ADP Lifts Fiscal 2027 Profit Outlook as AI Efficiencies Feed Through

what happened

Payroll provider ADP reported higher net income for its fiscal first quarter ended September 30 and raised its projection for adjusted earnings-per-share growth in fiscal 2027, according to Dow Jones Newswires. The company credits artificial intelligence efficiencies for the improvement.

Net income rose to $1.13 billion, or $2.83 a share, from $1.01 billion, or $2.49 a share, a year earlier. Adjusted earnings came in at $2.82 a share, above the mean analyst estimate of $2.77 a share per FactSet. Revenue climbed 6% to $5.49 billion, slightly ahead of the $5.48 billion average estimate.

For the fiscal year, ADP now expects adjusted EPS growth of 10% to 12%, up from a previous 9% to 11% range. Its revenue growth forecast was narrowed to about 6%.

why it matters

A profit beat and a higher full-year outlook point to steady demand for ADP's services, a signal the payroll and business-services sector in the US will watch closely.

market impact

ADP shares and payroll services sector: results above forecasts and a raised outlook support the stock

• ▲ADP shares pressure up — quarterly results beat estimates and full-year EPS guidance was raised

tags

instruments