Group 1 - The Ademi Firm is investigating Dayforce for possible breaches of fiduciary duty and other legal violations related to its transaction with Thoma Bravo [1] - Dayforce shareholders will receive $70.00 per share in an all-cash transaction valued at approximately $12.3 billion [1]

Core Insights - Dayforce, Inc. has been recognized as a Leader in the 2025 Gartner Magic Quadrant for HCM Suites for 1,000+ Employees Enterprises for the sixth consecutive year, highlighting its strong Ability to Execute and Completeness of Vision [1][3] Company Overview - Dayforce operates globally across North America, Europe, the Middle East, Africa, and Asia-Pacific, providing a single AI-powered people platform for HR, Pay, Time, Talent, and Analytics [2] - The company serves over 6,980 customers, including notable organizations such as OTG Management, Swissport, Orica, and the Kansas City Chiefs [2] Strategic Focus - Dayforce aims to simplify operational complexities for its customers, emphasizing the importance of operational efficiency and the effective use of AI to enhance productivity [3] - The platform offers organizations a single source of truth for people data, enabling real-time insights and data-driven decision-making [3] Value Proposition - The AI-powered platform is designed to help businesses maximize workforce productivity, operate confidently, and achieve quantifiable value [3][7] - Dayforce's commitment to improving work life for its customers and their employees is reinforced by its consistent recognition in the Gartner Magic Quadrant [3]

Core Insights - Dayforce, Inc. announced a significant expansion of its Dayforce Flex Work solution, which now includes a comprehensive contingent management platform for frontline workforces, enabling customers to manage their entire talent ecosystem efficiently [1][3] - Research indicates a strong market demand for flexible work arrangements, with 86% of workers willing to change jobs for better scheduling flexibility and 65% of executives seeking easier access to skilled temporary staff [2] Company Developments - The enhanced Dayforce Flex Work solution aims to create a unified workforce model, allowing organizations to adapt quickly to labor needs and manage various worker types, including full-time, part-time, and contingent workers [3] - Dayforce's recent acquisition of JJJ International, which includes the Jitjatjo and Network brands, enhances its capabilities in on-demand staffing and vendor management systems [5] Customer Impact - SSA Group, a hospitality management company and Dayforce customer, reported measurable benefits from implementing the Dayforce Flex Work solution, including improved operational flexibility and cost control [4] Key Features - Dayforce Flex Work offers capabilities to streamline contingent workforce management, automate programs, and provide access to a large pool of frontline workers through a mobile-first experience [6]

Core Viewpoint - Wohl & Fruchter LLP is investigating the fairness of the sale of Dayforce Inc. to Thoma Bravo for $70.00 per share, which is below its 52-week high of $82.69, suggesting an opportunistic purchase [1][3]. Group 1: Sale Details - Dayforce announced on August 21, 2025, that it agreed to be sold to Thoma Bravo for $70.00 per share in cash [3]. - The sale price is significantly lower than Dayforce's 52-week high of $82.69 per share, indicating potential undervaluation [1][3]. Group 2: Investor Sentiment - At least one investor expressed disappointment regarding the sale price on SeekingAlpha, indicating a belief that the company could have fetched a higher multiple [1][3]. - The investigation aims to determine if the Dayforce Board of Directors acted in the best interests of shareholders and if all material information about the transaction was disclosed [3]. Group 3: Legal Representation - Wohl & Fruchter LLP has a history of representing investors in litigation related to corporate misconduct and has recovered substantial damages for investors [4]. - Shareholders questioning the fairness of the sale price are encouraged to contact Wohl & Fruchter LLP for legal advice at no charge [2].

Core Viewpoint - Rowley Law PLLC is investigating potential securities law violations by Dayforce, Inc. and its board of directors regarding the proposed acquisition by Thoma Bravo, which values the transaction at approximately $12.3 billion [1]. Group 1: Acquisition Details - Dayforce, Inc. stockholders will receive $70.00 for each share they hold as part of the acquisition [1]. - The acquisition transaction is expected to close in early 2026 [1]. Group 2: Legal Investigation - Rowley Law PLLC is representing shareholders in the investigation concerning the acquisition [1]. - Additional information regarding the investigation can be obtained through Rowley Law PLLC's website or by contacting their office directly [2].

