Analysis of Market Competitiveness and Growth Prospects of Agilysys (AGYS)'s Hospitality Software Business

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Agilysys, Inc. is a software solution provider focused on the hotel and hospitality industry, with over 45 years of industry experience. Headquartered in Alpharetta, Georgia, U.S., the company operates across North America, Europe, the Middle East, Asia-Pacific, and India, and is one of the key players in the global hospitality software market[0][1].

Indicator	Value
Market Cap	$3.27 Billion
Current Stock Price	$116.63
FY2025 Revenue	$276 Million
5-Year Revenue CAGR	19.1%
Annual Recurring Revenue (ARR)	$182 Million
Number of Employees	Approximately 2,200

The company provides end-to-end hospitality software solutions, covering comprehensive functions including

, , , , , , and [1].

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Agilysys has built a highly integrated

platform, offering modular and interconnected solutions:

:

• LMS™
  - Property management solution for large, complex operations, supporting 100 to 7,000+ guest rooms
• Versa PMS
  - For hotels and resorts with 50-1,500 guest rooms
• Stay PMS
  - The latest cloud-native SaaS property management system
• InfoGenesis® POS
  - Award-winning enterprise-level point-of-sale solution
• Agilysys Pay
  - Payment gateway solution with PCI-P2PE validation
• Eatec®
  - Procurement, inventory, and recipe management solution
• IG Series
  - Includes innovative products such as IG Kiosk, IG OnDemand, and IG Fly

:

• AI-Powered
  : IG PanOptic AI self-checkout kiosk, using computer vision and AI to scan items
• Mobile-First
  : Agilysys Express Mobile supports mobile check-in/check-out and digital room keys
• Contactless Experience
  : Comprehensive contactless solutions covering the entire customer journey
• Data Analysis
  : Agilysys Analyze cloud-based data analysis platform

Agilysys has a high-quality customer portfolio, including many top global hotel and hospitality brands[1]:

:

Category	Representative Clients
Hotel Groups	Marriott International, Hilton Worldwide, IHG, Kimpton, Venetian Resort
Casinos/Gaming	Caesars Entertainment, MGM, Boyd Gaming, Station Casinos
Cruise Lines	Royal Caribbean Group, Carnival UK
Food Service	Compass Group North America, AVI Foodsystems
Healthcare/Corporate	Banner Health, UT Southwestern Medical Center

: The company’s customer base is highly diversified, covering large, mid-sized, and boutique hospitality providers, reducing the risk of single customer churn.

According to industry reports, the

, with the top five players accounting for approximately 45% of 2024 revenue[3]. Agilysys is listed as one of the key market participants, competing with the following companies:

Competitors	Competitive Advantages
Oracle	Strong ERP foundation, integrated financial and data analysis
Sabre/Amadeus	Global distribution systems and travel agency networks
Mews	Cloud-native architecture, open integration directory
Cloudbeds	Digital-first focus for independent hotels
NCR Corporation	Payment and hardware integration capabilities

:

• Deep customization focused on the vertical hospitality sector
• Over 45 years of accumulated industry experience
• Comprehensive product suite covering the entire customer journey
• Strong enterprise-level customer base

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FY2025 revenue composition shows continuous strengthening of the subscription and recurring revenue model[1][2]:

Revenue Category	FY2025	FY2024	YoY Growth
Subscription and Maintenance	$170 Million	$138 Million	+23.2%
Professional Services	$64 Million	$50 Million	+27.6%
Products (Hardware, etc.)	$41 Million	$49 Million	-15.9%
Total Revenue	$276 Million	$237 Million	+16.1%

:

• Recurring revenue ratio continues to increase
• High-margin subscription business grows faster than low-margin product business
• Operating margin increased significantly from 6% in FY2024 to 17.8% in Q2 FY2025[2]

Profitability Indicator	FY2025	Trend
Operating Income	$22.59 Million	+43% YoY
Net Income	$23.22 Million	Abnormal last year due to tax benefits
Free Cash Flow	$52.34 Million	Consistently positive
Gross Margin	62.4%	Stably high

Q2 FY2025 (as of September 2025) results exceeded expectations[2]:

• Revenue
  : $79.3 Million vs. Expected $76.94 Million (+3.1% beat)
• EPS
  : $0.40 vs. Expected $0.38 (+4.3% beat)
• Adjusted EBITDA
  : $16.36 Million vs. Expected $14.94 Million
• Operating Margin
  : 17.8% vs. 6% in the same period last year

The company raised its full-year FY2025 revenue guidance to $316.5 Million (midpoint), representing a +2.1% increase from the previous guidance.

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The global hospitality software market is in a steady growth phase[3][4]:

Time Period	Market Size	CAGR
2024	$7.06 Billion	-
2025	$7.57 Billion	+6.9%
2030	$10.55 Billion	6.7-7.0%

:

• Property Management Systems (PMS) are expected to hold the largest share of 27.7% in 2025
• The North American market is expected to account for 33.2% of the share in 2025
• The Asia-Pacific region is expected to grow the fastest

:
According to the company’s investor presentation materials, Agilysys expects to connect approximately 900,000 Marriott guest rooms (within the next 3 years), while currently fewer than 300,000 guest rooms are connected to its PMS solution[5]. This strategic partnership will bring significant incremental revenue to the company.

