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Aug 31, 2021
Paychex Q1 2022 Earnings Report
Paychex's first quarter results were announced, revealing a 16% increase in revenue and a 56% growth in diluted earnings per share.
Key Takeaways
Paychex reported a strong start to fiscal year 2022, achieving double-digit growth in both revenue and earnings, driven by economic improvement, sales momentum, and strong client retention.
Total revenue increased by 16% compared to the prior-year period.
Diluted earnings per share grew by 56% compared to the prior-year period.
Management Solutions revenue increased by 17%, driven by client base growth and increased solution penetration.
PEO and Insurance Solutions revenue increased by 14%, driven by worksite employee growth and higher average wages.
Paychex
Paychex
Paychex Revenue by Segment
Forward Guidance
Paychex updated its outlook for fiscal year 2022, anticipating continued growth and margin expansion.
Positive Outlook
- Management Solutions revenue is now anticipated to grow approximately 8%.
- Total revenue is also anticipated to grow approximately 8%.
- Adjusted operating margin is anticipated to increase to a range of 38% to 39%.
- Adjusted EBITDA margin is anticipated to increase to approximately 43%.
- Adjusted diluted earnings per share is now anticipated to grow in the range of 12% to 14%.
Challenges Ahead
- Changes in the macroeconomic environment could alter guidance.
- Other expense, net is now anticipated to be in the range of $23 million to $26 million.
Revenue & Expenses
Visualization of income flow from segment revenue to net income