ADP earnings analysis
What we found in ADP's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
ADP reported strong Q3 FY2026 results with revenues of $5.94 billion, reflecting a 7% increase year-over-year, and EPS of $3.38, which is a 10% growth compared to the same quarter last year. The company also highlighted improved margins and raised its full-year guidance on adjusted EBIT margin and EPS growth, demonstrating confidence in ongoing business performance.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue Growth of 7% YoY
- Total revenue reached $5.94 billion, up from $5.55 billion in Q3 FY2025.
- EPS Increased 10%
- Diluted EPS rose to $3.38 from $3.06 year-over-year.
- Adjusted EBIT Margin Expansion
- Adjusted EBIT margin improved by 50 basis points to 30.2% for the quarter.
- Interest Income Growth
- Interest earnings from client funds rose to $403.9 million, compared to $355.2 million in the previous year.
- Strong Free Cash Flow
- Free cash flow was reported at $1.49 billion for Q3, contributing to robust liquidity.
- Increased Shareholder Returns
- ADP returned $3.4 billion to shareholders, including $1.9 billion in dividends.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Regulatory Risks Undisclosed
- No new material regulatory risks were indicated compared to previous filings.
- Cybersecurity Threats Persist
- Ongoing threats from cybersecurity issues continue to pose risks.
- Competition Intensity
- Increased competition in HR and payroll service sectors can impact growth.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $3.38
- Operating margin
- 30.2%
- Segment
- Employer Services: $4.036B, 7% growth
- Segment
- PEO Services: $1.906B, 7% growth
What they said about what is next.
Management raised full-year guidance for revenue and adjusted EBIT margin.
The filing reads better than the one before it.
What came before.
- 10-K · August 6, 2025
- ADP emphasizes scale, data advantage, and an AI-first product roadmap, highlighting over 1.1 million clients, ADP Lyric launch (Sept 2024), and rollout of ADP Assist (generative AI). The company reported a Q4 revenue…
- 10-Q · May 2, 2024
- ADP reported quarterly revenue of $5,253.8 million (up $326.0 million versus $4,927.8 million a year ago) and diluted EPS of $2.88 (versus $2.51 prior year). Operating margin remained strong at 29.4% (operating income…
- 10-Q · February 1, 2024
- ADP reported strong Q2 results with total revenue of $4.67B, up 6.3% from $4.39B a year ago, and diluted EPS of $2.13, reflecting an increase of 9.2% from the prior year's $1.95. Gross and operating margins improved to…
- 10-Q · May 1, 2023
- ADP reported Q3 revenue of $4,927.8M (up from $4,513.0M a year ago) and diluted EPS of $2.51 (vs $2.21 prior year), with gross margin expanding to ~46.8% and operating margin to ~27.7%. Growth was broad-based across…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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