Agilysys Inc (NASDAQ:AGYS), a leading global provider of hospitality software solutions that deliver High Return Hospitality, stock rallies 14.41% (As on May 10, 11:27:23 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the fourth quarter of FY 24. Recurring revenue (comprised of subscription and maintenance charges) was a record $36.6 million, or 58.8% of total net revenue, compared to $31.4 million, or 59.3% of total net revenue for the same period in fiscal 2023. Subscription revenue increased 31.6% year over year and was 57.0% of total recurring revenue compared to 50.6% of total recurring revenue in the fourth quarter of fiscal 2023. Gross margin was 61.5% in the fiscal 2024 fourth quarter compared to 60.8% in the comparable prior-year period. Net income attributable to common shareholders in the fiscal 2024 fourth quarter was $3.0 million, or $0.11 per diluted share, compared to $3.6 million, or $0.14 per diluted share, in the comparable prior-year period. Adjusted EBITDA (non-GAAP) was $11.0 million compared to $8.1 million in the comparable prior-year period

AGYS in the fourth quarter of FY 24 has reported the adjusted earnings per share of 32 cents, beating the analysts’ estimates for the adjusted earnings per share of 24 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 17.6 percent to $62.22 million in the fourth quarter of FY 24, beating the analysts’ estimates for revenue by 0.62%. Significant growth in subscription and services revenue and improvements in services margins are good indicators of the continuing progress as a world-class cloud-native end-to-end technology provider fulfilling the growing need for such high-grade software solutions in the hospitality industry. With the completion of virtually all the product re-engineering and modernization projects across POS, PMS, and Inventory-Procurement on which the company is focused for the past several years growth.

Additionally, free cash flow (non-GAAP) in the fiscal 2024 fourth quarter was $29.3 million compared to free cash flow of $13.2 million in the fiscal 2023 fourth quarter. Ending cash balance was $144.9 million compared to ending cash balance of $112.8 million as of fiscal 2023 year-end.

The Company expects full year fiscal 2025 revenue to be $275 million to $280 million, including higher than 27% year-over-year subscription revenue growth. Adjusted EBITDA is expected to be 16% of revenue for the full fiscal year.