Revenue rose 7% at Paychex Inc. (NASD: PAYX) in the Rochester, NY-based company’s fiscal second quarter ended Nov. 30. However, revenue rose 15% in the firm’s Human Resource Services segment, which includes the company’s professional employer organization business. Revenue growth in the segment was driven by increases in the company’s client base.

Looking to the company’s Payroll Services segment, second-quarter revenue rose 1%.

Paychex reported its acquisition of PEO provider HR Outsourcing Holdings Inc. contributed 3% to growth of total revenue.

Quote

“As the integration of [HR Outsourcing Holdings] into our existing professional employer organization business continues, we are experiencing favorable results, further strengthening and expanding our presence in the PEO market and positioning us for stronger long-term growth,” President and CEO Martin Mucci said in a statement.

Guidance

Paychex forecast Human Resource Services revenue to be up 12% to 14% in this fiscal year compared to last, and total revenue is expected to grow 6%. The guidance is unchanged from the previous quarter. However, Paychex noted the forecast does not take into account any impact from the newly passed tax reform legislation.

“We anticipate that the impact of tax reform legislation will be a benefit of 10% to 12% on our annualized effective income tax rate,” according to the company. “This is based upon our current understanding of the legislation and may be subject to change upon further review of the final law and interpretive guidance that may be issued. We expect a portion of these benefits to be reinvested in the business to drive future growth.”

Share price and market cap

Shares in Paychex were down 2.50% to $67.47 as of 1:08 p.m. Eastern time. The company had a market cap of $24.22 billion.