Agilysys surges on 16th consecutive record quarter, raises guidance
Hospitality software provider lifts FY2026 outlook to $318M as subscription revenue jumps 23%
Agilysys shares jumped 5.5% on Tuesday after the hospitality software provider reported its 16th consecutive record revenue quarter and raised its full-year fiscal 2026 guidance, extending a multiyear growth streak that has captivated investors.
The Alpharetta, Georgia-based company reported revenue of $80.4 million for the quarter, surpassing analyst estimates of $79.1 million and marking a 15.6% increase from the prior year. Despite missing earnings per share expectations, investors focused on the company's top-line momentum and subscription growth, with subscription revenue surging 23.1% year-over-year.
Agilysys lifted its fiscal 2026 revenue guidance to $318 million, positioning the outlook at the higher end of its previously provided range. The company also generated $22.7 million in free cash flow during the quarter, a metric that analysts increasingly prioritize as a measure of operational efficiency and financial health.
The stock's advance to $113.55 brings Agilysys's market capitalization to approximately $3 billion and pushes shares closer to their 52-week high of $145.25 reached earlier this year. The stock has more than doubled since its 52-week low of $63.71, reflecting strong institutional confidence in the company's strategic position within the hospitality technology market.
Agilysys, which provides point-of-sale systems, property management software, and inventory management solutions to hotels, casinos, and restaurants, has benefited from the hospitality industry's accelerated digital transformation. As operators seek to streamline operations and enhance guest experiences post-pandemic, demand for integrated technology platforms has surged.
The company's trailing 12-month revenue of $299.8 million puts the new $318 million guidance within reach, implying roughly 6% growth for the full fiscal year. Analysts have maintained a bullish outlook on the stock, with six of seven analysts rating it a buy or strong buy and an average price target of $142, suggesting upside of approximately 25% from current levels.
The shift toward subscription-based revenue has been a key strategic focus for Agilysys, as recurring revenue models typically command higher valuations and provide more predictable cash flows. The 23.1% increase in subscription revenue this quarter indicates successful execution of this transition, though the company's trailing price-to-sales ratio of 10.07 suggests the market is already pricing in significant growth expectations.
With 106.3% of shares held by institutional investors—indicating significant short interest—Agilysys's consistent quarterly beats have created a virtuous cycle of rising analyst expectations and improving fundamentals. The company's quarterly revenue growth of 16.1% year-over-year outpaces many enterprise software peers, supporting its premium valuation multiple.
Looking ahead, investors will be watching whether Agilysys can maintain its record-setting momentum through the remainder of fiscal 2026, particularly as the hospitality industry faces potential macroeconomic headwinds. However, the company's 16-quarter streak of record revenue suggests strong execution and a resilient customer base that continues to invest in technology despite broader economic uncertainty.