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OKLAHOMA CITY - Paycom Software, Inc. (NYSE:PAYC) reported third-quarter earnings that narrowly missed analyst expectations, sending shares down 9% as investors reacted to the slight earnings shortfall despite revenue growth.
The human capital management software provider posted adjusted earnings of $1.94 per share for the quarter ended September 30, 2025, falling short of analyst estimates of $1.95. Revenue came in at $493.3 million, slightly above the consensus estimate of $492.92 million and representing a 9.1% increase YoY from $451.9 million in the same period last year.
Recurring revenue, which constituted 94.6% of total revenues, grew 10.6% to $466.5 million compared to the prior year period. The company maintained its full-year revenue guidance of $2.045 billion to $2.055 billion, in line with analyst expectations of $2.05 billion.
"We delivered another strong quarter of double-digit organic recurring revenue growth and expanding margins," said Paycom founder, CEO and chairman, Chad Richison. "Our award-winning products Beti, GONE and IWant continue to be differentiators in the market, expanding our sales pipeline."
Adjusted EBITDA increased to $194.3 million, representing 39% of total revenues, compared to $171.3 million in the same quarter last year. GAAP net income was $110.7 million, or $1.96 per diluted share, which included a tax-adjusted gain of $26.3 million related to modification of the company’s naming rights agreement.
During the quarter, Paycom paid $21.1 million in cash dividends and repurchased over 1 million shares of common stock for $223.4 million. The company reported cash and cash equivalents of $375 million as of September 30, 2025, with no debt.
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