Automatic Data Processing Inc

Latest Results (04.06.2026):

Automatic Data Processing, Inc. (ADP) reported strong third quarter fiscal 2026 results: consolidated revenues of $5.9 billion (up 7%, 6% organic constant currency), net earnings of $1.36 billion (up 9%), and diluted EPS of $3.38 (up 10%). Adjusted EBIT rose 10% to $1.79 billion with an adjusted EBIT margin of 30.2% (up 80 basis points), and the company raised its full-year fiscal 2026 guidance for revenue, adjusted EBIT margin, and adjusted diluted EPS growth.

Revenue and top-line

Revenues for ADP in the third quarter of fiscal 2026 were $5.939 billion, a 7% increase year-over-year and 6% on an organic constant currency basis; Employer Services contributed the majority of growth (Employer Services revenues $4.036B, +7%).

Profitability and EPS

Net earnings were $1.360 billion (up 9%) and diluted EPS was $3.38 (up 10%). Adjusted net earnings and adjusted diluted EPS were essentially unchanged from GAAP adjustments ($1.4B and $3.37 respectively). The company’s adjusted effective tax rate for the quarter was 23.7%.

Operating margin (Adjusted EBIT)

Adjusted EBIT increased 10% to $1.79 billion and the adjusted EBIT margin improved 80 basis points to 30.2%, reflecting margin expansion across Employer Services and disciplined cost execution.

Segment performance

Employer Services: revenues +7% (5% organic), U.S. pays per control +1%, segment margin +130 bps. PEO Services: revenues +7% (5% excluding zero‑margin benefits pass‑throughs), average paid worksite employees +2% to ~762,000, but PEO segment margin declined ~120 bps.

Client funds and interest income

Interest on funds held for clients rose 14% to $404 million; average client funds balances increased 9% to $48.3 billion and the average yield on client funds was ~3.3% (up 10 bps), supporting higher interest-related revenue.

Outlook and guidance

ADP raised its fiscal 2026 outlook: revenue growth 6–7%, adjusted EBIT margin expansion of 70–80 bps, adjusted effective tax rate ~23%, and diluted/adjusted diluted EPS growth of 10–11% for the full year.

Balance sheet & cash flow notes

Funds held for clients increased materially (ending balance $46.4B), total assets $64.5B, and operating cash flow for the nine months was strong ($4.01B), while ADP continued share repurchases and paid dividends during the period.