one good thing we are doing is when a customer comes with a request of some major enhancement request that they have on the older platform, we are telling them, sorry, customer, to get that enhancement, you have to move to the newer platforms. So that is beginning to happen. So we are doing less and less changes on the older versions. And that, by the way, helps our R&D be more effective as well, because we are reducing our investments on the older platforms and increasing it on the newer one.
Speaker Change: We cannot force them into the new platforms, but one good thing we are doing is when a customer comes with the request of some amazing enhancement requests that they have on the older platform, we're telling them Saudi customer to get that enhancement you have to move to the newer platforms. So that is beginning to happen. So we are doing less in <unk>.
Speaker Change: Less changes on the older versions and that's by the way it helps that RMB be more effective as well because we are reducing our investments on the older platforms and increasingly on the newer one so.
Ramesh Srinivasan: So we are doing a lot of things that push customers along this curve, and newer installs are only done on the newer ones. So all that is going on, but beyond the point, we can't push customers, Brian. We are, by nature, a customer-centric organization, so we have to let customers work out their pace. But they are now accelerating. More and more customers are converting, and more and more of them are converting the cloud as well. All that is happening, but we can't force a greater pace, Brian. Thank you.
Speaker Change: So we are doing a lot of things that push customers along this curve and new installs are only down on the newer ones. So all of that is going on but beyond the point, we can push customers bank. We are by nature, a customer centric organization. So we have to let customers workout that pace, but they don't know accelerating more and more customers.
Converting and more and more of them are converting the cloud as web all of that is happening, but we can't force the greater pace, Brian I don't think so.
Brian Schwartz: And then the follow-up question, Ramesh, I wanted to just ask you on maybe what the early readings are with the beta testing with Marriott, realizing, you know, we don't have any financial guidance there, but, you know, what are you seeing among these early beta testers? Is the value that's being created, is it achieving goals? Is there anything else that you can just share with us qualitatively on how the beta testing program is going on over at that large PMS opportunity? So yeah, so no change from our previous updates, Brian. The testing is going well. This is a transformational project, Brian.
Speaker Change: Thank you and then the follow up question <unk>.
Speaker Change: Wanted to just ask you on maybe what the early readings are with the beta test staying with Marriott I'm. Realizing you know we don't have any financial guidance. There, but you know what are you seeing among these early beta testers is the value that's being created is it achieving goals.
Speaker Change: Is there anything else that you can just share with us qualitatively on how the the beta testing program, that's going on over at that large P. M. S.
Speaker Change: Thanks.
Speaker Change: So yeah, so no change from our previous updates, but I and the testing is going well.
This is a transformational project Brian this is a difficult project for the customer it involves multiple vendors.
Ramesh Srinivasan: This is a difficult project for the customer. It involves multiple vendors, and they are transforming the entire face of what their users in their hotels use. And it's gone remarkably well so far. The deep testing, they are now deep into testing, and the testing is going well. But the test properties have not yet started. We are getting close to a few test properties getting installed. But one thing I will tell you, there was a recent conference that involved a lot of their property personnel, senior personnel from their properties. And all these products, including our PMS product, were shown there, and the feedback was remarkably good.
Speaker Change: Transforming the entire phase of what that is.
Speaker Change: Users embed hotels use and it has gone remarkably well so far.
Speaker Change: The deep testing they are now deep into testing and the testing is going well, but this properties have not yet started we are getting close to <unk>.
Speaker Change: Few desk properties, but getting installed but one thing I will tell you. There was a recent confidence that involved a lot of them properly personnel senior personnel from their properties and all of these products, including a BMS product was shown there and the feedback was remarkably good so that it's exact meant among their properties. They have waited for this.
Ramesh Srinivasan: So there is excitement among their properties. They have waited for this technology transformation for quite a long time. So all signals are good so far. The ecosystem testing, the end-to-end testing involving products across multiple vendors, all that is going well. And now that testing is moving to the beta testing that you're talking about of test properties. So, so far, so good, Brian. We should feel positive about this project. Always keep in mind, it's a very complex transformational technology project. So it is always good to be cautiously optimistic about it. But so far, so good.
Speaker Change: Technology transformation for quite a long time, so all signals are good so far the ecosystem testing the end to end testing involving products across multiple vendors all of that is going well and know that testing is moving to the beta testing that you are talking about Av test properties. So so far so good but I mean.
