Paylocity reported a solid start to FY2026 with total revenue of $408.2M (+12% YoY) and recurring & other revenue of $378.9M (+14% YoY). Profitability remained strong, highlighted by adjusted EBITDA of $146.4M (35.9% margin) and GAAP net income of $48M. The company repurchased $200M (≈1.2M shares) in Q1 and raised long-term margin targets for adjusted EBITDA and FCF, signaling confidence in sustained growth.



Q1 2026 Recurring & Other Revenue of $378.9 million, up 14% year-over-year

Q1 2026 Total Revenue of $408.2 million, up 12% year-over-year

Repurchased $200 million or 1.2 million shares in Q1 Fiscal Year 2026; $500 million or 3.0 million shares repurchased since May 2024

Announcing updated long-term financial targets, including increased Adjusted EBITDA and Free Cash Flow margin targets

SCHAUMBURG, Ill., Nov. 04, 2025  Paylocity Holding Corporation (Nasdaq: PCTY), a leading provider of cloud-based HR, Finance, and IT solutions, today announced financial results for the first quarter of fiscal year 2026, which ended September 30, 2025.

“Fiscal 26 is off to a strong start, with recurring & other revenue growth of 14% in the first quarter, combined with a significant increase in profitability, as our differentiated value proposition of providing the most modern software in the industry continues to resonate in the marketplace. Additionally, our AI strategy has continued to progress - delivering predictive and actionable insights, generative AI functionality and a growing number of autonomous agents across the platform to drive productivity through task and workflow automation that goes beyond the basic search capabilities that are considered table stakes in today’s evolving AI landscape. We are also very pleased with the early positive response to our Paylocity for Finance solution, as the value proposition of managing all spend and key business workflows is resonating with both clients and prospects,” said Toby Williams, President and Chief Executive Officer of Paylocity.

First Quarter Fiscal 2026 Financial Highlights

Revenue:

• Total revenue was $408.2 million, an increase of 12% from the first quarter of fiscal year 2025.


• Recurring & other revenue was $378.9 million, an increase of 14% from the first quarter of fiscal year 2025.

Operating Income:

• GAAP operating income was $74.2 million and non-GAAP operating income was $121.2 million in the first quarter of fiscal year 2026 compared to GAAP operating income of $64.1 million and non-GAAP operating income of $104.9 million in the first quarter of fiscal year 2025.

Net Income:

• GAAP net income was $48.0 million or $0.86 per share in the first quarter of fiscal year 2026 based on 55.9 million diluted weighted average common shares outstanding compared to $49.6 million or $0.88 per share in the first quarter of fiscal year 2025 based on 56.3 million diluted weighted average common shares outstanding.

Adjusted EBITDA:

• Adjusted EBITDA, a non-GAAP measure, was $146.4 million in the first quarter of fiscal year 2026 compared to $129.0 million in the first quarter of fiscal year 2025.


• Adjusted EBITDA excluding interest income on funds held for clients, a non-GAAP measure, was $117.1 million in the first quarter of fiscal year 2026 as compared to $99.2 million in the first quarter of fiscal year 2025.

Balance Sheet and Cash Flow:

• Cash and cash equivalents totaled $165.2 million as of September 30, 2025.


• Long-term debt totaled $81.3 million as of September 30, 2025, representing borrowings under our credit facility to fund the acquisition of Airbase on October 1, 2024. This reflects approximately $81.3 million repaid on our outstanding balance during the first quarter of fiscal year 2026.


• Net cash provided by operations for the first three months of fiscal year 2026 was $86.5 million compared to $91.5 million for the first three months of fiscal year 2025.

A reconciliation of GAAP to non-GAAP financial measures has been provided in this press release in the accompanying tables. Additional information regarding these measures can be found below under the headings “Non-GAAP Financial Measures” and “Definitions of our Non-GAAP Measures.”

Long-Term Financial Targets

Updated financial targets given sustained revenue growth, increasing profitability and scale:

⁽¹⁾ Financial targets based on percentage of total revenue.
⁽²⁾ We are unable to reconcile forward-looking non-GAAP long-term financial targets to their directly comparable GAAP financial measures because the information which is needed to complete the reconciliations is unavailable at this time without unreasonable effort.

Business Outlook

Based on information available as of November 4, 2025, Paylocity is issuing guidance for the second quarter and full fiscal year 2026 as indicated below.

Second Quarter 2026:

• Recurring and other revenue is expected to be in the range of $378.5 million to $383.5 million, which represents approximately 10% growth over fiscal year 2025 second quarter recurring and other revenue.


• Total revenue is expected to be in the range of $405.5 million to $410.5 million, which represents approximately 8% growth over fiscal year 2025 second quarter total revenue.


• Adjusted EBITDA, a non-GAAP measure, is expected to be in the range of $131.5 million to $135.5 million.


• Adjusted EBITDA excluding interest income on funds held for clients, a non-GAAP measure, is expected to be in the range of $104.5 million to $108.5 million.

Fiscal Year 2026:

• Recurring and other revenue is expected to be in the range of $1.605 billion to $1.620 billion, which represents approximately 10% growth over fiscal year 2025 recurring and other revenue.


• Total revenue is expected to be in the range of $1.715 billion to $1.730 billion, which represents approximately 8% growth over fiscal year 2025 total revenue.