:

• Stay PMS
  - Cloud-native SaaS product aligns with the industry’s cloud migration trend
• AI Integration
  - AI-driven personalized recommendations and pricing optimization
• Mobile and Contactless Technologies
  - Meet guest expectations in the post-pandemic era

:
The strategic transition to subscription services will bring:

• Higher customer stickiness
• Predictable recurring revenue
• Improved margin structure

:
Expansion based on existing core products:

• Spa and Golf Solutions ($26 Million ARR potential)
• Sales and Event Management ($11 Million ARR potential)
• Inventory and Procurement ($55 Million ARR potential)

Indicator	FY2025 Actual	FY2028 Analyst Projections
Revenue	$276 Million	$416 Million
ARR	$182 Million	Continuous Growth
EBITDA	-	$23.3 Million

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Indicator	Value
Consensus Rating	Buy (100% Buy)
Median Target Price	$140.00
Target Price Range	$140 - $155
Potential Upside from Current Price	+20%

:

• December 15, 2025: Needham maintained a Buy rating
• December 4, 2025: Oppenheimer maintained an Outperform rating

Valuation Indicator	Value	Assessment
P/E (TTM)	133.5x	High
P/S (TTM)	10.9x	Moderately High
Beta	0.42	Low Volatility
DCF Implied Discount	-75%	Indicates Overvaluation Risk

[0]:

Scenario	Intrinsic Value	vs. Current Price
Conservative	$17.19	-85%
Neutral	$24.76	-79%
Optimistic	$46.02	-60%

The current stock price is significantly higher than the DCF valuation, reflecting the market’s premium expectation for the company’s high growth.

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[0]:

Indicator	Value/Status	Signal
Current Price	$116.63	-
20-Day Moving Average	$120.05	Stock price is below the moving average
50-Day Moving Average	$123.18	Mid-term downward trend
MACD	No Crossover	Bearish
KDJ	K:42.4, D:41.7	Neutral to Bullish
RSI	Normal Range	-
Beta	0.42	Low volatility relative to the broader market
Trend Judgment	Sideways Consolidation	No clear direction

:

• Support Level: $114.71
• Resistance Level: $120.05

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• Large tech companies (Oracle, SAP) may increase investment
• Cloud-native startups (Mews, Cloudbeds) continue to innovate
• Price competition may impact profit margins

• The hospitality industry is sensitive to economic cycles
• Economic downturns may lead to customers cutting IT spending
• Fluctuations in demand for business travel and tourism

• Rapid technological iteration requires continuous R&D investment
• Cloud migration may face execution challenges
• Cybersecurity and data privacy compliance requirements

• The current P/E ratio of 133x is at a historical high
• Any underperformance relative to expectations may lead to a sharp correction
• DCF valuation shows significant overvaluation

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:

:
✅ Over 45 years of industry experience and deep customer relationships
✅ Comprehensive product ecosystem covering the entire customer journey
✅ Successful transition to a high-margin subscription model
✅ Strategic partnerships with top clients such as Marriott
✅ 100% analyst Buy rating and 20% upside potential

:
🚀 Marriott guest room connection initiative (900,000 guest room potential)
🚀 6-7% CAGR growth in the hospitality software market
🚀 Industry cloud migration trend favors Stay PMS
🚀 AI and contactless technology innovations

:
⚠️ Current valuation is high; the 133x P/E ratio requires sustained high growth to support it
⚠️ Faces competition from giants such as Oracle and Sabre, as well as cloud-native startups
⚠️ Economic cycle fluctuations may impact hospitality industry IT spending

: Agilysys is a high-quality hospitality software company with a strong market position and growth potential. For investors who can tolerate volatility, it may offer long-term value at the current price level. It is recommended to pay attention to the Q3 FY2025 financial report to be released on January 20, 2026, to verify the company’s sustained growth capability.

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[0] Jinling API Data - Agilysys Company Overview, Financial Analysis, Technical Analysis, and DCF Valuation

[1] SEC Filing 10-K - Agilysys, Inc. FY2024 Annual Report (https://www.sec.gov/Archives/edgar/data/78749/000095017025076527/agys-20250331.htm)

[2] StockStory - Agilysys (AGYS) Research Report: Q3 CY2025 Update (https://stockstory.org/us/stocks/nasdaq/agys)

[3] Mordor Intelligence - Hospitality Property Management Software Market Report (https://www.mordorintelligence.com/industry-reports/hospitality-property-management-software-market)

[4] GlobeNewswire - Hotel & Hospitality Management Software Market Report 2025 (https://www.globenewswire.com/news-release/2025/08/13/3132547/28124/en/Hotel-Hospitality-Management-Software-Market-Report-2025)

[5] Agilysys Investor Presentation - Q4 FY2025 (https://agilysys.com/en/wp-content/uploads/Q4-FY25-IR-Deck.pdf)