Paychex Inc. (NASDAQ:PAYX) announced fiscal fourth‑quarter results that surpassed Wall Street expectations, yet its shares fell roughly 2% in early trading as investors zeroed in on the 2027 outlook.
For the quarter ending May 31, the company posted adjusted diluted earnings per share of $1.32, marginally above the consensus estimate of $1.31.
Revenue climbed 12% year‑over‑year to $1.61 billion, exceeding the $1.60 billion consensus forecast.
For fiscal 2026, revenue grew 17% to $6.51 billion, and adjusted diluted earnings per share increased 11% to $5.51.
Growth in the quarter was partly driven by the April 2025 acquisition of Paycor HCM, which added roughly eight percentage points to Management Solutions revenue growth.
That segment rose 14% to $1.2 billion, while revenue from Professional Employer Organization (PEO) and Insurance Solutions increased 9% to $369.7 million. Interest earned on client‑held funds rose 15% to $52.2 million.
\”…We ended fiscal 2026 with strong momentum, delivering double‑digit revenue and earnings growth and accelerating organic revenue growth throughout the year,\” Paychex CEO John Gibson said in a statement.
He highlighted the integration of Paycor and continued investment in artificial intelligence, including the rollout of the company’s WISE AI‑powered intelligence engine.
For 2027, Paychex projects total revenue growth of 5% to 6% in fiscal 2027, with Management Solutions revenue expected to rise 5% to 6% and PEO and Insurance Solutions revenue increasing 6% to 7%.
The outlook broadly aligns with analyst expectations, but investors appeared cautious about the growth trajectory, prompting a modest decline in the stock.
