Good day, ladies and gentlemen, and welcome to the Agilysys Fiscal 2022 First Quarter Conference Call. As a reminder, today's conference call may be recorded. I would now like to turn the conference over to Jessica Hennessy, Director of Corporate Strategy and Investor Relations at Agilysys. You may begin.

Thank you, Cherry, and good afternoon, everybody. Thank you for joining the Agilysys fiscal 2022 first quarter conference call. We will get started in just a minute with management's comments, but before doing so, let me read the safe harbor language. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the safe harbor protections of the Private Securities Litigation Reform Act of 1995, including statements regarding our financial guidance. Although the Company believes that its forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause results to differ materially. Important factors that could cause actual results to vary materially from these in the forward-looking statements include the continued effect of the COVID-19 pandemic on our business and the hospitality industry. The timing and extent of the recovery phase of the hospitality industry and the risks set forth in the company's reports on Form 10-K and 10-Q and other reports filed with the Securities and Exchange Commission. With that, I'd now like to turn the call over to Mr. Ramesh Srinivasan, President and Chief Executive Officer of Agilysys. Ramesh, please go ahead.

Thank you, Jessica. Good evening. Welcome to our fiscal 2022 first quarter earnings call. Joining Jessica and me on the call today in our Atlanta office is Dave Wood, our CFO. We hope all of you and your families are fully vaccinated, doing well and staying safe and healthy. We continue to treat the good health, happiness and wellbeing of our Agilysys teammates, customers, and partner personnel as our top priority. The productivity and quality of execution levels of our global workforce remain at high levels, despite the personnel and family challenges the virus has forced for many of us. We are deeply grateful to all our employees for everything they continue to do for Agilysys under challenging circumstances. During narratives, such as this earnings call for the remainder of this fiscal year, we will do our best to offer comparisons to two historical quarters; one with the comparable quarter from a year ago, and one with the comparable quarter from two years ago. Fiscal 2021, the period from calendar April 2022 to March 2021 was obviously not a normal year. Providing comparisons with both last year and the year before that when there were no pandemic-related challenges should give you a better idea of our business progress. From the standpoint of sales success from around the February end, March timeframe of this calendar year, we have seen good recovery in the gaming and resort market verticals in the U.S. and a partial recovery in the hotel and cruise ship verticals, while managed food services and international regions remain significantly affected by pandemic-related closures. Both the APAC and EMEA regions continue to be heavily impacted by lockdowns and other severe restrictions. Despite the lack of recovery in multiple verticals and geographic market areas, this was our best Q1, April to June quarter with respect to sales success and revenue level slightly higher than Q1 two years ago when all our markets were operating normally with no pandemic-related challenges. Professional services and hardware sales bookings during Q1 fiscal 2022 were close to even with Q1 two years ago, while software sales were ahead of pre-pandemic levels. This was a record subscription software sales quarter in sales agreements won, signed, and closed. Most of these SaaS projects won during the quarter are yet to be implemented and will contribute to future subscription revenue growth. Our product innovation and increased competitive advantage levels have made up for the pandemic-related market challenges in several verticals and regions when we compare the current Q1 quarter results with Q1 two years ago. With respect to financial results for the quarter, which Dave will cover in a lot more detail. Revenue for the quarter was $38.7 million, a 30% increase over Q1 of last year and a slight 1% increase over the pre-pandemic Q1 from two years ago. Combined product and services revenue levels improved by about 67% over Q1 of last year but remained 15% below Q1 from two years ago. Recurring revenue was a record $23.2 million, 13% higher than Q1 last year and nearly 16% higher than Q1 two years ago. Within recurring revenue, subscription revenue was also a record, crossing the $10 million quarterly mark for the first time. Subscription revenue now constitutes nearly 44% of overall revenue, an all-time high. The consistent growth in subscription revenue is a solid testament to our accelerating pace of product innovation and the increased availability of cloud-based software applications. Operating net income of $1.5 million and GAAP EPS of $0.06 were solid improvements over both Q1 of last fiscal year and Q1 two years ago. Adjusted EBITDA was $6.9 million, about 18% of revenue. Revenue levels of this quarter were negatively impacted by implementation delays, which drove our combined backlog across product, services, and recurring revenue to record levels. The two major reasons for these delays were one, and by far the main reason, lack of resources at many customer sites, and two, implementations of some of our recently developed and modernized software applications are taking a few more weeks than usual to get all the technical implementation details sorted out. Both these challenges are short-term issues, which should get cleared up soon, enabling better backlog conversion to revenue during future quarters. During Q1, April to June, the signed sales agreements, which added 15 new customers and 69 new properties, which did not have any of our products before, but the parent company was already our customer. And there were 100 instances of selling