"Helping small businesses thrive has been ADP's mission since day one and we are excited to partner with Fiserv to advance this goal and to support the millions of small businesses that drive the US economy." - Maria Black
— Maria Black
03Detailed Report
ADP
Automatic Data Processing Inc
Period
Q2 2025
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 13, 2026
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Executive Summary
In Q2 2025, Automatic Data Processing Inc (ADP) reported a robust revenue growth of 8% year-over-year, totaling $5.05 billion, fueled by strong performance in both Employer Services and Professional Employer Organization (PEO) segments. Adjusted EBITDA expanded margins by 60 basis points, reflecting increased operational efficiencies and solid demand across service offerings. Notably, management reiterated their revenue guidance for the fiscal year, projecting continued growth between 6% and 7%, buoyed by a simultaneous increase in client satisfaction levels that reached an all-time high. The ongoing strategic partnerships, particularly with Fiserv, and technological advancements in artificial intelligence indicate a forward-looking growth trajectory. However, management cautioned investors about potential headwinds from foreign exchange fluctuations and a cyclical slowdown in hiring rates, which could impact the coming quarters.
ADP maintained a net profit margin of 19%, reflecting strong pricing power despite rising operational costs. With a solid current ratio of 0.99 and a quick ratio of 0.99, the organization demonstrates adequate liquidity to meet short-term liabilities. Management cites ongoing operational leverage leading to improved profitability metrics despite pressures from increased expenses associated with their WorkForce Software acquisition integration.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
5.05B
8.15%
4.46%
Gross Profit
2.31B
9.47%
4.86%
Operating Income
1.03B
-13.25%
-19.26%
Net Income
963.20M
9.65%
0.72%
EPS
2.36
10.28%
0.85%
Key Financial Ratios
Gross Profit Margin
Good
45.70%
Gross profit margin is healthy and competitive within industry standards
Operating Profit Margin
Good
20.30%
Operating margin is healthy and competitive within industry standards
Net Profit Margin
Good
19.10%
Net profit margin is healthy and competitive within industry standards
Return on Assets
Weak
1.50%
Return on assets suggests inefficient capital allocation
Return on Equity
Good
19.00%
Return on equity shows solid performance and effective asset utilization
Current Ratio
Concern
1.00
Current ratio below safe levels, potential liquidity risk