AUTOMATIC DATA PROCESSING INCADP
AUTOMATIC DATA PROCESSING INC Financial Overview 2021–2025
Updated Jul 10, 2026Automatic Data Processing (ADP) marked its 50th consecutive annual dividend increase in FY2025 while returning a massive $3.7 billion to shareholders, underscoring the sheer cash-generating power of its recurring-revenue model. The payroll giant operates as a relentless compounding machine, leveraging sticky enterprise relationships and high interest rates on client funds to drive highly profitable, predictable growth. This fundamental stability is evident across a multi-year expansion, as total revenue grew from $15.0 billion in FY2021 to $20.56 billion in FY2025.
That top-line momentum is protected by a formidable 92.1% client retention rate in its Employer Services segment during FY2025. ADP is actively reinvesting this cash flow to widen its moat, highlighted by the $1.2 billion acquisition of WorkForce Software in October 2024 and aggressive rollouts of generative AI platforms like ADP Lyric. These strategic moves, combined with careful cost discipline, drove a 50-basis-point expansion in EBIT margins in FY2025. Investors have heavily rewarded this combination of operational efficiency and steady capital return. At the close of FY2025, the market valued the company at a $125.0 billion market cap, with the stock priced at $308.40 and trading at a premium 30.9x P/E ratio.
Recent Developments (Q2 and Q3 2026)
ADP maintained steady top-line momentum through Q3 2026, generating $16.5 billion in revenue over the nine months ended March 31, 2026. This represents a 7% year-over-year increase, supported by a 7.3% rise in average client fund balances. Operational efficiencies drove a further 50-basis-point EBIT margin expansion during the period, lifting net earnings 8% to $3.4 billion and diluted EPS 10% to $8.49. Management fortified corporate liquidity by issuing $1 billion in 5.000% senior notes due 2036 in May 2026 and securing $9.2 billion in new credit facilities in June 2026.
Bulls emphasize the company's ability to compound earnings through higher interest yields despite a tepid hiring environment. Bears warn that slow underlying volume growth, highlighted by a mere 1% increase in Employer Services pays per control, limits core operational upside. The stock trades at an accessible 21.2x earnings as of April 30, 2026.
What to watch: capital deployment leveraging the new $9.2 billion credit facilities; fluctuations in client fund interest revenue.
Rev
$20.56B
FY2025
NI
$4.08B
FY2025
EPS
$10.02
FY2025
OCF
$4.94B
FY2025
Year-over-year comparison from 10-K annual reports
Data from SEC Company Facts
Recent SEC Filings
AUTOMATIC DATA PROCESSING INC 8-K Report, Material Agreement (Jun 26, 2026)
Automatic Data Processing, Inc. (ADP) has entered into new credit agreements totaling $9.2 billion, replacing its previous facilities. The company secured a $5.7 billion 364-day credit facility and a $3.5 billion five-year credit facility. The five-year facility includes an accordion feature allowing for an additional $500 million in commitments, potentially increasing its total capacity to $4 billion. These new facilities provide ADP with significant liquidity and flexibility for general corporate purposes, replacing existing credit lines that expired on June 26, 2026. The structure of these new facilities offers revolving credit options denominated in multiple currencies (USD, CAD, EUR for the five-year facility) and interest rates tied to SOFR or prime rate benchmarks. The company will pay commitment fees on unused portions and a term-out fee on the 364-day facility. Standard covenants and events of default are included, consistent with industry practices. This strategic move enhances ADP's financial footing and operational capacity.
AUTOMATIC DATA PROCESSING INC 8-K Report, Material Agreement (May 7, 2026)
Automatic Data Processing, Inc. (ADP) announced the successful issuance and sale of $1,000,000,000 aggregate principal amount of its 5.000% senior notes due 2036. This offering, executed on May 4, 2026, and closed on May 7, 2026, was conducted under an Underwriting Agreement with prominent financial institutions including BNP Paribas Securities Corp., BofA Securities, Inc., and J.P. Morgan Securities LLC. The notes were registered with the SEC and offered through a prospectus supplement, indicating a well-established and registered debt issuance process. This debt issuance provides ADP with significant capital, which could be used for various corporate purposes such as funding general corporate operations, potential acquisitions, or refinancing existing debt. The fixed interest rate of 5.000% on these senior notes offers predictability for future interest expenses. Investors in these notes are acquiring a debt instrument from a well-established company, with the terms and legality of the issuance further supported by counsel opinions filed with the SEC.
AUTOMATIC DATA PROCESSING INC 8-K Report, Financial Results (Apr 29, 2026)
Automatic Data Processing, Inc. (ADP) filed a Form 8-K on April 29, 2026, to announce its financial results for the third quarter ended March 31, 2026. The report primarily serves to furnish investors with the earnings release, which contains detailed financial performance information. Investors should refer to the attached earnings release (Exhibit 99) for specific metrics on revenue, profitability, and other key performance indicators for the quarter. This filing does not contain new operational updates or significant strategic announcements beyond the quarterly financial performance. The incorporated earnings release is the definitive source for understanding ADP's financial condition and results of operations for the period. As is typical with 8-K filings under Item 2.02, the company is providing access to its earnings announcement through this regulatory filing. The accompanying exhibit is the full earnings release, which includes the company's financial statements and management's discussion and analysis. Investors are encouraged to review this document thoroughly to gain a comprehensive understanding of ADP's performance and outlook.
AUTOMATIC DATA PROCESSING INC 8-K Report, Financial Results (Jan 28, 2026)
Automatic Data Processing, Inc. (ADP) has filed a Form 8-K on January 27, 2026, to announce its financial results for the second quarter ended December 31, 2025. The company has made its earnings release, dated January 28, 2026, available on its website and has attached it as an exhibit to this filing. Investors should refer to the earnings release for detailed financial performance, operational highlights, and forward-looking statements for the second quarter of fiscal year 2026. This filing serves as the primary disclosure vehicle for these results, supplementing information typically found in quarterly reports.
AUTOMATIC DATA PROCESSING INC 8-K Report, Shareholder Vote Results (Nov 17, 2025)
Automatic Data Processing, Inc. (ADP) filed an 8-K on November 17, 2025, reporting the results of its Annual Meeting of Stockholders held on November 12, 2025. The meeting saw significant shareholder participation, with over 354 million shares represented. Key outcomes include the election of all director nominees by substantial margins and the approval, on an advisory basis, of the company's executive compensation. Additionally, shareholders ratified the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year beginning July 1, 2025. Investors can take comfort in the strong shareholder support for both the board of directors and executive compensation policies, indicating alignment between management and ownership. The ratification of the auditor also suggests confidence in the company's financial oversight and reporting processes. While broker non-votes were present for director elections, the overwhelming 'For' votes for most nominees demonstrate broad shareholder approval.
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