at least one additional product to sites, which already had at least one of our other products. More than 90% of the 15 new customers and 69 new properties added during the quarter were subscription license-based. This quarter was among our strongest with respect to cash collections, helping us edge past the $100 million cash balance mark for the first time in many years. Despite all the challenges which remain in large swaths of the hospitality industry, our cash collection trend has been encouraging and indicative of our customers seeing improvements in their revenue streams, and also needing enhanced technology solutions. We continue to remain disciplined with our expense levels and use of cash. Our modernized products are beginning to gain good traction in the field; we are now seriously competitive in the property management system, PMS ecosystem marketplace with the cloud-native state DMS leading the way. The completely modernized Visual One PMS product is on track to be released for customer deployments in a few weeks from now giving us a second world-class cloud-native PMS option. With several PMS add-on modules like Spa, Golf, Sales and Catering, Book, Express Mobile, Service, and Engage already implemented at various customer sites, we are now in a good position to execute on our vision of providing a complete modular and integrated open API architecture-based modern technology cloud-native set of applications, which will help our customers manage the entire guest journey. From a direct channel commission-free booking engine, which enables bookings not just for rooms but across all amenities offered by a resort in a single booking interaction all the way till the last guest touch point and even beyond with promotions and other loyalty points management tools. This reduces the need for hospitality customers to depend on too many different technology providers and carry the burden themselves of system integration challenges. We have now reached the competitive positioning stage in the PMS software space, we have been working diligently towards during the past few years. We are now being included and are seriously competitive in PMS RFPs, which would not have had our participation a couple of years ago. We've also made good progress that follow up releases of the modernized InfoGenesis POS terminal, which we discussed with you before. These follow up releases have included additional required payment gateway integration approvals and other third-party system integrations to make modernized InfoGenesis POS available across multiple hospitality verticals. All UI aspects have been re-engineered in this modernized version, making it a lot easier to operate a food outlet and serve guests. We've now given ourselves the capability of combining the advantages of many sleek all-in-one devices available today with the complexities of robust enterprise requirements, whereas customers need not sacrifice one need in search of the other. They need not be forced down to the traditional heavy-duty terminals and also not give up on all their crucial and extensive enterprise management requirements. Additional POS software modules like the remote ordering tool on-demand and the easy contactless option Quick Pay have been very successful during the past year across hundreds of food outlet profit centers and continue to drive demand for our POS solutions. As the modernization of the inventory and procurement products Eatec and Stratton Warren continue to make good progress. We are seeing more sales success for those two products as well. Q1 fiscal 2022 was our best quarter of inventory procurement sales in about 2.5 years. This is another growing business area, which all these years has been hampered by lack of modern technology, despite these products having robust and complete functionality and feature sets. With the product sets reaching the stage we have been building towards during the past few years, we are now beginning to steadily increase our investment in sales and marketing. Our participation in trade shows is beginning to pick up again. We have participated in person at a couple of them during recent weeks with reasonable success. Customer food traffic at these shows were not back to pre-pandemic levels, but they are reasonable and created multiple newer leads. We are now looking forward to participating in person at the high-tech and G2 events during the coming months. In addition, we have a virtual customer user conference, a next-gen hospitality event, going on this week, as we speak with hundreds of customer users attending. We are excited to have all these opportunities to relaunch Agilysys, a company which has always been known for trusted and solid hospitality software solutions and great customer service. Now also having the most modern cloud technology available those clustered solutions are now based on. Our current marketing tagline trusted solutions, modern technology summarizes it very well. Getting started on this new Agilysys 2.0 journey is a great feeling. We recently added Justin Reynolds, a strong sales leader in Australia to head business development efforts in the Australia and New Zealand regions, where we have had InfoGenesis POS implemented at several sites for many years, but was only represented through a reseller. We ended that reseller relationship in Australia and in fact, another one in the UK as well, at the end of calendar 2020, and have started building direct relationships with all customers. Justin has deep relationships within the hospitality industry in Australia and New Zealand, and will help us grow our business across all our product offerings, not just POS. In addition, we have added three quota carrying sales personnel during recent months in the U.S. We will continue expanding our sales and marketing staffing levels as our revenue levels improve. With that, let me hand the call over to Dave for further color on our business progress and a more detailed commentary on our financial results. Over to you, Dave.

