Payroll services provider ADP's Q1 profit beats on new business bookings

Automatic Data Processing

29/10/2025 11:05

Overview

ADP fiscal Q1 revenue grows 7% to $5.2 bln, beating analyst expectations

Adjusted EPS for fiscal Q1 rises 7% to $2.49, exceeding analyst estimates

Adjusted EBIT for fiscal Q1 increases 7% to $1.3 bln, surpassing estimates

Outlook

ADP maintains fiscal 2026 revenue growth guidance of 5% to 6%

Company expects adjusted diluted EPS growth of 8% to 10% for fiscal 2026

ADP anticipates PEO Services revenue growth of 5% to 7% in fiscal 2026

Result Drivers

NEW BUSINESS BOOKINGS - ADP attributes revenue growth to strong new business bookings and high client revenue retention

AI INTEGRATION - ADP continues to infuse AI into products and operations to enhance client solutions and efficiency

INTEREST REVENUE - Increased interest on funds held for clients contributed to revenue growth

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q1 Revenue
Beat
$5.18 bln
$5.13 bln (12 Analysts)
Q1 Adjusted EPS
Beat
$2.49
$2.43 (14 Analysts)
Q1 EPS
$2.49
Q1 Net Income
$1 bln
Q1 Adjusted EBIT
Beat
$1.30 bln
$1.29 bln (8 Analysts)
Q1 Adjusted EBIT Margin
25.50%


Analyst Coverage

The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 12 "hold" and 2 "sell" or "strong sell"

The average consensus recommendation for the it services & consulting peer group is "buy."

Wall Street's median 12-month price target for Automatic Data Processing Inc is $313.00, about 10.7% above its October 28 closing price of $279.63

The stock recently traded at 25 times the next 12-month earnings vs. a P/E of 28 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact RefinitivNewsSupport@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)