ADP raises annual forecast on resilient payroll service demand

Automatic Data Processing

29/04/2026 13:05

April 29 (Reuters) - Payroll firm Automatic Data Processing ADP.O on Wednesday lifted its full-year 2026 forecasts after beating third-quarter estimates, helped by strong spending by enterprise clients on the company's payroll and human resource software.

ADP's scale has helped it attract strong demand for its software despite a slower labor market.

As one of the largest human capital management companies in the world, ADP is benefiting from strong demand for its services, even as the industry undergoes consolidation to grab a larger share of the market.

ADP provides services ranging from administrative support to assistance on employee benefits.

The company reported third-quarter revenue of $5.94 billion, beating analysts' estimate of $5.85 billion, according to data compiled by LSEG.

Adjusted profit per share stood at $3.37, compared with estimates of $3.29.

"ADP has the financial strength and scale to invest with confidence in AI capabilities across our products, service delivery, and sales organization to fuel our future growth, while continuing to deliver on our financial commitments. Our updated fiscal 2026 guidance reflects stronger revenue and earnings growth," CFO Peter Hadley said.

The company now expects annual revenue to grow between 6% and 7%, compared with its earlier growth forecast of 6%.

Full-year adjusted profit per share is now expected to grow between 10% and 11%, compared with a prior estimate of 9%-10% growth.

ADP's U.S. "pay-per-control" metric, which tracks how many employees are on its clients' payrolls, rose 1% in the third quarter from a year earlier.

 (Reporting by Arunesh Sinha; Editing by Shailesh Kuber)

 ((Arunesh.Sinha@thomsonreuters.com;))