Thank you, Ramesh. Taking a look at our financial results, beginning with the income statement, first quarter of fiscal 2022 revenue was $38.7 million, a 29.9% increase from total net revenue of $29.8 million in the comparable prior year period. The increase in top-line revenue largely reflects a 68.8% increase in product revenue and a 63.9% increase in professional services revenue. Recurring revenue increased by 13.2% compared to the prior year period. Q1 FY2022 also represented a 6.6% sequential increase over the fiscal fourth quarter of 2021, with all three product lines increasing sequentially over the prior quarter. When comparing to the pre-pandemic period of fiscal 2020, we are encouraged that the current quarter has returned to similar levels of revenue and sales as the comparative 2020 quarter, while the total backlog is at record levels. Total recurring revenue represented 59.9% of total net revenues for the fiscal first quarter compared to 68.8% of total net revenue in the comparable prior year period. Recurring revenue of $23.2 million is a record, $2.7 million higher than the prior year and up $300,000 sequentially. We are also pleased with our subscription revenue growth, which grew year-over-year 33.2% during the first quarter of fiscal 2022 to a record $10.2 million. This also represents a growth of 44.7% over the first quarter of fiscal 2020. As a reminder, subscription revenue in Q1 fiscal 2021 was negatively impacted by several one-time items. Subscription revenue comprises around 44% of total recurring revenues compared to about 37% of total recurring revenues in the first quarter of fiscal 2021. Add-on software modules that build out our product ecosystem beyond the core point of sale, property management, and inventory procurement offerings are adding scale quickly and are now contributing to 8% of total sales this quarter, when less than two years ago, the add-on modules were not a meaningful contributor to sales. We have added over $1 million in ARR to increase new products in each of the last five quarters. Add-on software modules made up 9.7% of our subscription revenue in our fiscal first quarter of 2022. Moving down the income statement, gross profit was $24.8 million, compared to $18.6 million in the first quarter of fiscal 2021. Gross profit margin increased to 64.2% compared to 62.2% in the prior year period. This gross profit increase was primarily due to a better revenue mix. Recurring revenue continues at record levels while products and professional services revenues continue to increase but have not yet fully returned to pre-pandemic levels. Product and professional services revenue are up 15.7% sequentially when compared to Q4 fiscal year 2021. Moving to operating expenses. Operating expenses, excluding charges for legal settlements, impairment, and restructuring, severance and other charges, the first quarter saw a substantial sequential decrease of 53% over Q4 2021, mostly due to the reduction in stock-based compensation expenses. Compared to the prior year, operating expenses saw a 27% increase to $22.6 million from $17.8 million. This year-over-year increase in operating expenses was due to temporary reductions, which were in place last year and costs coming back into the business post-COVID. Product development, sales and marketing, and general and administrative expenses were 56% of revenue for both this quarter and the first quarter of fiscal year 2021. Compared to Q1 fiscal 2020 and without the impact of stock-based compensation, our normal operating expenses decreased by $1.9 million despite the higher revenue levels in the current quarter. Without the impact of increased stock-based compensation, product development, sales and marketing, and general and administrative expenses were 46% of revenue this quarter. Our net income of $1.5 million is a significant improvement to the prior year's fourth quarter loss of $24.7 million with earnings per share improving to $0.06 compared to a loss of $1.05 in the fourth quarter of fiscal year 2021. Adjusted net income and adjusted diluted earnings per share both show significant improvement over the prior year's first quarter. Adjusted net income of $5.2 million compares favorably to $1.9 million in the prior year's first quarter and adjusted diluted earnings per share of $0.21 compares favorably to $0.08 in the prior year's first quarter, when normalizing for certain non-cash and non-recurring charges. For the fiscal 2022 first quarter, adjusted EBITDA was $6.9 million compared to $3.4 million in the year ago quarter. The adjusted EBITDA improvement continues to represent the overall health of the business and operating leverage created by our internal investments as revenue continues to come back to pre-pandemic levels. Moving to the balance sheet and cash flow statement, cash and marketable securities improved by $4.7 million in the first quarter of fiscal 2022. Cash and marketable securities as of June 30, 2021, was $103.9 million compared to $99.2 million on March 31, 2021. Free cash flow in the quarter was a positive $7.7 million compared to a loss of $5.2 million in the prior year quarter. So in summary, our underlying business fundamentals are strong with the new products available to the market and profitability continues to be a focus and strength of the company, even as revenue growth starts to return. With that, I'd now like to turn the call back to Ramesh.

