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Agilysys (AGYS) is soaring after reporting its Q4 (Mar) results last night. The hospitality software provider, which offers POS, property management, payments, and other operational tools, delivered a big EPS beat, a nice bounce back after last quarter's miss. Revenue increased 11.7% yr/yr to $82.9 mln, also above expectations. More encouragingly, AGYS issued above-consensus FY27 revenue guidance at $365-370 mln.

• This was a record-setting quarter across several key metrics. Subscription revenue grew 24.1% yr/yr to a record $36.9 mln, while recurring revenue, which includes subscription revenue and maintenance fees, increased roughly 18% yr/yr to a record $54.4 mln, or 65.5% of total revenue.
• Customer momentum was also strong. AGYS added 20 new customers, with those deals averaging seven products each and 19 of the 20 subscription-based. It also added 85 new properties under existing customers, while total subscription ARR installed during FY26 was 32% higher than FY25.
• AGYS said POS had a fantastic recovery during the year, putting it back in position as a strong hospitality POS player. Q4 subscription revenue tied to POS/POS-related modules increased 19% yr/yr.
• A richer recurring revenue mix and AI-related efficiencies are also supporting margins. Gross margin expanded 370 bps yr/yr to 64.4%, and management said AGYS has entered the beginning of its gross margin expansion phase. AI is also helping improve operating leverage and accelerate product differentiation across ordering, front-desk automation, revenue intelligence, and CRS.
• The FY27 guide implies another record year with stronger profitability. Revenue guidance implies roughly 15% growth at the midpoint, similar to FY26's 15.9% growth. Subscription revenue is expected to grow at least 30% again, while adjusted EBITDA margin is expected to improve to 24% from 21.2% in FY26.

Briefing.com Analyst Insight

This was a strong close to FY26 for AGYS and a nice bounce back after shares gapped lower following last quarter's report. The Q4 beat and upside FY27 guide were the main positives, but the quality of the quarter was also encouraging. Subscription revenue continues to grow at a healthy pace, customer activity was strong, and the recovery in POS supports a more favorable backdrop across AGYS' broader hospitality software platform. A richer recurring revenue mix is also supporting margins. Another positive was the commentary around AI, which is helping improve operating leverage and accelerate product differentiation, positioning AI more as a tailwind than a potential disruption risk. With FY27 guidance calling for another year of mid-teens revenue growth, 30%+ subscription growth, and stronger adjusted EBITDA margin, the report reinforces that AGYS' recurring revenue base and broader hospitality software platform are gaining traction.