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Benzinga
Benzinga
Business
Anusuya Lahiri

Paychex Tops Q3 Backed By Strong Selling Season; Boosts FY22 Outlook

  • Paychex Inc (NASDAQ:PAYXreported third-quarter FY22 revenue growth of 15% year-on-year to $1.28 billion, beating the consensus of $1.22 billion. Total service revenue grew 15% Y/Y to $1.26 billion.
  • Segments: Management Solutions revenue grew 13% Y/Y to $959.9 million. PEO and Insurance Solutions' revenue rose 21% Y/Y to $301.7 million.
  • The operating margin expanded by 190 bps to 44.1%.
  • Adjusted EPS of $1.15 beat the consensus of $1.05.
  • Paychex held $1.8 billion in cash and equivalents.
  • Chair and CEO Martin Mucci, "We had a strong calendar year end and selling season, delivering a record quarter for new sales revenue and maintaining high levels of client retention."
  • "Focus is shifting from operational and financial survival during the height of the pandemic back to an employee-centric focus, with attracting and retaining talent, remote work, and workplace safety being top areas of concern," Mucci added.
  • Outlook: Paychex raised the FY22 revenue growth guidance from 10% - 11% to 12% - 13%.
  • Paychex raised adjusted EPS guidance growth from 18% - 20% to 22.5% - 23%.
  • Price Action: PAYX shares traded lower by 0.09% at $132.41 on the last check Wednesday.
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