Paycom forecasts weak fourth-quarter revenue; shares tank

Paycom Software

31/10/2023 21:35

Oct 31 (Reuters) - Payroll processor Paycom Software
 PAYC.N  on Tuesday forecast fourth-quarter revenue that was
below market estimates hit by sluggish demand for payroll
solutions and human resource management amid an uncertain
economy, sending the company's shares down 28% in extended
trading. 
        Sticky inflation and high borrowing costs have clouded
Paycom's outlook and hurt demand for the company's human
resource and payroll services amid a resilient job market. 
    The results are in sharp contrast with rival Automatic Data
Processing  ADP.O  which last week topped profit estimates on
higher demand for its payroll services.   
    Paycom forecast current-quarter revenue in the range of $420
million to $425 million, compared with estimates of $452.3
million, according to LSEG data. 
    The company also cut its annual revenue forecast to a range
of $1.679 billion to $1.684 billion.
    It posted revenue of $406.3 million for the third quarter
ended Sept. 30, missing analyst estimates of $411.2 million. 
        Net income came in at $1.30 per share compared with 90
cents per share a year ago. 

 (Reporting by Zaheer Kachwala in Bengaluru; Editing by Shailesh
Kuber)
 ((Zaheer.Kachwala@thomsonreuters.com;))