Paychex, Inc.

Strong Q3 performance with accelerating organic growth (amid tough comps): Revenue grew 20% YoY to ~$1.8B; adjusted operating income +22% YoY with adjusted op margin ~47.7% (+~80 bps). Management attributed strength to effective execution and strategic progress—especially Paycor integration and accelerating AI initiatives. Organic growth was described as weaker earlier in the year due to comparability issues (notably PEO/Mid-risk MPP enrollment timing in Florida), but the back half has improved: ~6% organic growth in Q3/Q4 combined and ~5% full-year estimate (based on management’s framing of sequential improvement).

Q4 forecast: ~12% growth with margin range; outlook reaffirms FY26 (except interest on funds): For Q4 FY26, company expects ~12% revenue growth and adjusted operating margin ~41%–42%. Drivers cited: Paycor anniversary, and some timing puts/takes between Q3 vs Q4 (particularly in PEO). For full-year FY26, management reaffirmed prior guidance with one change: interest on funds held for clients raised to $200M–$210M (up from prior range). Management emphasized they believe the organic growth trajectory in the back half aligns with consensus for next year.

Paycor integration momentum and synergy confidence: Paycor contributed roughly ~19 percentage points to Q3 growth. Management said bookings and broker referrals reaccelerated to pre-acquisition levels, and they are adding sales headcount to capture demand. They reiterated expectation to exceed FY26 synergy targets discussed last quarter, and highlighted cross-selling momentum (Paychex ASO/PEO/Retirement to Paycor clients) and “larger-than-expected” ASO and broker-referred PEO wins.