ADP Clocks 9% Revenue Growth In Q2 Backed By New Bookings, Client Retention

Automatic Data Processing, Inc ADP reported second-quarter FY23 revenue growth of 9% year-on-year to $4.39 billion, beating the consensus of $4.38 billion.
Employer services revenue rose 8% Y/Y to $2.89 billion, and PEO services revenue grew 11% Y/Y to $1.50 billion.
Non-GAAP EPS of $1.96 beat the consensus of $1.93.
Adjusted EBIT margin expanded by 120 bps to 24.3%. ADP held $1.35 billion in cash and equivalents.
"With strong results in new business bookings, client revenue retention, and U.S. pays per control growth as well as a continued healthy HCM demand backdrop, we are well-positioned to continue our growth across the balance of the year," CFO Don McGuire said.
2023 Outlook: ADP reiterated revenue of $17.82 billion - $17.98 billion (8% - 9% growth) versus the consensus of $17.94 billion.
It reiterated the non-GAAP EPS forecast to $8.06 - $8.20 versus the consensus of $8.12.
Price Action: ADP shares traded lower by 1.77% at $234.92 in the premarket on the last check Wednesday.

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