Group 1 - Proactive provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The news team covers medium and small-cap markets, as well as blue-chip companies, commodities, and broader investment stories [3] - Proactive has a presence in key finance and investing hubs with offices in London, New York, Toronto, Vancouver, Sydney, and Perth [2][3] Group 2 - The company utilizes technology to enhance workflows and has adopted automation and software tools, including generative AI, while ensuring all content is edited and authored by humans [4][5] - Proactive produces around 50,000 pieces of real-time news, feature articles, and filmed interviews annually [1]

Core Insights - Dayforce (DAY) reported Q2 2025 earnings of 61 cents per share, exceeding the Zacks Consensus Estimate of 52 cents, marking a 27.1% year-over-year increase [1] - Revenues reached $464.7 million, surpassing the Zacks Consensus Estimate by 1.5%, and increased by 9.8% year-over-year [1] - Shares experienced a decline of 1.02% at the time of reporting [1] Revenue Details - Recurring revenues, which constitute 84.6% of total revenues, grew by 7.7% year-over-year to $393.1 million [2] - Excluding float revenues, recurring revenues totaled $315.5 million, reflecting a robust 13.6% year-over-year growth [2] - Total revenues, excluding float, were $417.3 million, an increase of 11.5% year-over-year [1] Customer Metrics - Recurring revenue per customer was $171,075 for the trailing 12 months ending June 30, 2025, showing a year-over-year increase of 10.4% [3] - The number of live customers on the Dayforce platform reached 6,984, representing a year-over-year growth of 4.9% [3] - Powerpay's recurring revenues remained unchanged year-over-year at $19.9 million [3] Operating Performance - Selling and marketing expenses in Q2 2025 were $83.7 million, up 1.6% year-over-year [4] - General and Administrative expenses decreased by 0.2% year-over-year to $58.9 million [4] - Adjusted EBITDA was $147.2 million, reflecting a 26.6% year-over-year increase, with an adjusted EBITDA margin of 31.7%, up 420 basis points [4] Financial Position - As of June 30, 2025, cash and cash equivalents were $625.2 million, an increase from $557.3 million as of March 31 [5] - Cash provided by operating activities was $112.7 million, up from $49.6 million in the prior quarter [5] - Free cash flow was reported at $87.1 million, compared to $19.5 million in the previous quarter [5] Guidance - For Q3 2025, Dayforce expects total revenues of $476-$486 million, with total revenue excluding float projected between $434 million and $444 million [8] - The company anticipates adjusted EBITDA margin to be between 30% and 30.5% for Q3 2025 [8] - For the full year 2025, total revenues are expected to be between $1.935 billion and $1.955 billion [9] Future Projections - Total revenues, excluding float, are projected to be in the range of $1.749 billion to $1.769 billion, indicating a year-over-year increase of approximately 12.1% to 13.4% [9] - Recurring revenues, excluding float, are expected to be between $1.324 billion and $1.344 billion, reflecting a growth of approximately 14.2% to 15.9% [9] - Float revenues for 2025 are anticipated to be $186 million [9]

Core Viewpoint - Dayforce (DAY) reported quarterly earnings of $0.61 per share, exceeding the Zacks Consensus Estimate of $0.52 per share, and showing an increase from $0.48 per share a year ago, representing an earnings surprise of +17.31% [1][2] Financial Performance - The company achieved revenues of $464.7 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.41%, compared to $423.3 million in the same quarter last year [2] - Over the last four quarters, Dayforce has consistently exceeded consensus EPS estimates [2] Stock Performance - Dayforce shares have declined approximately 26.8% since the beginning of the year, while the S&P 500 has gained 7.1% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating expectations of outperforming the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.57, with projected revenues of $481.73 million, and for the current fiscal year, the EPS estimate is $2.30 on revenues of $1.94 billion [7] - The outlook for the industry, specifically the Internet - Software sector, is favorable, ranking in the top 32% of over 250 Zacks industries, which historically outperform the bottom 50% by more than 2 to 1 [8]

