A number of stocks fell in the morning session after a broad sell-off swept through the software sector, driven by growing concerns about the impact of artificial intelligence. This led to institutional repositioning as traders pivot away from traditional SaaS providers in favor of companies with more defensible, AI-integrated moats.
The tech-heavy Nasdaq Composite index declined by 0.8%, while the broader S&P 500 also slipped.
Agilysys’ fourth quarter results were met with a significant negative market reaction, as shares declined following the announcement. Despite exceeding Wall Street revenue expectations, management noted that non-GAAP profit came in below consensus, mainly due to higher product development and implementation costs during the holiday period. CEO Ramesh Srinivasan pointed to strong momentum in subscription-based sales, particularly across hotel, resort, and cruise ship segments, as a key growth driver. He also acknowledged that a temporary slowdown in the casino gaming business during October and November weighed on results, though this recovered in December. Srinivasan described product modernization and AI-driven implementation efficiencies as central to the company’s ability to convert bookings to revenue more rapidly.
Shares of hospitality software provider Agilysys (NASDAQ:AGYS) fell 20.5% in the morning session after the company reported fourth-quarter results that missed profit expectations.
Hospitality software provider Agilysys (NASDAQ:AGYS) announced better-than-expected revenue in Q4 CY2025, with sales up 15.6% year on year to $80.39 million. The company expects the full year’s revenue to be around $318 million, close to analysts’ estimates. Its non-GAAP profit of $0.42 per share was 7.8% below analysts’ consensus estimates.
Hospitality software provider Agilysys (NASDAQ:AGYS) reported revenue ahead of Wall Streets expectations in Q4 CY2025, with sales up 15.6% year on year to $80.39 million. The company expects the full year’s revenue to be around $318 million, close to analysts’ estimates. Its non-GAAP profit of $0.42 per share was 7.8% below analysts’ consensus estimates.
A number of stocks fell in the afternoon session after tech stocks pulled back as reports surfaced that Chinese customs authorities blocked Nvidia's H200 AI chips, effectively halting their entry despite recent U.S. export approvals.
Even if a company is profitable, it doesn’t always mean it’s a great investment.
Some struggle to maintain growth, face looming threats, or fail to reinvest wisely, limiting their future potential.
Growth is a hallmark of all great companies, but the laws of gravity eventually take hold.
Those who rode the COVID boom and ensuing tech selloff in 2022 will surely remember that the market’s punishment can be swift and severe when trajectories fall.
Small-cap stocks in the Russell 2000 (^RUT) can be a goldmine for investors looking beyond the usual large-cap names.
But with less stability and fewer resources than their bigger counterparts, these companies face steeper challenges in scaling their businesses.
A number of stocks fell in the afternoon session after investors grew increasingly concerned that the billions of dollars being invested into artificial intelligence may not generate sufficient profits.
Software is rapidly reducing operating expenses for businesses. Companies bringing it to life have been rewarded with high valuation multiples that make fundraising easier,
but they have weighed on the returns lately as the industry has pulled back by 1.8% over the past six months. This drawdown is a far cry from the S&P 500’s 14.4% ascent.
Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.
Just because a business is in the green today doesn’t mean it will thrive tomorrow.
Since November 2020, the S&P 500 has delivered a total return of 85.8%. But one standout stock has more than doubled the market - over the past five years, Agilysys has surged 204% to $123.52 per share. Its momentum hasn’t stopped as it’s also gained 21.9% in the last six months thanks to its solid quarterly results, beating the S&P by 10.5%.
A company that generates cash isn’t automatically a winner.
Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.
Agilysys delivered a strong third quarter, supported by a broad-based acceleration in subscription software sales and notable gains across its hospitality-focused product ecosystem. Management attributed the positive results to sustained improvements in its cloud-native solutions and efficiencies in project implementation, especially within key verticals like gaming casinos and foodservice management. CEO Ramesh Srinivasan emphasized that “the product ecosystem is getting better,” and highlighted significant contributions from newly modernized software modules and a more effective sales organization. The company also benefited from higher international sales and expanding customer adoption of its unified hospitality platform.
Shares of hospitality software provider Agilysys (NASDAQ:AGYS) jumped 24.1% in the morning session after the company reported strong third-quarter 2025 results that surpassed revenue and profit expectations, and it raised its full-year forecast.
