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Dec 31, 2020
ADP Q2 2021 Earnings Report
Reported a 1% increase in revenues to $3.7 billion and a diluted EPS increase of 1% to $1.51.
Key Takeaways
ADP reported a slight increase in revenue and diluted EPS for the second quarter of fiscal year 2021. Revenues increased by 1% to $3.7 billion, while diluted EPS increased by 1% to $1.51. The company raised its full-year guidance due to strong first-half performance and an improved outlook for the remainder of the fiscal year.
Revenues increased 1% to $3.7 billion; raising full year guidance to up 1% to 3%.
Employer Services New Business Bookings decreased 7%; raising full year guidance to up 15% to 25%.
Net earnings decreased 1% to $648 million, and adjusted net earnings decreased 1% to $650 million.
Diluted earnings per share ("EPS") increased by 1% to $1.51 for the quarter; adjusted diluted EPS flat at $1.52.
Revenue by Segment
Forward Guidance
ADP has raised its fiscal year 2021 outlook, anticipating revenue growth of 1% to 3% and adjusted diluted EPS growth of (2)% to 2%.
Positive Outlook
- Revenue growth of 1% to 3%.
- Employer Services New Business Bookings growth of 15% to 25%.
- Employer Services client revenue retention increase of approximately 100 basis points.
- PEO Services revenue growth of 3% to 5%.
- PEO Services revenue, excluding zero-margin benefits, growth of 3% to 5%.
Challenges Ahead
- Adjusted EBIT margin decline of (100) to (50) basis points.
- Adjusted effective tax rate of 23.0%.
- Diluted EPS growth of 1% to 5%.
- Adjusted diluted EPS growth of (2)% to 2%.
- Decrease in U.S. pays per control of (4)% to (3)%.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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