• Adjusted EBITDA, a non-GAAP measure, is expected to be in the range of $615.0 million to $625.0 million.


• Adjusted EBITDA excluding interest income on funds held for clients, a non-GAAP measure, is expected to be in the range of $505.0 million to $515.0 million.

We are unable to reconcile the forward-looking non-GAAP measures set forth above to their directly comparable GAAP financial measures because the information which is needed to complete a reconciliation is unavailable at this time without unreasonable effort.

Conference Call Details

Paylocity will host a conference call to discuss its first quarter fiscal year 2026 results at 4:00 p.m. Central Time today (5:00 p.m. Eastern Time). A live audio webcast of the conference call along with detailed financial information can be accessed through https://investors.paylocity.com/events-and-presentations where dial in details are provided. A replay of the call will be available and archived via webcast at https://investors.paylocity.com/.

About Paylocity

Headquartered in Schaumburg, IL, Paylocity is an award-winning provider of HR, finance, and IT software solutions through ONE unified platform. Founded in 1997 and publicly traded since 2014, Paylocity offers an intuitive, easy-to-use product suite that helps businesses automate and streamline HR and payroll processes, attract and retain talent, and build culture and connection with their employees. Known for its unique culture and consistently recognized as one of the best places to work, Paylocity accompanies its clients on the journey to create great workplaces and help all employees achieve their best. For more information, visit www.paylocity.com.

Non-GAAP Financial Measures

The company uses certain non-GAAP financial measures when reporting and discussing its financial results, including the financial measures in this release that are designated as being “non-GAAP.” Management presents certain non-GAAP financial measures in this release because it considers them to be important supplemental measures of performance, as they provide investors with the company’s view of its financial performance. Management uses non-GAAP financial measures for planning purposes, including analysis of the company's performance against prior periods, the preparation of operating budgets and to determine appropriate levels of operating and capital investments. Management believes that these non-GAAP financial measures provide additional insight for analysts and investors in evaluating the company's financial and operational performance, including comparisons of current results to prior periods’ results by excluding items the company does not believe reflect fundamental business performance and are not representative or indicative of its results of operations. Non-GAAP financial measures have limitations as an analytical tool and other companies may define their non-GAAP financial measures differently than we do. Investors are encouraged to review the reconciliation of the non-GAAP measures to their most directly comparable GAAP measures provided in the accompanying tables to this release, as well as the definitions of those non-GAAP measures following such tables.

Safe Harbor/Forward Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included herein regarding Paylocity’s future operations, future financial position and performance, anticipated results of operations, prospects, plans and objectives of management are forward-looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “will,” “would,” “seek” and similar expressions (or the negative of these terms) are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include statements about management's estimates regarding future revenues and financial performance, and other statements about management’s beliefs, intentions or goals and are expressed in good faith and believed to be reasonable at the time such statements are made. Paylocity may not actually achieve the expectations disclosed in the forward-looking statements, and you should not place undue reliance on such statements. These forward-looking statements involve risks and uncertainties, many of which are beyond Paylocity’s control, that could cause actual results or events to differ materially from the expectations disclosed in the forward-looking statements. Factors that could cause actual results or events to differ materially from what is presented include, but are not limited to, the general economic conditions in regions in which Paylocity does business, changes in interest rates, business disruptions, reductions in employment and increases in business failures that have occurred or may occur in the future; Paylocity’s ability to leverage AI Assist and other forms of artificial intelligence and machine learning in its technology, which may be constrained by current and future laws, regulations, interpretive positions or standards governing new and evolving technologies and ethical considerations that could restrict or impose burdensome and costly requirements on its ability to continue to leverage data in innovative ways; Paylocity’s ability to retain existing clients and to attract new clients to enter into subscriptions for its services; the challenges associated with a growing company’s ability to effectively service clients in a dynamic and competitive market; challenges associated with expanding and evolving a sales organization to effectively address new geographies and products and services; challenges related to cybersecurity threats and evolving cybersecurity regulations; Paylocity’s reliance on and ability to expand its referral network of third parties; Paylocity’s reliance on third party payroll partners in foreign jurisdictions in its Blue Marble business; difficulties associated with accurately forecasting revenue and appropriately planning expenses; challenges with managing growth effectively; risks related to acquisitions and investments in other businesses and technologies; risks related to regulatory, legislative and judicial uncertainty in Paylocity’s markets; Paylocity’s ability to protect and defend its intellectual property and its use of open source software in its products; the risk that Paylocity’s security measures are compromised or a threat actor gains unauthorized access to customer data; unexpected events in the market for Paylocity’s solutions; changes in the competitive environment in Paylocity’s industry and the markets in which it operates; adverse changes in general economic or market conditions; changes in the employment rates of Paylocity’s clients and the resultant impact on revenue; the possibility that Paylocity may be adversely affected by other economic, business, and/or competitive factors; and other risks and potential factors that could affect Paylocity’s business and financial results that are identified in Paylocity’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on August 6, 2025, as well as any revisions or supplements to the information in subsequent reports filed or furnished to the SEC. These forward-looking statements represent Paylocity’s expectations as of the date of this press release. Subsequent events may cause these expectations to change, and unless legally required, Paylocity disclaims any obligations to update or alter these forward-looking statements in the future, whether as a result of new information, future events or otherwise.