PART I. FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) The unaudited condensed consolidated financial statements for Q2 2025 reflect revenue growth, net income, and balance sheet shifts, influenced by an efficiency plan [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets decreased to **$8.50 billion**, liabilities decreased, and stockholders' equity increased Condensed Consolidated Balance Sheet Highlights (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$8,500.8** | **$9,117.0** | | Cash and equivalents | $625.2 | $579.7 | | Customer funds | $4,259.5 | $5,001.5 | | Goodwill | $2,382.8 | $2,336.7 | | **Total Liabilities** | **$5,798.5** | **$6,570.7** | | Customer funds obligations | $4,250.1 | $5,024.2 | | Current portion of long-term debt | $582.3 | $7.3 | | Long-term debt, less current portion | $631.8 | $1,209.1 | | **Total Stockholders' Equity** | **$2,702.3** | **$2,546.3** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2025, total revenue grew to **$464.7 million**, operating profit increased, and the company achieved a net income of **$21.3 million** Q2 Financial Performance (in millions, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenue | $464.7 | $423.3 | | Operating Profit | $42.3 | $14.1 | | Net Income (Loss) | $21.3 | $(1.8) | | Diluted EPS | $0.13 | $(0.01) | Six-Month Financial Performance (in millions, except per share data) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total Revenue | $946.5 | $854.8 | | Operating Profit | $73.3 | $54.8 | | Net Income | $36.2 | $5.3 | | Diluted EPS | $0.22 | $0.03 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For H1 2025, operating cash flow increased to **$162.3 million**, with significant cash used in investing and financing activities, leading to a net decrease in cash Six-Month Cash Flow Summary (in millions) | Cash Flow Activity | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $162.3 | $108.3 | | Net cash used in investing activities | $(180.3) | $(383.5) | | Net cash (used in) provided by financing activities | $(919.5) | $7.7 | | **Net decrease in cash, restricted cash, and equivalents** | **$(912.6)** | **$(289.2)** | - Significant cash outflows from financing activities in H1 2025 included a **$854.2 million** decrease in customer funds obligations and **$50.9 million** in common stock repurchases[29](index=29&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies, segment information, and financial statement items, covering an efficiency plan, customer funds, debt, and share repurchases - On February 26, 2025, the company announced an efficiency plan involving a **5% workforce reduction**, incurring restructuring charges of **$31.9 million** in the first six months of 2025[42](index=42&type=chunk) Investment Income from Customer Funds (Float Revenue, in millions) | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | $47.4 | $48.9 | | Six Months Ended June 30 | $102.7 | $109.6 | - As of June 30, 2025, total debt was **$1.22 billion**, including **$643.5 million** in Term Debt and **$575.0 million** in Convertible Senior Notes due March 2026, which are now classified as current debt[62](index=62&type=chunk)[72](index=72&type=chunk) - As of June 30, 2025, the company has approximately **$1.43 billion** in remaining performance obligations (backlog), expected to be recognized as revenue over the next three years[95](index=95&type=chunk) - Under its **$500 million** share repurchase program, the company purchased **882,968 shares** for a total cost of **$51.2 million** in the first six months of 2025[110](index=110&type=chunk)[111](index=111&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses revenue growth from Dayforce customers, analyzes operating expenses, assesses liquidity, and provides non-GAAP financial measure reconciliations [Overview](index=29&type=section&id=Overview) The company's business model focuses on recurring revenue from its Dayforce and Powerpay HCM solutions, sold on a subscription PEPM basis - The company's business model is centered on recurring revenue from its