Agilysys revenue hits $93.4m, and subscriptions grew 32.6%

Agilysys posted another record quarter, and for properties running its PMS, POS and inventory software the useful detail is where the growth came from. Subscriptions, mostly.

Revenue for the three months to 30 September 2026 was $93.4 million, up 17.7% from $79.3 million a year earlier. Agilysys called it the nineteenth consecutive record revenue quarter. Subscription and maintenance revenue, which the company reports as one line, came in at $62.2 million, up 22.0%. Subscription revenue on its own grew 32.6% and now makes up 71.2% of recurring revenue. Recurring revenue was 66.6% of the total, against 64.3% a year ago.

Professional services revenue was $19.2 million, up 5.3%. Products revenue was $12.0 million, up 18.8%, and management said one-time product revenue came in higher than expected.

Gross margin was 64.6%, up from 61.7%. Operating income was $15.2 million against $14.1 million. Net income was $13.2 million against $11.7 million, giving diluted earnings per share of $0.46 against $0.41. On a non-GAAP basis, adjusted EBITDA was $24.1 million, a 25.9% margin, up from $16.4 million and roughly 20.6% a year earlier. Adjusted diluted EPS was $0.67 against $0.40.

For the six months to 30 September, revenue was $181.0 million against $156.0 million, net income $22.2 million against $16.6 million, and free cash flow $22.1 million against $10.0 million. Cash and equivalents stood at $137.6 million, up from $116.9 million at the 31 March year end.

Agilysys raised its full-year outlook. It now expects fiscal 2027 revenue of $374 million to $378 million, subscription revenue growth of at least 34% rather than at least 32%, and adjusted EBITDA at 25% of revenue rather than 24%.

Ramesh Srinivasan, president and chief executive, said the business is growing ahead of prior expectations and that total backlog remains at record levels. Dave Wood, chief financial officer, said the company is well positioned to keep executing against its forecast through the second half of the year.

The parts worth a second look

Two things sit underneath the headline. The first is that products revenue, which is largely hardware, grew 18.8% and the company itself flagged one-time product revenue as higher than expected. Some of the beat is timing rather than software annuity.

The second is cash. Adjusted EBITDA jumped by nearly half year on year, but free cash flow for the quarter was $14.8 million against $15.0 million, essentially flat. The six-month figure looks much better, so this may be a quarter-end timing effect rather than a trend, but it is worth tracking.

The release also gives no numeric backlog or ARR figure, only that backlog "remains at record levels". There is nothing published to check the implementation pipeline against.

What it means for operators

Agilysys sells into casinos, resorts, cruise and managed food service, where implementations are long and staged. Subscriptions growing 32.6% while professional services grow 5.3% is the gap to watch. Software is being sold faster than it is being delivered, and services capacity is what turns a signed contract into a live property.

If you are in the queue for a deployment, the raised guidance is a reasonable sign the vendor is investing. It is not a reason to assume your go-live date moved forward.