Speaker Change: Should feel positive about this project and we have to.
Speaker Change: Keep in mind, it's a very complex transformation of technology project. So it is always good to be cautiously optimistic about it but so far so good play.
Dave Wood: And then the one question I have for Dave is, in terms of the line item guidance, specifically with the product line items, is there any way of how to share how you're thinking about that, you know, say over a multi-year period? You know, clearly the comps are going to be easier on that line this year, but do you think that that business has stabilized and, you know, sustaining just growth in general is achievable for the products line? Thanks. Yeah, no, we think, I mean, I think we talked about it a lot during fiscal year 25, where that was kind of resetting with the less, you know, the lesser attach rate on the new modernized solution.
Speaker Change: And then the one question I have for Dave is.
Speaker Change: In terms of the line item guidance specific way with with the product line.
Speaker Change: The line items is there any way of how to share how you're thinking about that you know say over a multi year period, you know clearly the comps are going to be zero.
Speaker Change: On that line this year, but do you think that that business has stabilized and sustaining.
Speaker Change: This growth in general is achievable for the products line. Thanks.
Speaker Change: Yeah, No. We think I mean, I think we've talked about it a lot during fiscal year 'twenty five of that was kind of resetting with the less.
Speaker Change: Essar attach rate on the new modernized solution. So we feel like that line has stabilized and it's probably not going to grow with top line in the out years, but we do look at it as kind of a.
Dave Wood: So we feel like that line is stabilized, and it's probably not going to grow with top line in the out years, but we do look at it as kind of a, in the call it medium term, a single digit type grower.
Speaker Change: In the call it medium term a single digit type grower.
Operator: Thank you for taking my questions. Thank you Brian. Thank you and as a reminder that is star 11 if you do have a question.
Speaker Change: Thank you for taking my questions.
Speaker Change: Thank you Brian.
Thank you and as a reminder, that is star one one <unk> do have a question.
Speaker Change: Yeah.
Nehal Chokshi: The last question I see is from Nehal Chokshi with Northland Capital Markets. Please proceed. Yeah, thank you, and good to hear that point of sales has turned the corner here. Ramesh, you talked about the DemoPlus pipeline, I think, second quarter in a row. I think in the December quarter, you said it was up 22% year-over-year. I believe you said it was up 18% year-over-year for the March quarter. So, is this a 20% or so growth rate at which DemoPlus pipeline, is that the right rate to be thinking about how that pipeline should be growing going forward?
Speaker Change: The last question I see from now Chuck <unk> with Northland Capital markets. Please proceed.
Speaker Change: Yeah. Thank you and good to hear that point of sales.
Speaker Change: Turning to pipe so it's turned the corner here.
Speaker Change: For him as he talks about the demo pipeline I think second quarter in a row.
Speaker Change: Several quarter, you said it was up 22% year over year I believe you said it was up 18% year over year March quarter. So is this a 20% or so grocery English double plus pipeline.
Speaker Change: Is that the you know.
Speaker Change: Right right to be thinking about how that pipeline should be growing going forward.
Ramesh Srinivasan: At the moment, Nehal, yes. As things stand now, assuming a 20% steady growth in the pipeline is a good thing to assume. But I'm optimistic that it will improve. One of the reasons is things are improving internationally for us, especially among the multi-amenity, higher-end resorts. There's less and less competition because we have invested and created an ecosystem of products that our competition just hasn't. I mean, it is not much more complicated than that because when you want a fully connected system and you're running a multi-amenity resort, there are not that many players out there. So that's one reason why I'm optimistic the sales pipeline will increase.
Speaker Change: At the moment May I'll, yes.
Speaker Change: As things stand now assuming a 20 person steady growth and the pipeline is a good thing to assume but.
I'm optimistic that it will improve but one of the reasons is things are improving internationally for us.
Speaker Change: Especially among the multifamily at the higher end of the thoughts there is less and less competition, because we have invested in creating an ecosystem of products that our competition. Just hasn't you know David I mean, there's not much more complicated than that because when you want a fully connected system and youre running a multi how many people saw that are not that many players out there.
Speaker Change: So thats one reason why him up.
Speaker Change: Sales pipeline will increase and also in the all important to hotels and resorts sales vertical.
