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5 Revealing Analyst Questions From Agilysys’s Q2 Earnings Call

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Agilysys’ second quarter results for 2025 were met with a negative market reaction, as sales growth outpaced expectations but profitability metrics fell short. Management attributed the strong revenue performance to record subscription software sales and a resurgence in food service management and international verticals. CEO Ramesh Srinivasan highlighted that the latest quarter saw the broadest sales success in company history, with multiple verticals performing well. However, higher-than-normal sales and marketing expenses, due in part to the timing of the annual user conference, weighed on operating margins.

Is now the time to buy AGYS? Find out in our full research report (it’s free).

Agilysys (AGYS) Q2 CY2025 Highlights:

  • Revenue: $76.68 million vs analyst estimates of $74.39 million (20.7% year-on-year growth, 3.1% beat)
  • Adjusted EPS: $0.33 vs analyst expectations of $0.36 (8.8% miss)
  • Adjusted Operating Income: $12.32 million vs analyst estimates of $6.28 million (16.1% margin, 96.2% beat)
  • The company reconfirmed its revenue guidance for the full year of $310 million at the midpoint
  • Operating Margin: 5.9%, down from 9% in the same quarter last year
  • Market Capitalization: $3.26 billion

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions Agilysys’s Q2 Earnings Call

  • Stephen Sheldon (William Blair) asked about new sales capacity and productivity. CEO Ramesh Srinivasan said sales expansion focused on hotels, resorts, and inside sales, and that improved territory coverage was already yielding results, but productivity gains could still be realized.
  • Sheldon (William Blair) also questioned international growth drivers. Srinivasan said product localization was largely complete, with momentum coming from large multi-product deals and the company’s integrated ecosystem, but noted smaller deal wins remain a focus.
  • Sheldon (William Blair) followed up on user conference costs’ impact on margins. CFO Dave Wood confirmed most of the sales and marketing expense spike came from the event, and normalized margins should return in future quarters.
  • Matt VanVliet (Cantor Fitzgerald) asked about the impact of new marketing leadership and sales structure. Srinivasan explained sales structure improvements were yielding benefits, and further investments in marketing would raise Agilysys’ presence at industry events.
  • Brian Schwartz (Oppenheimer) inquired about performance across verticals and customer types. Srinivasan highlighted a broad-based sales quarter, with notable strength in food service management recovery, international expansion, and both new and existing customer deals.

Catalysts in Upcoming Quarters

In the quarters ahead, our analysts will monitor (1) the pace and breadth of subscription and professional services backlog conversion, (2) the effectiveness of AI-driven product enhancements in driving customer adoption and value, and (3) the company’s ability to balance sales and marketing investments with margin targets. Progress in cross-selling to Book4time customers and international market penetration will also be key areas to watch.

Agilysys currently trades at $116.89, in line with $117.18 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).

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