Skip to content
AnalystLens

AUTOMATIC DATA PROCESSING INC 8-K Report, Financial Results (Jan 28, 2026)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed January 28, 2026
Period End
January 28, 2026
Security
ADP
In the record · 2016–202610-K1110-Q328-K103

ADP filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 103 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Jun ’18Jun ’18
  2. Material agreement8-K · Aug ’20Aug ’20
  3. Leadership change8-K · Nov ’22Nov ’22
  4. Leadership change8-K · Nov ’24Nov ’24

01—Abstract

Summary

Summary of the 8-K filed January 28, 2026. Cited figures are marked; the original filing is the authoritative source.

ADP reported fiscal Q2 2026 (quarter ended December 31, 2025) results that met or beat its expectations across the board.

Revenue rose 6% year over year to $5.36 billiona (5% organic constant currency), and GAAP net earnings increased 10% to $1.06 billion. Diluted EPS grew 11% to $2.62, and adjusted EBIT margin expanded 80 basis points to 26.0%. Employer Services revenue grew 6% with segment margin up 50 basis points, while PEO Services revenue grew 6% but segment margin fell 70 basis points.

U.S. pays per control rose 1%. The most notable item for investors is the raised full-year fiscal 2026 outlook. Management now expects revenue growth of about 6% (previously 5% to 6%), adjusted diluted EPS growth of 9% to 10% (previously 8% to 10%), and client funds interest revenue of $1.310 to $1.330 billionb (previously $1.300 to $1.320 billion).

Adjusted EBIT margin expansion of 50 to 70 basis points and the adjusted effective tax rate of about 23%c were held steady. Employer Services bookings growth of 4% to 7% and client revenue retention decline of 10 to 30 basis points were also reaffirmed. Interest on client funds is a significant earnings driver.

Interest on funds held for clients rose 13% to $309 milliond on a 6% increase in average balances to $37.6 billion and a 20 basis point rise in yield to 3.3%. Balance sheet figures show a sharp jump in funds held for clients and client funds obligations, both now around $67.5 billion, driven by the timing of client funds and the company's extended investment strategy. Net cash from operations for the six months was $1.78 billion, down from $1.97 billion, and the company repaid $4.77 billion of commercial paper while repurchasing $882 million of stock.

02—Key points

Key Highlights

  1. Revenue rose 6% to $5.36 billion (5% organic constant currency), and six-month revenue grew 7% to $10.53 billion.
  2. GAAP net earnings increased 10% to $1.06 billion, and diluted EPS rose 11% to $2.62; adjusted EBIT margin expanded 80 basis points to 26.0%.
  3. Full-year fiscal 2026 revenue growth outlook was raised to about 6%, and adjusted diluted EPS growth to 9% to 10% from 8% to 10%.
  4. Interest on client funds grew 13% to $309 million, with average client funds balances up 6% to $37.6 billion and yield up 20 basis points to 3.3%.
  5. PEO Services segment margin fell 70 basis points to 14.4%, while average worksite employees rose 2% to about 758,000.
  6. Employer Services segment margin improved 50 basis points to 35.4%, and U.S. pays per control grew 1%.
  7. Balance sheet reflects funds held for clients and client funds obligations of about $67.5 billion each, and $4.77 billion of commercial paper was repaid during the period.

03—Questions

Frequently Asked Questions

  1. Did ADP change its fiscal 2026 guidance?

    Yes, partially. Revenue growth guidance was raised to about 6% from 5% to 6%, and adjusted diluted EPS growth was narrowed and raised to 9% to 10% from 8% to 10%. Client funds interest revenue guidance was lifted by $10 million at both ends, to $1.310 to $1.330 billion. Adjusted EBIT margin expansion of 50 to 70 basis points, the roughly 23% tax rate, and Employer Services bookings and retention outlooks were unchanged.

  2. Why did PEO segment margin decline?

    PEO Services segment margin fell 70 basis points to 14.4% in the quarter, even though segment revenue grew 6%. The release does not give a detailed breakdown of the cause. Management did note that PEO revenue excluding zero-margin benefits pass-throughs grew only 3%, which suggests the margin pressure was tied to the mix and cost structure of the business rather than to the headline revenue growth.

  3. How much of ADP's earnings growth comes from client fund interest?

    Client funds interest is a meaningful contributor. Interest on funds held for clients rose $36 million year over year to $309 million in the quarter, and the net impact from the client funds strategy rose 24% to $294 million. Management also expects client funds interest revenue of $1.31 to $1.33 billion for fiscal 2026, so interest rate and balance trends remain an important swing factor for profitability.

  4. Is ADP's underlying demand growing?

    Signals are mixed but mostly positive. Employer Services revenue grew 6%, and Employer Services segment margin rose, indicating operating leverage. U.S. pays per control grew 1%, and the company expects it to be roughly flat for the full year. Management guided to Employer Services new business bookings growth of 4% to 7% and a client revenue retention decline of 10 to 30 basis points, which suggests steady but not accelerating demand.

04—Continue

← View all 8-K filings