Thank you, Dave. Overall, we are happy with the result this quarter, despite many pandemic-related challenges that are remaining in the industry, especially in the managed food services vertical and international regions. We are excited about our current competitive position and are confident of a bright future. Agilysys 2.0 is in the process of being launched. We've started shifting our primary focus from R&D more towards sales and marketing, along with growing professional services and support. We continue to expect fiscal 2022 to be our best revenue year since we converted ourselves into a hospitality software solutions-focused business seven or eight years ago. We continue to expect fiscal 2022 revenue to be in the $160 million to $170 million range, with adjusted EBITDA being slightly north of 15% of revenue despite expected increased spending levels in all customer-facing areas. The hospitality sector should continue to recover as vaccination rates pick up all across the world. We are well-positioned to ride that recovery wave and take our business to higher limits. With that, Cherry, let's open up the call for Q&A.

Your first question comes from the line of Matt VanVliet from BTIG. You may now proceed.

Yes. Hi, thanks for taking the question and a great job in the quarter. I guess first on the product development side, you made a ton of progress over the last couple of years, especially as you've been pushing the SaaS products out there. And Ramesh, you mentioned a couple new products that are sort of to be released very soon. I guess, on a more forward-looking basis, are there any other major product gaps that you're eyeing that need either modernization of what you have in the portfolio already? Or is that customers are now asking about that you expect to have over the next several months?

Hi Matt, thank you for the question. No, there are no new products that we are planning. Our focus during the next year is going to be to settle down all the new software modules we've already created, settle down in the field, all the new products we've already created and all the products that have been modernized. This modernization effort has been a big effort, Matt. It takes redoing major products that have had a 10-year, 20-year, even 30-year history. So it's been a big effort. So we want to focus the next few quarters on making sure all those modules and products, all those cloud applications get settled down well in the field. Before we start thinking about what are the new enhancements and modules we need to expand our total addressable market. I guess that time will come sometime in calendar 2022, but for the next few quarters, we are focused on settling down all the work we have done in the field.

All right. And then you mentioned a few of the deployments have hit a little bit of a delay from time to time. But you expect those to be relatively short-lived. Maybe if you could just give us a little bit more color there, has it been an issue of not having people on site? Is it a customer-related issue, just maybe not fully prepared for the delivery? Or was there something more from the technical side on your end that you've now sort of straightened out?

Yes. So you summarized the two reasons well, Matt. But the overwhelming reason, the big majority of the reason why our current combined backlog product, services and recurring revenue is at a record level. The primary reason for that gap between selling and implementing before it gets converted to revenue has been the lack of resources at customer sites. Now that all of us read in the newspapers, we know that many of the properties we are working with are running short on resources and they have a whole lot of other priorities to work with as well. So that has been the overwhelming big reason for the implementation delays. So along with that, a secondary reason has also been that many of these products that we are implementing now are either new modules or have been completely modernized over the last two years or so. So as they get into the field, there are technical issues that we have found during implementation that takes a few days to a couple of weeks to sort out. That has also caused certain implementation delays. And in certain cases, that one implementation delay makes us put on hold the following implementations of the same product, because we'd rather settle it well in the first few sites that are going live before we take on all the additional sites. But I would say that is a smaller secondary reason. The big primary reason has been lack of resources at customer properties.

And then just a quick follow-up to that, you reiterated the guidance despite coming in sort of above, at least our expectations for the quarter and talking about sort of record levels of bookings and backlog here. Is there just an extra element of conservatism given the ongoing uncertainty or have some of these project delays and the delays associated with recognizing revenue just not sort of giving you that extra confidence to raise the guidance range? Thanks.

Yes, sure. So Matt, in terms of record levels of bookings. The one clarification is, this was our best Q1 quarter of sales, meaning this was our best April through June period. And the previous record was two years ago, Q1, April through June of calendar 2019, that was before the pandemic or fiscal year 2020. So this is not our best ever quarter of sales, but it is our best Q1 quarter of sales. So that's a clarification to be understood. That's number one. Number two, yes, a big part of the revenue success this year is going to depend on how quickly we clear the backlog. The record levels of backlog we have now. And that's not going to be easy because our properties are not going to get resources just like that quickly. And this phase of implementing all our new modules is going to cause a little bit of a delay going forward. So fundamentally, I mean, when we provide guidance, we are as realistic as we can be—not aggressive, not conservative. That is always our objective. Now, the one thing I will give you, Matt, is that the second half of the fiscal year, October through March, we expect a pickup, in all cases, all these products would have been well settled by now. We expect the markets to pick up. We expect the managed food services vertical to pick up as more people go back to offices. We expect international regions to pick up as vaccination rates continue to increase. So we do expect a pickup between October and March, which is the second half of the fiscal year. We just don't know how good that pickup is going to be yet. Is it going to be delayed by a couple of months, is it going to come ahead by a month or so in September, we just don't have a good enough feel for that. We do expect the second half of the year to be better than the first half of this fiscal year. We just don't have a good enough feel for how much that increase is going to be. So our current guidance is a realistic reflection of where we think we'll end up this year.