Dayforce and Powerpay HCM solutions, sold on a subscription PEPM basis, typically with initial contract terms of three to five years[113](index=113&type=chunk)[114](index=114&type=chunk) - It takes approximately **two years** to recover the initial implementation and customer acquisition costs for a new Dayforce customer contract[115](index=115&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) For Q2 2025, total revenue grew **9.8%** to **$464.7 million**, driven by Dayforce customer growth, with operating profit surging **200%** Q2 2025 vs Q2 2024 Revenue Growth (in millions) | Revenue Stream | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $464.7 | $423.3 | 9.8% | | Recurring Services | $393.1 | $365.0 | 7.7% | | Professional Services | $71.6 | $58.3 | 22.8% | - Revenue growth was driven by a **4.9% increase** in live Dayforce customers (to **6,984**) and a rise in Dayforce recurring revenue per customer to **$171,075** for the trailing twelve months[128](index=128&type=chunk) - Float revenue decreased in Q2 2025 due to a **40 basis point drop** in average yield, despite a **7.2% increase** in the average float balance to **$5.08 billion**[129](index=129&type=chunk) - For H1 2025, total revenue grew **10.7%** to **$946.5 million**, and operating profit increased **33.8%** to **$73.3 million** compared to H1 2024[143](index=143&type=chunk)[145](index=145&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity, supported by **$625.2 million** in cash and operating cash flow, is deemed sufficient, despite significant cash usage in financing activities - As of June 30, 2025, the company had cash and equivalents of **$625.2 million** and total debt of **$1,224.6 million**[161](index=161&type=chunk) - Management believes existing cash, operating cash flow, and available credit will be sufficient to meet liquidity needs for the foreseeable future[164](index=164&type=chunk) Six-Month Cash Flow Summary (in millions) | Activity | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $162.3 | $108.3 | | Net cash used in investing activities | $(180.3) | $(383.5) | | Net cash (used in) provided by financing activities | $(919.5) | $7.7 | [Non-GAAP Financial Measures](index=41&type=section&id=Non-GAAP%20Financial%20Measures) The company uses non-GAAP measures like Adjusted Operating Profit and Free Cash Flow, with Q2 2025 Adjusted Operating Profit at **$124.9 million** and H1 2025 Free Cash Flow nearly doubling Reconciliation of Operating Profit to Adjusted Operating Profit (in millions) | | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Operating profit (GAAP) | $42.3 | $14.1 | | Share-based compensation | $48.4 | $40.8 | | Amortization | $31.1 | $29.5 | | Other adjustments | $3.1 | $10.5 | | **Adjusted operating profit (Non-GAAP)** | **$124.9** | **$94.9** | Free Cash Flow (in millions) | | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $162.3 | $108.3 | | Capital expenditures | $(55.7) | $(54.4) | | **Free cash flow (Non-GAAP)** | **$106.6** | **$53.9** | [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=46&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces market risks from foreign currency, interest rate fluctuations impacting float revenue and debt expense, and pension obligations - The company's primary market risks are foreign currency (Canadian Dollar), interest rates, and pension obligations[188](index=188&type=chunk) - A **100 basis point decrease** in market investment rates would result in an estimated **$27 million** decrease in annual float revenue[192](index=192&type=chunk) - A **100 basis point decrease** in applicable reference rates would lead to an approximate **$6 million** decrease in annual interest expense on its Term Debt[193](index=193&type=chunk) - The company is finalizing the wind-down of its U.S. pension plan, with liabilities expected to be transferred to an insurance company in 2025[197](index=197&type=chunk) [Item 4. Controls and Procedures](index=47&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective at a reasonable assurance level[199](index=199&type=chunk) - No changes were made to internal control over financial reporting during the six months ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, these