Paychex's shares jumped 5% on Wednesday after the company's second-quarter revenue and profitability surpassed expectations. The company's sales increased 13% year over year to $1.1 billion in the second quarter, with more revenue coming from each client. The adjusted earnings per share increased by 25% to 91 cents.
The HR solutions provider also raised its yearly guidance for the quarter ending November 30 as a result of the strong growth. Total revenue for the year is now expected to increase by 10% -110%, up from the September prediction of 8% growth. Its first prediction, released in June, predicted sales growth of 7%. The adjusted operating margin is roughly 39.5 %, up a percentage point from the last revision.
In a statement, Chairman and Chief Executive Officer Martin Mucci said, "Results were driven by growth in employees within our client base, as well as continued strong sales growth and client retention."
The demand for HR consultancy services and packages that address talent needs, according to Mucci, has remained robust. "We most recently introduced an automated tool that businesses can leverage to capture and store employee vaccination status and communicate with their employees on an ongoing basis," he said, citing the company's adaptation to the present "complicated" atmosphere as an example.