All right, great. Thank you for taking all the questions. I appreciate it.

Thank you, Matt.

Your next question comes from the line of Nehal Chokshi from Northland Capital. Your line is now open.

Great. Thank you. Great quarter, amazing free cash flow. It looks like that's been driven by great day sales outstanding. So that's actually my first question. Is this DSO level sustainable?

Nehal, yes. The DSO levels are sustainable. I mean, we obviously had a lot of turmoil last year, but they've kind of settled into the range as they are now. And like we've talked about the working capital adjustments on free cash flow, really smoothed out over a 12-month period, but the DSOs are in the—and the DPOs are right where we'd like them to be. And so yes, the free cash flow is sustainable.

Great. So then how should we be thinking about free cash flow relative to the effectively I think it's a $25 million that the guidance for the year?

Yes. Over the year it'll smooth out and be near the same number. I mean, you'll have some CapEx adjustments against that, but the working capital will smooth itself out. So keep in mind, Q3 is typically our—it's the bumpiest quarter with some large annual invoices that go out, but over the year, it'll smooth out. So it will be relatively close to the profitability guidance.

Okay, great. And then normalizing for the one-time events in the year-ago quarter, how did subscription revenue fare on a year-over-year basis? I know on an as-is basis, it was up 33% year-over-year. And you may have said this in the transcript. I just didn't catch it.

Yes. So it was right around the 20%. I mean, a lot of the quarters in fiscal year 2021 had one-time noise but there was also several other one-time lumpiness in the quarters with cash collectability and larger deferrals. But if you take out most of that noise, it was around the 20% growth we're used to. So year-over-year, Nehal you should expect subscription revenue to be around the 20% higher than the previous year when you add up all the quarters of a year—when you add up all the four quarters of the fiscal year and compare it to the previous fiscal year, it will end up around the 20% mark we think.

Okay, great. My last question is that I know that you've said backlog is at record levels across product, service and then subscription maintenance and support. But within the subscription maintenance support, does that include subscription being backlog at record levels as well?

Yes, Nehal. So the subscription revenue is near record levels and the professional services is at record levels. So the comp—with the combination of all three is at a record level. But yes, the subscription revenue is at near record levels as well.

And is part of that recurring revenue number image.

Yes. That's correct.

Yes. Absolutely. Okay, great. Thank you.

Thanks, Nehal.

Your next question comes from the line of George Sutton from Craig-Hallum. Your line is now open.

Thank you. I did hop on late. It sounded like you were getting a lot of quantitative questions. So, Ramesh, I wanted to ask you some qualitative questions. You on your message to your customers today at your conference mentioned, you're the most relaxed and happy you have ever been. Just wondered if we can get a perspective of that along with the fact that you now have backward compatibility and software is no longer a constraint. It just seems like a pretty big message in terms of where you've come from and where you are now. And I just wanted to think of it from that angle.

Sure, George. I'm not typically the kind of guy who is ever relaxed and happy, but what I've meant was relatively, I'm more relaxed and happy now. What I meant was in all these user conferences since 2017, George, you always make future promises. You say we are going to invest in R&D, we are going to modernize our products. We've always been known for trusted solutions. We've always been known for great customer service. But our products have been old and that's been the truth. So since 2017, you promised that you're going to do this, you're going to modernize it. And you always feel happy when you deliver on that promise. So hereafter in these user conferences, we don't need to talk about the future that much, we can talk about the present. And that's always a much better state than standing there and saying we are going to do this, we are going to do that. Now we can say we have done it. And we have kept our promises. Now you can depend on us for both cloud-based applications and for on-premise applications and both of them are based on world-class technology. So we have reached that stage, and that is what I meant by it is far easier to do these presentations now. And we feel that in demos, George, when we do demos and we do Agilysys overview with customers, it's 10x easier now than it was two years ago because we are talking about the present. And you're telling customers, all we need from you is a chance. Please take a look at the demos. That's all we need. You don't need to depend on any future promises or anything. So that's what I meant. Now, as far as the backward compatibility that we talked about today, George in the event in the next-generation event we had is what we mean is the IG POS terminal modernization we have done is a big deal because now out of one code base, we support all the operating systems, iOS, Android, and Windows of one code base. So we don't need a third-party vendor dependency. We don't need all of that. Along with that, customers have the ability to upgrade two of their devices but leave the rest of it on an older version. That's not the kind of backward compatibility all our competitive vendors provide. It is normally a heavy lift. Sometimes they even force them to change the hardware, while whatever we do, we make sure we protect customers' investments as much as we can. So that too is a big deal, so happy about that as well.