controls[200](index=200&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=48&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings expected to have a material adverse effect on its business, financial condition, or liquidity - The company is not presently a party to any legal proceedings that it believes would have a material adverse effect on its business[203](index=203&type=chunk) [Item 1A. Risk Factors](index=48&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024, have occurred - No material changes in risk factors have occurred since those disclosed in the 2024 Form 10-K[204](index=204&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) During Q2 2025, the company repurchased **364,059 shares** for **$20.8 million** under its **$500 million** share repurchase program, with **$412.7 million** remaining available Share Repurchases for Q2 2025 | Metric | Value | | :--- | :--- | | Total Shares Purchased | 364,059 | | Average Price Paid per Share | $57.05 | | Total Cost (in millions) | $20.8 | | Remaining Authorization (in millions) | $412.7 | [Item 5. Other Information](index=49&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated any Rule 10b5-1 trading plans or arrangements during the fiscal quarter ended June 30, 2025 - No directors or officers adopted or terminated any Rule 10b5-1 trading plans during the quarter[209](index=209&type=chunk) [Item 6. Exhibits](index=50&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer, and XBRL data

[Q2 2025 Performance and Outlook](index=1&type=section&id=Q2%202025%20Performance%20and%20Outlook) This section provides an overview of Dayforce's Q2 2025 financial and operational performance, management's strategic commentary, and future business outlook and guidance [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted strong bookings growth, emphasizing system simplification and AI advantages, and reinforced confidence in achieving the $1 billion free cash flow target by 2031 - Year-to-date bookings have grown **over 40% year-over-year**, indicating strong sales momentum[4](index=4&type=chunk) - The company believes it is well-positioned for AI due to its single-database HCM platform and strong data privacy foundation, which provides a structural advantage[4](index=4&type=chunk) - Management has increased confidence in its ability to achieve its long-term target of **$1 billion in free cash flow by 2031**[4](index=4&type=chunk) [Financial Highlights for the Second Quarter 2025](index=1&type=section&id=Financial%20Highlights%20for%20the%20Second%20Quarter%202025) Dayforce reported strong Q2 2025 growth with total revenue up 9.8% and recurring revenue up 13.6%, alongside significant profitability improvements and expanded Adjusted EBITDA margin Q2 2025 Key Financial Metrics (vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $464.7M | $423.3M | +9.8% | | Total Revenue (ex-float) | $417.3M | $374.4M | +11.5% | | Dayforce Recurring Revenue (ex-float) | $315.5M | $277.7M | +13.6% | | Operating Profit | $42.3M | $14.1M | +199.3% | | Adjusted Operating Profit | $124.9M | $94.9M | +31.6% | | Net Income (Loss) | $21.3M | ($1.8M) | N/A | | Adjusted Net Income | $98.2M | $76.2M | +28.9% | | Diluted EPS | $0.13 | ($0.01) | N/A | | Adjusted Diluted EPS | $0.61 | $0.48 | +27.1% | | Adjusted EBITDA | $147.2M | $116.3M | +26.6% | | Adjusted EBITDA Margin | 31.7% | 27.5% | +420 bps | - The number of customers live on the Dayforce platform grew to **6,984** as of June 30, 2025, a **4.9% increase year-over-year**[7](index=7&type=chunk) - For the six months ended June 30, 2025, net cash provided by operating activities was **$162.3 million**, a **significant increase from $108.3 million** in the same period of 2024. Free cash flow **nearly doubled to $106.6 million**[7](index=7&type=chunk) [Recent Business Highlights](index=2&type=section&id=Recent%20Business%20Highlights) The company secured major new customer relationships, including the Government of Canada, and delivered key product enhancements with AI-powered features and compliance updates - The Government of Canada is moving forward with Dayforce for a significant HR and Pay transformation project[15](index=15&type=chunk) - Key customer wins