Summary
Automatic Data Processing, Inc. (ADP) reported solid financial results for the six months ended December 31, 2025, demonstrating consistent growth and operational efficiency. Total revenues increased by 7% year-over-year to $10.53 billion, driven by new business, client retention, strategic pricing, and a notable increase in interest income from client funds, which benefited from higher average client fund balances and increased interest rates. The company also achieved an expansion in its earnings before income taxes (EBIT) margin by 30 basis points, reflecting effective cost management and revenue growth. This growth was underpinned by strategic investments in technology and an expanded sales organization, balanced by disciplined expense control. ADP continued its commitment to shareholder returns, repurchasing approximately $0.9 billion of its stock and paying $1.3 billion in dividends during the period. The acquisition of WorkForce Software in October 2024 is being integrated into the Employer Services segment and is expected to contribute to future growth. The company's financial position remains strong, with ample liquidity from operations and committed credit facilities to support ongoing operations, dividend payments, and potential future investments. Looking ahead, ADP remains focused on its strategic priorities of leading with best-in-class HCM technology and leveraging its global scale to serve clients.
Financial Highlights
53 data points| Revenue | $5.36B |
| Cost of Revenue | $2.89B |
| Gross Profit | $2.47B |
| R&D Expenses | $257.80M |
| SG&A Expenses | $1.07B |
| Operating Expenses | $4.08B |
| Interest Expense | $124.10M |
| Net Income | $1.06B |
| EPS (Basic) | $2.63 |
| EPS (Diluted) | $2.62 |
| Shares Outstanding (Basic) | 403.80M |
| Shares Outstanding (Diluted) | 404.70M |
Key Highlights
- 1Total revenues grew 7% to $10.53 billion for the six months ended December 31, 2025, with organic constant currency growth at 6%.
- 2Earnings Before Income Taxes (EBIT) margin expanded by 30 basis points, reaching 25.5% for the six-month period.
- 3Diluted Earnings Per Share (EPS) increased by 9% to $5.12 for the six months ended December 31, 2025.
- 4Interest on funds held for clients increased due to higher average client fund balances and improved interest rates, contributing to revenue growth.
- 5The company returned $2.1 billion to shareholders through dividends ($1.3 billion) and share repurchases ($0.9 billion) during the six-month period.
- 6The acquisition of WorkForce Software in October 2024 is being integrated into the Employer Services segment.
- 7Operating cash flow for the six months ended December 31, 2025, was $1.78 billion, while investing activities used $2.54 billion, and financing activities provided $29.34 billion.