Paycom Software Inc

Paycom Software delivered a mixed set of results in its most recent result, with revenues falling short of Wall Street expectations but above-par earnings. Despite a revenue slightly below the guidance range due to lower-than-expected service revenues and unscheduled payroll runs, the company emphasized the significant value brought by Beti’s adoption and usage. This led to flawless payrolls, minimizing errors and eliminating billable items such as corrections and unscheduled payrolls. They achieved an impressive GAAP net income of $75.2 million and adjusted EBITDA of $165.6 million, indicating a third-quarter margin of nearly 41%, up over 300 basis points year-over-year. Non-GAAP net income for Q3 2023 was $102.4 million, a 39% increase from the prior year. Paycom also maintained a robust balance sheet. Client funds held reached approximately $2.1 billion daily. Looking ahead, Paycom adjusted its guidance model, factoring in increased Beti usage and potential macro headwinds. The company expects Q4 2023 total revenues from $420 million to $425 million, with adjusted EBITDA anticipated between $169 million and $174 million.