Got you. Just looking forward to HITEC and G2E in terms of what kind of presence you anticipate having at those events? Obviously, I don't believe either of those really happened last year. And are those going to be live events? And do you think you're going to get the demo numbers that you would hope to get?

I think so, George, we are definitely going to be there in full force and we are looking forward to an in-person event. And the couple of shows we attended over the last few weeks, the attendance has been down compared to pre-pandemic levels. But we think HITEC and G2E are going to be very well attended. All the vendor partners, all our peers and competitors and everyone else in the gaming industry and in the hospitality industry are all eagerly looking forward to participating here. And our feeling is unless there is some bad news again of things going backward, we think there is going to be very good presence from the customer end. And we are definitely going to be there in full force, ready to demo our entire range of products. There won't be any trace of old technology shown there in our booth. So we are looking forward to that.

Got you. Great. Thank you.

Thank you, George.

I am showing no further questions. We have Allen Klee from Maxim Group. Your line is now open.

Yes. Good afternoon. Question is on how you're thinking about your expenses in terms of how they're going to grow throughout the year? And then somewhat related to that status of your hiring at the India Development Center and maybe a little color of just how things are in India? Thank you very much.

Yes. After the second—well, hi, Allen. After the second wave, things have stabilized well in India. In fact, I was there for a couple of weeks — a couple of weeks ago. So I spent a couple of weeks there as well. Things have settled down very well in India. We are still working remote for the most part in our India Development Center, but things are coming back to normalcy a lot faster than we thought during that second wave. Now, as far as expenses are concerned, I'll give you a higher picture answer, Allen, and then I'll hand it over to Dave. So starting from now in general, you should see our R&D product development level of expenses stabilizing around where we are today. There could be some increase when incentive comp increases when we have better and better years. And you always have the run rate. We built it up to a certain extent that run rate issue is there. But when you take this quarter's product development expenses, we should be stabilizing R&D around that area for the next foreseeable future, right? For the next—as we take this company forward in revenue, we don't require any big increase in R&D expenses. And you should expect the sales and marketing expenses as a percentage of revenue to gradually increase over a period of time. So the fact that we save in R&D as a percentage of revenue, by the way, Allen, we are not reducing R&D, but we are not going to increase it any further. We have a lot of operating leverage in R&D now, and part of that saving as a percentage of revenue should go towards sales and marketing and should go towards increasing our profitability levels over a period of time. Now, as far as the India Center is concerned, we are pretty much close to peak size now. We're probably about 30 or 40 people short compared to the capacity we have. And I think we’ll be stabilizing there for the foreseeable future. No major hiring coming up in R&D and in our India Development Center anytime in the near future. Now, our attention is more on increasing sales and marketing side.

No. I agree, Allen. I mean, I think last year was obviously a little bit lumpy when you look at some of our OpEx as a percentage of revenue. But now we’ve kind of normalized out the stock-based compensation, I think you'll see us go back to ranges you're more familiar with. For example, G&A will probably remain in the 14% to 16% of revenue, product development will start coming down into the 28%, 29% of revenue, and sales and marketing will start to come up 10% to 12% of revenue. So we'll start working back toward the percentages you're kind of used to with product development coming down, and like Ramesh said, adding a little bit more here and there to sales and marketing.

Thank you.

Thank you, Allen.

I am showing no further questions at this time. I would now like to turn the conference back to Ramesh.

Thank you, Cherry. Thank you for all your continued interest in Agilysys. On behalf of our Board, management team, and close to 1,400 team members, I'm grateful for your investments in Agilysys and for your attendance today. Please take good care. Thank you.

This concludes today's conference call. Thank you all for your participation. You may all disconnect.