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View All NewsADP reports PEO revenue up 12%
PEO revenue rose 12% at ADP (NASD: ADP) in the company’s 2017 fiscal second quarter ended Dec. 31. Roseland, NJ-based ADP provides other services, including paycheck processing. Total revenue rose 6% to $2.99 billion in the quarter; the increase was 7% on a constant-currency basis.
Average worksite employees paid by PEO services increased 12% for the quarter to approximately 452,000.
| (US$ millions) | Q2 2017 | Q2 2016 | % change |
| PEO revenue | $818.1 | $733.3 | 12% |
| Revenue other than interest on funds held for clients or PEO | $2,077.4 | $1,984.4 | 5% |
| Interest on funds held for clients | $91.8 | $89.3 | 3% |
| Total company revenue (including non-PEO) | $2,987.3 | $2,807.0 | 6% |
| Net earnings | $510.9 | $341.4 | 50% |
Quote
“ADP’s results reflect solid performance despite pressure from new business bookings which declined 5% compared to last year’s second quarter,” said CFO Jan Siegmund. “This decline was driven by the continued difficult grow-over related to the tailwinds from our fiscal 2016 sales of additional modules related to the Affordable Care Act, and an elevated level of buyer uncertainty around the November US elections. While below our expectations for the second quarter, we believe this new business bookings pressure will begin to subside as the year progresses.”
Guidance
ADP forecasts its PEO services revenue to rise approximately 13% in its 2017 fiscal year.
Share price and market cap
Shares in ADP fell 5.87% in early afternoon trading today to $95.06 The company had a market cap of $42.91 billion, according to Yahoo.