By Adriano Marchese
Paychex raised its adjusted earnings outlook, driven by strong momentum across its AI‑powered product suite.
The human resources, payroll, and employee‑benefits outsourcing company on Friday upgraded its targets for adjusted earnings per share growth. It now anticipates a growth range of 10% to 11%, up from a previous 9% to 11%.
Chief Executive John Gibson credits the rosier outlook to the company's recent advancements in agentic artificial intelligence payroll automation to GenAI-powered advisory tools.
"These AI-driven solutions are enhancing client satisfaction, improving operational efficiency, and positioning Paychex for the next era of AI-enabled human capital management," Gibson said..
For the three months ended Nov. 30, Paychex generated total revenue that rose 18% to $1.56 billion, just above analyst expectations of a rise to $1.55 billion, according to FactSet.
Net income fell to $395.4 million, or $1.10 a share, down from $413.4 million, or $1.14 a share, in the same quarter a year ago.
Total expenses in the quarter rose 27% to $985.7 million, the company said, due primarily to costs related to the acquisition of HR and payroll software company Paycor, which was completed in mid-April, as well as higher technology, selling, and marketing investments.
Adjusted earnings, which strips out exceptional costs and one-off items, came to $1.26 a share. According to FactSet, analysts were expecting $1.23 a share.
Management solutions revenue increased 21% to $1.2 billion, which Paycor contributed about 17% to the segment, it said, while professional employer organization and insurance solutions revenue increased 6% to $336.9 million.
Write to Adriano Marchese at adriano.marchese@wsj.com
(END) Dow Jones Newswires
December 19, 2025 09:06 ET (14:06 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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