In Q3 of fiscal 2025, ADP reported robust financial performance with a 6% year-over-year revenue increase, reaching $5.6 billion, driven by solid results across both Employer Services and PEO segments. Adjusted EBIT rose 6% to $1.6 billion with a margin of 29.3%, while adjusted diluted EPS also increased 6% to $3.06. ADP continues to show strong business momentum through record-high client satisfaction, new business bookings growth, and the expansion of its global payroll capabilities, notably with the acquisition of PEI in Mexico. The company has raised its full-year outlook for adjusted earnings and margin growth, reflecting confidence in sustained performance.



• Revenues increased 6% compared to last year's third quarter to $5.6 billion; 6% organic constant currency
• Net earnings increased 5% to $1.2 billion, and adjusted net earnings increased 5% to $1.2 billion
• Adjusted EBIT increased 6% to $1.6 billion, and adjusted EBIT margin increased 10 basis points to 29.3%
• Diluted earnings per share ("EPS") increased 6% to $3.06; adjusted diluted EPS increased 6% to $3.06
• Raising full year guidance for adjusted EBIT margin and adjusted diluted EPS growth

ROSELAND, N.J. – April 30, 2025 – ADP (Nasdaq: ADP), a leading global technology company providing human capital management (HCM) solutions, today announced its third quarter fiscal 2025 financial results and updated its  fiscal 2025 outlook.

Third Quarter Fiscal 2025 Consolidated Results

Compared to last year’s third quarter, revenues increased 6% to $5.6 billion and 6% on an organic constant  currency basis. Net earnings increased 5% to $1.2 billion, and adjusted net earnings increased 5% to $1.2 billion.  Adjusted EBIT increased 6% to $1.6 billion, representing an adjusted EBIT margin increase of 10 basis points in the quarter to 29.3%. ADP’s effective tax rate for the quarter was 23.0% on both a reported basis and an adjusted basis. Diluted EPS increased 6% to $3.06, and adjusted diluted EPS increased 6% to $3.06.

“Our solid third quarter results reflect the strength and consistency of our business and the dedication of our associates who helped drive new record highs in client satisfaction this fiscal year," said Maria Black, President and Chief Executive Officer of ADP. “As the world of work evolves, we will maintain our strategic progress and continue to lead the way through our resilient and broad-based business portfolio, market-leading product offerings, and the differentiated service we provide our clients each day."

"With good outcomes in revenue and earnings growth in the third quarter, we are positioned for strong overall fiscal 2025 results," said Don McGuire, Chief Financial Officer, ADP. "We remain focused on delivering against our revenue and profitability commitments as we continue to invest in our business to drive sustainable, long-term growth."

Adjusted EBIT, adjusted EBIT margin, adjusted net earnings, adjusted diluted earnings per share, adjusted effective tax rate and organic constant currency are all non-GAAP financial measures. Please refer to the accompanying financial tables at the end of this release for a discussion of why ADP believes these measures are important and for a reconciliation of non-GAAP financial measures to their closest comparable GAAP financial measures.



Third Quarter Segment Results

Employer Services – Employer Services offers a comprehensive range of global HCM and Human Resources Outsourcing solutions. Compared to last year's third quarter:

• Employer Services revenues increased 5% on a reported basis and 5% on an organic constant currency basis
• U.S. pays per control increased 1%
• Employer Services segment margin increased 20 basis points

PEO Services – PEO Services provides comprehensive employment administration outsourcing solutions.
Compared to last year's third quarter:

• PEO Services revenues increased 7%
• PEO Services revenues excluding zero-margin benefits pass-throughs increased 8%
• Average worksite employees paid by PEO Services increased 2% to about 748,000
• PEO Services segment margin was flat

Included within the results of our segments above:

Interest on Funds Held for Clients – The safety, liquidity, and diversification of ADP clients’ funds are the foremost objectives of the Company’s investment strategy. Client funds are invested in accordance with ADP’s prudent and conservative investment guidelines, and most of the investment portfolio is rated AAA/AA. Compared to last year's third quarter:

• Interest on funds held for clients increased 11% to $355 million
• Average client funds balances increased 7% to $44.5 billion
• The average interest yield on client funds increased 10 basis points to 3.2%

Fiscal 2025 Outlook


Certain components of ADP’s fiscal 2025 outlook and related growth comparisons exclude the impact of the following items and are discussed on an adjusted basis where applicable. Please refer to the accompanying financial tables for a reconciliation of these adjusted amounts to their closest comparable GAAP measure.
• Fiscal 2024 pre-tax charges of about $5 million related to transformation initiatives
• Fiscal 2024 pre-tax reversal of about $4 million related to a legal matter
• Fiscal 2024 pre-tax charges of about $42 million related to workforce optimization

Consolidated Fiscal 2025 Outlook
• Revenue growth of 6% to 7%
• Adjusted EBIT margin expansion of 40 to 50 basis points
• Adjusted effective tax rate of about 23%
• Diluted EPS growth of 9% to 10%
• Adjusted diluted EPS growth of 8% to 9%
Employer Services Segment Fiscal 2025 Outlook
• Employer Services revenue growth of 6% to 7%
• Employer Services margin up 50 to 60 basis points
• Employer Services new business bookings growth of 4% to 7%
• Employer Services client revenue retention decrease of 20 basis points to flat
• Increase in U.S. pays per control of about 1%
PEO Services Segment Fiscal 2025 Outlook
• PEO Services revenue growth of 6% to 7%
• PEO Services revenue, excluding zero-margin benefits pass-throughs, growth of 5% to 6%
• PEO Services margin down 60 to 80 basis points
• PEO Services average worksite employee count growth of 2% to 3%

Client Funds Extended Investment Strategy Fiscal 2025 Outlook

The interest assumptions in our outlook are based on Fed Funds futures contracts and various forward yield curves as of April 29, 2025. The Fed Funds futures contracts are used in the client short and corporate cash interest income outlook. A combination of various forward yield curves that reflect our investment mix, resulting in a blended rate of 4.1%, was used to forecast new purchase rates across the client and corporate extended and client long portfolios over the remainder of the fiscal year.

About ADP (Nasdaq: ADP)
Designing better ways to work through cutting-edge products, premium services, and exceptional experiences that enable people to reach their full potential. HR, Talent, Time Management, Benefits, and Payroll. Informed by data and designed for people. Learn more at ADP.com.