Ramesh Srinivasan: And also in the all-important hotels and resort sales vertical, Nehal, we have significantly expanded the sales team size in two ways. Number one, a lot of recent hiring in the last five, six months. And also now the book for time sales team is selling all Agilysys products as well. So that process has also started. So you add those two together, a majority, right? More than half of the hotel resort sales team now have started selling the product only in the last three to six months, all the Agilysys products. So that should contribute to increasing pipeline in the hotels and resort sector, which is our biggest sector, biggest sales vertical now.
Speaker Change: We have that we have.
Speaker Change: <unk> significantly expanded the sales team sites in two ways number one a lot of recent hiring in the last five six months.
Speaker Change: And also now the book four times sales team is selling all <unk> products as well. So that process has also started so you add those two together a majority more than half of the hotel was soft sales team now.
Speaker Change: I started selling the product only in the last three to six months all the analysis products, so that should contribute to increasing pipeline in the hotels in the south sector, which is sort of.
Ramesh Srinivasan: And also we are turning the corner with FSM, right, Managed Food Service Providers, or Food Service Management is really turning the corner, since we have turned the corner with POS. Now they are taking a serious look at our POS as well. So all these things together, Nehal, the current expectation would be 20% growth in sales pipeline, but I'm optimistic that will start improving. Okay, and then I believe that you guys have a, you know, target model for subscription growth of 25% to 30%. So, A. Is that target model still applicable? And then B. How does pipeline plus growth of 20% but with subscription growth of 25 to 30% on an organic basis presume?
Speaker Change: Biggest sector biggest sales vertical now and also we are turning the corner with FSAM managed foodservice providers. Our foodservice management. He is really turning the corner since we have done the corner with POS now they are taking a serious look at out of <unk> as well. So all of these things together.
Speaker Change: The current expectation would be 20% growth and sales pipeline, but I'm optimistic that we'll start improving slowly.
Speaker Change: Okay, and then I believe that you guys have a.
Speaker Change: Target model for subscription growth of 25% to 30% so.
Speaker Change: A is that target model still applicable and then B, how does pipeline plus growth of 20%, but with subscription growth of 25% to 30% on an organic basis, presumably.
Ramesh Srinivasan: Yeah, the sales pipeline 20% is all across the board, right? But that is just sales opportunities that we are working on, Nehal. Within that, the win ratio continues to improve. So the sales pipeline being 20% is no indication that the subscription revenue growth will only be that much. Subscription revenue growth could be more than that. So I wouldn't equate the two exactly, but I understand your point. But for FY26, our guidance is the subscription revenue growth we expect to be 25%. Okay, and then if I may speak one more, a couple more actually, sorry. So I understand and it's actually consistent with my thinking that Marriott is excluded from fiscal year 26.
Speaker Change: Yes, the sales pipeline, 20% is all across the board right, but that is just sales opportunities that we are working on.
Speaker Change: But we think that the win ratio continues to improve.
Speaker Change: So the sales pipeline being 20% there is no indication that the subscription revenue growth will only be thats my subscription revenue growth could be more than that so I wouldn't be great that do exactly but I understand your point, but for FY 'twenty six out of guidance as to the subscription revenue growth, we expect to be $25.
Speaker Change: Okay, and then if I may sneak one more couple more rationally sorry.
Speaker Change: So I understand and it's actually consistent with my thinking that Mario is excluded from fiscal year 'twenty six but given the commentary that the development phase appeared to have largely finished back in the September quarter, which would be fiscal third quarter can you just walk us through the rationale on why exclude that from the fiscal year 'twenty.
Ramesh Srinivasan: But you know, given commentary that the development phase appeared to have largely finished back in the September quarter, which would be fiscal third quarter, can you just walk us through the rationale on why exclude that from the fiscal year 26? Yes, I mean most of it is, I mean we'll enter the rollout phase but it won't be overly material to the to the P&L as we work through pilot and so once we hit the mass rollout it probably makes more sense to you know update the guidance or give the guidance in next year. and next year's results but it's mostly just because it's not overly material because we'll be, even though we'll get into the rollout, we'll still be in the pilot.
Speaker Change: Yes.
Speaker Change: Yes, I mean, most of it is I mean, we will enter the rollout phase, but it won't be overly material to the to the P&L as we work through pilots and so once we hit the mass rollout it probably makes more sense to update the guidance or give the guidance in next years.
Speaker Change: And next year's results, but it's mostly just because it's not overly material because it will be even though we'll get into the rollout will still be in the pilot phase of the rollout and it's a big transformational project.
