Paycom Software(PAYC) - 2024 Q4 - Annual Results

Financial Performance - Full Year Revenues reached $1,883 million, an increase of 11% year-over-year[1] - Fourth Quarter Revenues were $494 million, up 14% year-over-year[1] - GAAP Net Income for the Full Year was $502 million, or $8.92 per diluted share, compared to $340.8 million, or $5.88 per diluted share last year[6] - Adjusted EBITDA for the Full Year was $775 million, representing 41% of total revenues[1] - Total revenues for the year ended December 31, 2024, increased to $1,883.2 million, up 11.2% from $1,693.7 million in 2023[26] - Net income for the year ended December 31, 2024, reached $502.0 million, representing a 47.2% increase compared to $340.8 million in 2023[26] - Net income for Q4 2024 was $113.6 million, up 39% from $81.8 million in Q4 2023, with a full-year net income of $502.0 million compared to $340.8 million in 2023[32] - Adjusted EBITDA for Q4 2024 reached $214.9 million, a 21.7% increase from $176.6 million in Q4 2023, with a full-year adjusted EBITDA of $775.4 million, up from $719.3 million[32] - Total revenues for Q4 2024 were $493.8 million, representing a 13.5% increase from $434.6 million in Q4 2023, with full-year revenues of $1,883.2 million compared to $1,693.7 million in 2023[33] Client and Revenue Metrics - Total client count as of December 31, 2024, was 37,543, a 2% increase from the prior year[10] - Annual revenue retention rate for 2024 was 90%, consistent with the prior year[10] - Expected Total Revenue for 2025 is projected to be between $2.015 billion and $2.035 billion, approximately 8% growth at the midpoint[12] - Recurring and other revenue growth for 2025 is anticipated to be approximately 9% year-over-year[12] Cash and Assets - Cash and Cash Equivalents as of December 31, 2024, were $402 million, up from $294 million as of December 31, 2023[5] - Cash and cash equivalents at the end of 2024 were $402.0 million, up from $294.0 million at the end of 2023, reflecting a 36.8% increase[30] - Total assets grew to $5,859.9 million as of December 31, 2024, compared to $4,197.5 million in 2023, marking a 39.6% increase[24] - Net cash provided by operating activities for the year ended December 31, 2024, was $533.9 million, compared to $485.0 million in 2023, an increase of 10.1%[28] Expenses and Liabilities - Research and development expenses for the year ended December 31, 2024, were $242.6 million, up from $199.0 million in 2023, reflecting a 21.8% increase[26] - The company’s total liabilities increased to $4,284.0 million in 2024 from $2,894.5 million in 2023, a rise of 48.0%[24] - Total administrative expenses for Q4 2024 were $261.7 million, up from $253.2 million in Q4 2023, with adjusted total administrative expenses as a percentage of revenues at 48.9% compared to 51.0% in Q4 2023[33] Earnings and Margins - Earnings per share (diluted) for the year ended December 31, 2024, were $8.92, compared to $5.88 in 2023, an increase of 51.8%[26] - Basic earnings per share for Q4 2024 was $2.03, an increase from $1.43 in Q4 2023, with full-year earnings per share of $8.93 compared to $5.91 in 2023[32] - The net income margin improved to 23.0% in Q4 2024 from 18.8% in Q4 2023, while the adjusted EBITDA margin increased to 43.5% from 40.6%[32] - The company reported a gross margin of 83.1% in Q4 2024, slightly up from 82.8% in Q4 2023, with an adjusted gross margin of 83.6% compared to 83.3%[33] Research and Development - Adjusted research and development expenses for the year ended December 31, 2024, were $216.3 million, up 22.4% from $176.7 million in 2023[34] - Total research and development costs as a percentage of revenues increased to 19.6% for the year ended December 31, 2024, from 17.5% in 2023[34] - Capitalized research and development costs for the year ended December 31, 2024, were $125.7 million, an increase of 30.0% from $96.7 million in 2023[34] - Total research and development expenses for the three months ended December 31, 2024, were $66.7 million, compared to $55.3 million in the same period of 2023, representing a 20.3% increase[34]