include a global apparel leader (**37,000 employees**) adopting the full suite and a U.S. infrastructure provider (**10,000 employees**) selecting Managed Payroll and other solutions[15](index=15&type=chunk) - Product development continued with enhancements such as AI-powered skills-based learning, mobile-first features for frontline workers, and **over 230 compliance updates**[15](index=15&type=chunk) [Business Outlook](index=2&type=section&id=Business%20Outlook) Dayforce issued Q3 and full-year 2025 guidance projecting double-digit revenue growth and raised its free cash flow margin outlook due to favorable legislative changes [Third Quarter 2025 Guidance](index=2&type=section&id=Third%20Quarter%202025%20Guidance) The company provides specific financial guidance for the third quarter of 2025, including projections for total revenue, recurring revenue, and Adjusted EBITDA margin Q3 2025 Guidance | Metric | Guidance Range | Implied Growth (GAAP) | | :--- | :--- | :--- | | Total Revenue | $476M - $486M | N/A | | Total Revenue, ex-float | $434M - $444M | 10.1% - 12.6% | | Dayforce Recurring Revenue, ex-float | $329M - $339M | 12.7% - 16.1% | | Float Revenue | $42M | N/A | | Adjusted EBITDA Margin | 30.0% - 30.5% | N/A | [Full Year 2025 Guidance](index=2&type=section&id=Full%20Year%202025%20Guidance) The company outlines its financial guidance for the full fiscal year 2025, including total revenue, recurring revenue, Adjusted EBITDA margin, and an updated free cash flow margin Full Year 2025 Guidance | Metric | Guidance Range | Implied Growth (GAAP) | | :--- | :--- | :--- | | Total Revenue | $1,935M - $1,955M | N/A | | Total Revenue, ex-float | $1,749M - $1,769M | 12.1% - 13.4% | | Dayforce Recurring Revenue, ex-float | $1,324M - $1,344M | 14.2% - 15.9% | | Float Revenue | $186M | N/A | | Adjusted EBITDA Margin | 32% | N/A | | Free Cash Flow Margin | 13.5% - 14.0% | N/A | - Free cash flow margin guidance was increased from **12.0% to a range of 13.5% to 14.0%**, reflecting the positive impact of the 'One Big Beautiful Bill Act' on future cash tax remittances[21](index=21&type=chunk) [Foreign Exchange Assumptions](index=3&type=section&id=Foreign%20Exchange%20Assumptions) The company's Q3 and FY 2025 guidance incorporates specific foreign exchange rate assumptions for the Canadian dollar, Australian dollar, and Great British pound Key Foreign Exchange Rate Assumptions for 2025 Guidance | Currency Pair | Q3 2025 Guidance Rate | FY 2025 Guidance Rate | FY 2024 Actual Rate | | :--- | :--- | :--- | :--- | | U.S. dollar to Canadian dollar | 1.38 | 1.40 | 1.37 | | U.S. dollar to Australian dollar | 1.56 | 1.56 | 1.52 | | U.S. dollar to Great British pound | 0.76 | 0.77 | 0.78 | [Financial Statements (Unaudited)](index=6&type=section&id=Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, and cash flows, for the reported periods [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Dayforce's balance sheet showed total assets of $8.50 billion, a decrease from year-end 2024, while total stockholders' equity increased Balance Sheet Summary (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and equivalents | $625.2 | $579.7 | | Total current assets | $5,314.3 | $5,983.5 | | Total assets | $8,500.8 | $9,117.0 | | Total current liabilities | $5,117.8 | $5,314.8 | | Total liabilities | $5,798.5 | $6,570.7 | | Total stockholders' equity | $2,702.3 | $2,546.3 | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2025, total revenue grew 9.8%, operating profit significantly improved, and net income turned positive at $21.3 million Statement of Operations Summary - Three Months Ended June 30 (in millions) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Total revenue | $464.7 | $423.3 | | Total costs and expenses | $422.4 | $409.2 | | Operating profit | $42.3 | $14.1 | | Net income (loss) | $21.3 | $(1.8) | | Diluted net income (loss) per share | $0.13 | $(0.01) | Statement of Operations Summary - Six Months Ended June 30 (in millions) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Total revenue | $946.5 | $854.8 | | Operating profit | $73.3 | $54.8 | | Net income | $36.2 | $5.3 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, operating cash flow increased to $162.3 million, with significant cash usage in financing activities Cash Flow Summary - Six Months Ended June 30 (in millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $162.3 | $108.3 | | Net cash used in investing activities | $(180.3) | $(383.5) | | Net cash (used in) provided by financing activities | $(919.5) | $7.7 | [Supplemental Data and Non-GAAP Measures](index=9&type=section&id=Supplemental%20Data%20and%20Non-GAAP%20Measures) This section provides supplemental financial data, including detailed revenue breakdowns, share-based compensation, and reconciliations of GAAP to non-GAAP financial measures with their explanations [Revenue Financial Measures](index=9&type=section&id=Revenue%20Financial%20Measures) Q2 2025 revenue breakdown shows Dayforce recurring revenue grew 13.6% and total revenue excluding float increased by 11.5%, while float revenue decreased Q2 2025 Revenue Breakdown (in millions) | Revenue Source | Q2 2025 | Q2 2024 | % Change (GAAP) | % Change (Constant Currency) | | :--- | :--- | :--- | :--- | :--- | | Dayforce recurring | $315.5 | $277.7 | 13.6% | 13.5% | | Float | $47.4 | $48.9 | (3.1)% | (2.9)% | | Professional services | $71.6 | $58.3 | 22.8% | 23.0% | | **Total revenue** | **$464.7** | **$423.3** | **9.8%** | **9.8%** | | **Total revenue, ex-float** | **$417.3** | **$374.4** | **11.5%** | **11.5%** | [Share-Based Compensation Expense](index=10&type=section&id=Share-Based%20Compensation%20Expense) Total share-based compensation expense increased to $48.4 million in Q2 2025 and $94.4 million for the first six months of the year Share-Based Compensation Expense (in millions) | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | $48.4 | $40.8 | | Six Months Ended June 30 | $94.4 | $78.8 | [Reconciliation of GAAP to Non-GAAP Financial Measures](index=11&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) The company provides detailed reconciliations, adjusting GAAP operating profit of $42.3 million to an adjusted $124.9 million and GAAP net income to $98.2 million Q2 2025 GAAP to Non-GAAP Reconciliation (in millions) | Metric | GAAP | Adjustments | Non-GAAP | | :--- | :--- | :--- | :--- | | Operating Profit | $42.3 | +$82.6 | $124.9 | | Net Income | $21.3 | +$76.9 | $98.2 | | EBITDA | $98.6 | +$48.6 | $147.2 (Adjusted EBITDA) | [Reconciliation of Free Cash Flow](index=13&type=section&id=Reconciliation%20of%20Free%20Cash%20Flow) Free cash flow for the six months ended June 30, 2025, was $106.6 million, representing an 11.3% margin, a significant increase from the prior year Free Cash Flow - Six Months Ended June 30 (in millions) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $162.3 | $108.3 | | Capital expenditures | $(55.7) | $(54.4) | | **Free cash flow** | **$106.6** | **$53.9** | | **Free cash flow margin** | **11.3%** | **6.3%** | [Explanation of Non-GAAP Financial Measures](index=14&type=section&id=Explanation%20of%20Non-GAAP%20Financial%20Measures) Dayforce explains its non-GAAP measures, such as Adjusted EBITDA and Free Cash Flow, as useful for evaluating operating performance and internal budgeting - Management uses non-GAAP measures to assess operating performance by excluding results of decisions outside normal business operations and for internal budgeting and forecasting[45](index=45&type=chunk) - Key non-GAAP adjustments include share-based compensation expense, amortization of acquisition-related intangible assets, and certain other items like restructuring expenses[47](index=47&type=chunk) [Forward-Looking Statements and Risk Factors](index=4&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section outlines forward-looking statements and key risk factors, including competition, security breaches, and evolving AI regulations, that could impact future results - The press release contains forward-looking statements, including financial guidance for Q3 and FY 2025, which are not guarantees of future performance[22](index=22&type=chunk) - Key identified risk factors include competition, ability to manage growth, information security breaches, reliance on strategic relationships, and failure to comply with laws and regulations, including those related to AI[22](index=22&type=chunk)[26](index=26&type=chunk)