Ramesh Srinivasan: And it's a big transformation project, Nehal, so plus or minus a few months, I mean you know this well, these kinds of big technology transformation projects, plus or minus few months, it is just tough to predict, right, but the good news is it's going well now, we are close to getting the test properties and then we'll see how it goes, right, we will see how it goes, but it's not, I mean we provide our guidance based on what we see and what is reasonably predictable, we just cannot include this now, and plus or minus few months, it could go either way, right, we just don't know yet.
Speaker Change: So plus or minus a few months.
Speaker Change: The sweat these kinds of big technology transformation projects, plus or minus few months is it just tough to predict but the good news is going well now we are close to getting the best properties and then we'll see how it goes right. We will see how it goes but it's not I mean, we provided our guidance based on what we see and what is reasonably predictable.
Speaker Change: We just cannot include the snow and plus or minus a few months. It could go either way, we just don't know yet.
Dave Wood: Yep, understood. And then my final question is that given projecting a bit to March and be flattish fiscal year 25 to fiscal year 26, that implies OPEX will grow about 14% year-over-year. So, is that enough to ensure that even your pipeline, your demo plus pipeline grows about 20% per year here? Yeah, I mean, we think of it on a percentage of revenue basis and pretty much I mean, sales and marketing will go up just a tick in fiscal year 26, mostly just due to timing of events. We had a user conference in May instead of March.
Speaker Change: Okay understood and then my final question is that given projecting.
Speaker Change: Be flattish fiscal year 'twenty five 'twenty six.
Speaker Change: Implies opex will grow about 14% year over year.
Speaker Change: Is that enough to ensure that even your pipeline your demo plus pipeline grows about 20% per year here.
Speaker Change: Yes, I mean, we think of it on a percentage of revenue basis, and pretty much I mean sales and marketing will go up just a tick.
Speaker Change: In fiscal year 'twenty six mostly just due to the timing of events. We had our user conference in May instead of March and like you've seen the last couple of years, we'll continue to see operating leverage in the G&A line on a percentage of revenue basis, and then R&D.
Dave Wood: And like you've seen the last couple years, we'll continue to see operating leverage in the G&A line on a percentage of revenue basis. And then R&D, you know, it'll it'll stay reasonably flat this year because We talked a lot about, we're still carrying multiple R&D teams. continues through the transformation of old products to new products and until we start the large PMS rollout. So it's really on a percentage of revenue. It's going to be kind of similar to what you've seen in the past with maybe sales and marketing going. And Nehal, when you're thinking of the 14% and, you know, revenue growth and all that, keep in mind a lot of the expansion has happened.
Speaker Change: It will stay reasonably flat this year because.
Speaker Change: I mean, as we've talked a lot about we're still carrying multiple R&D teams as we continue through the transformation of old products to new products and until we start those large pms rollout. So it's really on a percentage of revenue, it's going to be kind of similar to what you've seen in the past with maybe sales and marketing going up a little bit.
Speaker Change: And then when Youre thinking of the 14%.
Speaker Change: Revenue growth in our let's keep in mind a lot of the expansion has happened R&D over the years, we have expanded it quite a bit. We recently went through a big expansion of services in sales so be it.
George Sutton: R&D over the years, we have expanded it quite a bit. We recently went through a big expansion of services and sales. So we have sort of set ourselves up for future growth. Okay, thank you very much. Great job. Thank you, Nehal.
Speaker Change: Sort of set ourselves up for future growth.
Speaker Change: Okay.
Speaker Change: Got it okay. Thank you very much great job.
Speaker Change: Thank goodness.
George Sutton: Thank you. And we have a question from the line of George Sutton with Craig Hallam. Please proceed. Thank you. Ramesh, you talked a lot about international and the opportunity there. I'm wondering if you could just talk about what your white space is. How significant do you think international could be?
Speaker Change: Thank you.
Speaker Change: And we have a question from the line of George Sutton with Craig Hallum. Please proceed.
Thank you Ramesh you talked a lot about international and the opportunity there I'm wondering if you could just talk about what's your white spaces, how how significant do you think international could be for you.
Ramesh Srinivasan: Hi George, as these newer modernized versions settle down, George, international is a huge growth area for us. We are seeing more sales opportunities than ever before, but still not great, right? It is, at the moment, progressing well, but not great, and we are still dependent on big home run kind of wins. The one very positive sign with international is our current customers are spending a lot more with us now, because now they have new products they can invest on than ever before. So, the current customers are spending more with us. We have more reference customers that we are building up now.
