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Aug 31, 2025
Paychex Q1 2026 Earnings Report
Paychex delivered strong revenue growth in Q1 FY26, driven by the Paycor acquisition, but GAAP earnings declined due to integration costs.
Key Takeaways
Paychex reported a 17% increase in revenue, supported by Paycor integration. Adjusted earnings improved, while GAAP EPS and net income declined primarily due to acquisition-related costs.
Revenue rose 17% YoY to $1.54B, driven by Paycor acquisition.
Net income declined 10% YoY to $383.8M due to acquisition-related expenses.
Adjusted EPS grew 5% to $1.22, while GAAP EPS fell to $1.06.
Cash flow from operations reached $718.4M in the quarter.
Revenue by Segment
Forward Guidance
Paychex raised its full-year adjusted EPS growth outlook to 9–11%, reflecting confidence in integration progress and sustained demand.
Positive Outlook
- Raised FY26 adjusted EPS growth guidance to 9–11%
- Paycor integration progressing successfully
- Sustained demand for HCM solutions
- Continued investment in AI and digital platforms
- Strong cash flow supports dividends and buybacks
Challenges Ahead
- GAAP EPS and net income declined YoY
- Operating margin declined due to integration costs
- Higher selling and administrative expenses (+49%)
- Significant increase in interest expense from debt
- PEO & Insurance segment saw modest 3% revenue growth
Historical Earnings Impact
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Avg. Return Before/After Earnings
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