0KGE.L
Paychex Inc
Q1 2026 Report
Paychex Inc (0KGE.L) QQ1 2026 Results: Revenue Growth, Robust Free Cash Flow and Margin Stability...
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Executive Summary
For the second quarter of fiscal 2025, Paychex Inc reported revenue of $1.316 billion, marking a 4.69% increase year-over-year, albeit a slight decrease of 0.12% compared to the previous quarter. Despite facing market headwinds, the company demonstrated a robust operating income growth of 6.30% YoY, reflecting effective cost management strategies. The earnings per share (EPS) increased by 5.50% YoY to $1.15, showcasing the company's solid profitability fundamentals.
Management highlighted that continued investment in technology and expanded service offerings are critical drivers of sustainable growth. The integration of AI in HR solutions and enhanced customer support were noted as significant developments, positioning Paychex favorably in the evolving landscape of human capital management services. Investors should pay close attention to these strategic initiatives going forward as they hold the potential to further boost operational efficiency and client engagement.
Key Performance Indicators
Revenue
1.32B
QoQ: -0.12% | YoY:4.69%
Gross Profit
937.80M
71.21% margin
QoQ: -0.07% | YoY:4.92%
Operating Income
538.10M
QoQ: -1.57% | YoY:6.30%
Net Income
413.40M
QoQ: -3.28% | YoY:5.27%
EPS
1.15
QoQ: -3.36% | YoY:5.50%
Revenue Trend
Margin Analysis
Key Insights
- **Total Revenue**: $1.316 billion, a 4.69% increase from Q2 2024. The slight 0.12% quarterly decline indicates some seasonal variability in demand.
- **Gross Profit**: $937.8 million, with a gross margin of 71.21%, showing consistent efficiency in operations.
- **Operating Income**: $538.1 million, representing a 6.30% YoY improvement, albeit a 1.57% decline QoQ, reinforcing a solid operational performance despite slight quarterly pressure.
- **Net Income**: $413.4 million, increasing by 5.27% YoY, although down 3.28% from the previous quarter, indicating challenges with market fluctuations.
- **EPS**: $1.15, a robust growth of 5.50% YoY, demonstrating strong earnings retention.