Speaker Change: As these high Josh as these newer modernized versions settle down George internationally as a huge growth area for us.
Speaker Change: We are seeing more sales opportunities than ever before but still not great right at the moment progressing well, but not great and we are still dependent on big home run kind of wins. The one very positive sign with internationally as our current customers are spending a lot more with US now because now they have new products. They can in.
Speaker Change: Based on than ever before so the current customers are spending more with US we have more reference customers that we are building up now so it's progressing well, but that the exponential curve has not yet taken off George but to answer. Your first question is a massive growth area for us and the products are now that now it is a matter of spending us.
Ramesh Srinivasan: So, it's progressing well, but that exponential curve has not yet taken off, George. But I think the first question is a massive growth area for us, and the products are now there. Now it is a matter of spreading us. Thank you.
Speaker Change: Is that.
Ramesh Srinivasan: And then just lastly on book for time, because a lot of the presentations you gave were X book for time. Can you just give us a sense of how that acquisition has gone? That acquisition has gone very well, George. Thank you for asking. We're very happy with the acquisition. The best way I would express it is, given a chance, we would do it again, without a doubt. Great people, added tremendous talent value to the team, good product, a very respected, well-regarded brand name, global reach. So every aspect of the Book for Time business, the sales and implementations of the Book for Time product, the spa product is going very well.
Speaker Change: Thank you and then just lastly on book for time, because a lot of the presentations. You gave were X book for time can you just give us a sense of how that acquisition has gone.
Speaker Change: That acquisition has gone very well jobs.
Speaker Change: For the asking happy very happy with the acquisition.
Speaker Change: The best way I would express it is given a chance we will do it again without a doubt.
Speaker Change: Great people.
Speaker Change: Did tremendous style and value to the team good product a very respected well regarded brand name global reach.
Speaker Change: Every aspect of the <unk> business, the sales and implementations of the book for Dime product as a product is going very well that continues to do very well.
Ramesh Srinivasan: That continues to do very well. And the cross-selling piece is beginning to take shape now. We always thought it would make a difference in FY26, and I think it is going to make a reasonable difference in FY26, which was the plan all along. So we've expanded the hotel resort sales team by a significant number in the last five, six months. Now the Book for Time sales team is also part of the hotel resort sales team. So all that adds considerable strength to selling there. So all around, the Book for Time itself is an excellent acquisition.
Speaker Change: The cross selling piece is beginning to take shape now we always thought it would make a difference in FY 'twenty six.
Speaker Change: It is going to make a reasonable dividends in FY 'twenty, six which was the plan all along so we've expanded the hotel resort sales team by a significant number in the last five six months now the book full time sales team is also part of the hotel resort sales team. So all of that adds considerable strength selling there.
Speaker Change: All around the book Fulltime itself is an excellent acquisition, we're very happy with it now booked full time sales team contributing to selling all the analysis product that product that process is just getting started model and we think we'll do well in fiscal 'twenty six.
George Sutton: We're very happy with it. Now Book for Time sales team contributing to selling all the Agilysys product, that process is just getting started now, and we think will do well in FY26. Perfect. Thank you very much. Thank you, John. Appreciate it.
Speaker Change: Perfect. Thank you very much thank.
Speaker Change: Thank you Jonathan I appreciate it.
Ramesh Srinivasan: And as I see no further questions in queue, I will conclude the Q&A session and turn it back to Ramesh Srinivasan for closing remarks. Thank you, Carmen. Thank you all for participating and for your interest and support.
Speaker Change: And as I see no further questions in queue I will conclude the Q&A session and turn it back to Ramesh Srinivasan for closing remarks.
Thank you Carmen. Thank you all for participating and for your interest and support and we look forward to talking to you again in a couple of months from now towards the end of July when we will be reporting on fiscal 2026 Q1 results. Thank you.
Ramesh Srinivasan: We look forward to talking to you again in a couple of months from now towards the end of July, when we will be reporting on fiscal 2026 Q1 results. Thank you.
Operator: And thank you all for participating in today's conference. You may now disconnect. Thank you for watching!
Speaker Change: And thank you all for participating in today's conference you may now disconnect.
Speaker Change: Yeah.
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