UKG continues to see good demand for its subscription cloud products from new and existing customers, driving that segment?s growth mid-teens percent in fiscal 2024 (ended September 2024). This bumped up UKG's revenue growth to high-single-digit percent year over year in fiscal 2024 and improved recurring revenue to high-80%. However, over the next fiscal year, we anticipate slower revenue growth of mid-single-digit percent due to weaker end-customer demand. We expect customers to delay decisions on new solutions and upsell opportunities on non-artificial intelligence (AI) solutions, as they look to invest more budget into AI. In anticipation of slower revenue growth, UKG optimized its cost structure to match weaker demand. UKG enacted a large cost-savings plan in the third quarter of
