Core Insights - Automatic Data Processing, Inc. (ADP) reported strong fourth-quarter fiscal 2025 results, with earnings and revenues exceeding the Zacks Consensus Estimate [1][9] - Earnings per share reached $2.26, surpassing estimates by 1.8% and increasing 8.1% year-over-year, while total revenues were $5.1 billion, exceeding estimates by 1.5% and growing 7.5% year-over-year [1][9] Segment Performance - Employer Services generated revenues of $3.5 billion, an 8% increase on a reported basis but missed the estimate of $3.8 billion; pays per control rose 1% year-over-year [3] - PEO Services revenues increased 9% year-over-year to $1.2 billion, falling short of the $1.7 billion estimate; average worksite employees paid by PEO Services grew 3% to 761,000 [3] Financial Metrics - Interest on funds held for clients grew 11% year-over-year to $308 million, missing the estimate of $342.4 million; average client funds balance rose 6% to $38.1 billion, with an average interest yield of 3.2%, up 20 basis points [4] - Adjusted EBIT increased 9% year-over-year to $5.3 billion, with an adjusted EBIT margin rising 50 basis points to 26% [5] Balance Sheet & Cash Flow - At the end of Q4 fiscal 2025, ADP had cash and cash equivalents of $3.3 billion, up from $2.7 billion in the previous quarter; long-term debt increased to $4 billion from $3 billion [6] - The company generated $1.4 billion in cash from operating activities during the quarter [6] Fiscal 2025 Outlook - ADP lowered its revenue growth guidance for fiscal 2025 to 5-6% from the previous 6-7%; adjusted EPS growth guidance was updated to 8-10% from 8-9% [7] - The adjusted effective tax rate is estimated at 23%, and the guidance for adjusted EBIT margin was raised to 50-70 basis points from 40-50 basis points [7][8]

Core Insights - Automatic Data Processing, Inc. (ADP) reported strong third-quarter fiscal 2025 results, with earnings and revenues exceeding the Zacks Consensus Estimate [1] Financial Performance - Earnings per share were $3.06, beating the consensus estimate by 3.4% and increasing 6.3% year-over-year [1] - Total revenues reached $5.6 billion, surpassing the consensus estimate by 1.1% and growing 5.7% year-over-year [1][2] Segment Performance - Employer Services generated revenues of $3.4 billion, a 5% increase year-over-year, but fell short of the estimate of $3.8 billion [3] - PEO Services revenues rose 7% year-over-year to $1.8 billion, exceeding the projection of $1.7 billion [4] Interest and Client Funds - Interest on funds held for clients grew 11% year-over-year to $355 million, surpassing the estimate of $342.4 million [5] - Average client funds balance increased by 7% to $44.5 billion, with an average interest yield of 3.2%, up 10 basis points [5] Margins - Adjusted EBIT increased 6% year-over-year to $1.6 billion, with an adjusted EBIT margin of 29.3%, up 10 basis points [6] - The margin for Employer Services increased by 20 basis points, while PEO Services remained flat compared to the previous year [6] Balance Sheet and Cash Flow - Cash and cash equivalents at the end of the quarter were $2.7 billion, up from $2.2 billion in the previous quarter [7] - Long-term debt remained stable at $3 billion, with $1.5 billion generated from operating activities during the quarter [7] Fiscal Year 2025 Outlook - ADP expects revenue growth of 6-7% for fiscal 2025, with adjusted EPS growth revised to 8-9% [8] - The adjusted effective tax rate is estimated at 23%, and the guidance for adjusted EBIT margin has been updated to 40-50 basis points [8] - Revenue growth for Employer Services is projected at 6-7%, while the guidance for PEO Services has been raised to 6-7% from the previous 5-6% [8]