ADP (ADP) Reports Q1 Earnings: What Key Metrics Have to Say

Core Insights - Automatic Data Processing (ADP) reported a revenue of $5.18 billion for the quarter ended September 2025, reflecting a year-over-year increase of 7.1% [1] - Earnings per share (EPS) for the quarter was $2.49, up from $2.33 in the same quarter last year, exceeding the consensus estimate of $2.44 [1] Financial Performance - The reported revenue of $5.18 billion surpassed the Zacks Consensus Estimate of $5.13 billion, resulting in a surprise of +0.95% [1] - EPS also exceeded expectations with a surprise of +2.05% compared to the consensus estimate [1] - Average paid PEO worksite employees during the period was 754, slightly below the two-analyst average estimate of 757 [4] Segment Revenue Breakdown - Employer Services revenue was $3.49 billion, exceeding the average estimate of $3.45 billion, marking a +7.1% change year-over-year [4] - Interest on funds held for clients generated $286.8 million, surpassing the average estimate of $281.99 million, with a year-over-year increase of +13.2% [4] - Other revenues, excluding interest and PEO revenues, totaled $3.2 billion, exceeding the three-analyst average estimate of $3.17 billion, representing a +6.5% change year-over-year [4] - PEO revenues reached $1.68 billion, slightly above the average estimate of $1.67 billion, with a +7.2% year-over-year change [4] - PEO Services revenue was $1.69 billion, also exceeding the average estimate of $1.68 billion, reflecting a +7.2% change year-over-year [4] - Other segment revenues reported a loss of $-3.5 million, which was worse than the estimated loss of $-3.05 million, but showed a significant year-over-year improvement of +25% [4] Stock Performance - ADP shares have returned -4.7% over the past month, contrasting with the Zacks S&P 500 composite's +3.8% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]