ADP (NASDAQ: ADP) reported Q2 EPS of $2.13, $0.03 better than the analyst estimate of $2.10. Revenue for the quarter came in at $4.7 billion versus the consensus estimate of $4.65 billion.

Fiscal 2024 Outlook

• Certain components of ADP’s fiscal 2024 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 2023 pre-tax charges of about $9 million related to transformation initiatives
• •Fiscal 2023 pre-tax charges of about $1 million related to legal settlements
• •Fiscal 2024 expected pre-tax charges of about $5 million related to transformation initiatives

Consolidated Fiscal 2024 Outlook

• •Revenue growth of 6% to 7%
• •Adjusted EBIT margin expansion of 60 to 70 basis points
• •Adjusted effective tax rate of about 23%
• •Diluted EPS growth of 10% to 12%
• •Adjusted diluted EPS growth of 10% to 12%

Employer Services Segment Fiscal 2024 Outlook

• •Employer Services revenue growth of 7% to 8%
• •Employer Services margin up 150 to 160 basis points
• •Employer Services new business bookings growth of 4% to 7%
• •Employer Services client revenue retention decrease of 40 to 60 basis points
• •Increase in U.S. pays per control of 1% to 2%
• PEO Services Segment Fiscal 2024 Outlook
• •PEO Services revenue growth of 3% to 4%
• •PEO Services revenue, excluding zero-margin benefits pass-throughs, growth of 2% to 4%
• •PEO Services margin down 80 to 100 basis points
• •PEO Services average worksite employee count growth of 2% to 3%
• Client Funds Extended Investment Strategy Fiscal 2024 Outlook
• The interest assumptions in our outlook are based on Fed Funds futures contracts and various forward yield curves as of January 30, 2024. 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 4.0%, was used to forecast new purchase rates across the client and corporate extended and client long portfolios over the remainder of the fiscal year.
  

For earnings history and earnings-related data on ADP (ADP) click here.