Paycom at Baird Conference: Automation and Growth Strategies

On Tuesday, 03 June 2025, Paycom Software Inc. (NYSE:PAYC) presented at the Baird Global Consumer, Technology & Services Conference 2025. The conference call, led by CEO Chad Richeson and CFO Bob Foster, provided a strategic overview of the company’s focus on automation, product development, and client satisfaction. While highlighting growth potential and innovation, the company also addressed past challenges in client transitions.

Key Takeaways

• Paycom is launching a command-driven system leveraging AI to enhance user access to information and task automation.
• The company aims to improve client retention rates to 92-93% and is focused on regaining lost clients.
• Sales strategies emphasize increased productivity, with individual sales reps targeting $4 million in annual sales.
• Capital expenditure is shifting from infrastructure to product development and AI integration.
• Paycom’s automation efforts are expected to improve margins and streamline processes for clients.

Product and Technology Updates

• Command-Driven System: Paycom plans to introduce a new system within two to three months, allowing users to interact with the platform through AI-driven commands, simplifying access to information and tasks.
• AI Integration: AI technology is being integrated to enhance system accuracy and understand user intent, particularly in payroll and HR processes.
• Current Tools: The "Ask Here" feature uses AI to efficiently navigate previously answered questions and resources.

Sales and Marketing

• Sales Strategy: Paycom has returned to foundational sales training, focusing on role play and unit counts to boost sales productivity.
• Market Opportunity: With a significant market opportunity among 1.8 million clients shared with competitors like ADP and Paychex, Paycom aims to expand its market share.
• Sales Teams: The company operates 57 sales teams and plans to grow to over 100 teams, opening new offices and relocating successful managers to capitalize on market potential.

Client Retention and Satisfaction

• Client Satisfaction: Improvements in product usage strategies are leading to higher client satisfaction scores.
• Betty Transition: Paycom acknowledges initial disruptions during the transition to the Betty system but remains committed to offering superior automation solutions.
• Retention Goals: The company is actively working to restore client retention rates to previous levels and is focused on winning back lost clients.

Automation and Efficiency

• Automation Focus: Paycom is enhancing automation in both client-facing and internal processes to boost efficiency and reduce errors.
• Margin Improvement: The company anticipates that increased automation will lead to improved margins by streamlining operations and minimizing manual interventions.

Capital Allocation

• Capital Expenditures: With corporate campus infrastructure largely completed, capital expenditure will now focus on product development and AI.
• Free Cash Flow: Paycom is strategically managing its free cash flow to support investments that drive future growth, though specific guidance was not provided.

Readers are encouraged to refer to the full transcript for a detailed understanding of Paycom’s strategic initiatives and outlook.

Full transcript - Baird Global Consumer, Technology & Services Conference 2025:

Marc Marcon, Analyst, Baird: All right. Good afternoon, everybody. My name is Marc Marcon. I follow the Human Capital Technology and Solutions for Baird. Our next presenting company is Paycom, a growing SaaS provider of payroll and HCM solutions to companies with between 60,000 employees that’s grown very rapidly over the years all on an organic basis with some of the best margins in the industry.

It’s one of my favorite American success stories. Chad Richeson, the CEO, founder and chairman, you know, basically ended up starting up the company with an SBA loan and 13 credit cards. And, you know, was able to build that into, you know, one of the fastest growing and most successful companies within the space. So, we’re always pleased to have you here, And then we’ve got Bob Foster. It’s a pleasure to welcome you to a Baird conference for the first time.

Bob’s the CFO. He joined the company back in 2022 and assumed the role of CFO in 2025. We’ve always had Craig over here with us. Yeah. And it’s a pleasure to meet you.

I’m gonna start off with a with a real softball. How how do you feel about the Oklahoma Thunder?

Chad Richeson, CEO, Founder and Chairman, Paycom: I I think they’re gonna do very well, you know. We have an advertising agreement with them. So, the more games they play, obviously, the better it is for us. But, I think they’ll sweep it in four. You think they’re gonna sweep it up in four?

Alright. I think Denver was probably their hardest, but we’ll see.

Marc Marcon, Analyst, Baird: We’ll see. So, there’s gonna be a lot of airing of Paycom Stadium.

Chad Richeson, CEO, Founder and Chairman, Paycom: Mhmm.

Marc Marcon, Analyst, Baird: I’ve got one question I’ve been asking everybody, so I hope you indulge me. It’s not a Paycom specific question. But, you know, post election, there was a lot of optimism with regards to the environment. You know, since the election, we’ve had Liberation Day and obviously a dampening of animal spirits. Right now, it seems like the equity markets are basically shrugging off tariff concerns.

What are you seeing in terms of, you know, smaller and medium sized businesses and up to the enterprises that you’re dealing with from that perspective?

Chad Richeson, CEO, Founder and Chairman, Paycom: Yeah, I mean, we’re not seeing anything differently than, you know, really what we’ve seen in the past. I mean, you know, we have such a small part of the TAM right now. So, you know, when we’re doing well, it’s because of the plans that we had and the strategies that we deployed to do well. I mean, our two largest competitors from a size perspective, if you combine both of their client bases together, they have 1,700,000 clients. And we have 36,000 clients.

So, for us there’s always demand there. It’s, you know, how are we going to go capture it? And we have not seen anything politically or macro or otherwise that’s impacting that to the negative for us.

Marc Marcon, Analyst, Baird: And how’s it impacted your spending programs? I mean, just in terms of just that general macro

Chad Richeson, CEO, Founder and Chairman, Paycom: I would say our our spending’s starting to change, but not because of that. It’s really because of our product releases, and we’ve been focused on automation, not just for the client, but also on the back end for ourselves. And the more we focused on that, you know, the greater the impact that it’s had on on on where we spend our money. That’s great.

Marc Marcon, Analyst, Baird: Now I’d like to shift over to Paycom specific questions. Know, Betty, it’s a great product. I’ve demoed it multiple times. I think it’s fantastic. I’m wondering if you can talk a little bit about the evolution of your approach to marketing Betty, to messaging around Betty.

Because when we think about it, it’s like the most automated solution, the ROI, those are all things that are very tangible to HR decision makers. How are you, how’s that evolution gone? And where are you in that journey in terms of marketing that?

Chad Richeson, CEO, Founder and Chairman, Paycom: Yeah, and so, you know, we started off payroll in the early days, and then we added time and labor management, benefits, expenses, learning management. Just all all of that that we have today. And it was all in a single system as it still is today. And you eliminated the need of integrate for integration. Now, you kind of fast forward and we’ve developed more and more products that allow you to utilize a full system and make it count.

Well, Betty was one of those because we’re doing the time and and labor management, the people are already using the expense management within our our system. Obviously, we’re doing the payroll and so, and time off request and what have you. And so, you were able to bring that all together and actually put it in the employee’s hands where they could, fix and edit payroll before they became issues after they were paid. You know, were able to fix problems and prevent things from happening. And so, you know, that was a piece that we did and we rolled that out which really put the payroll in the people’s hands.

You know, as we look into the future, that changes even more. Mean, I mentioned this in December at a conference that I was at and it’s still true today. I mean, the future of our industry will all be command driven. You will not navigate a system. And, you know, we expect we’ll be rolling out our version here in the next, you know, this year.

But but the future of our industry, you’ll tell the system what you want it to do or you’ll ask it for the information that you want it to give you. You will not go screen to screen and have to navigate it. And that will be both at the employee and the employer level. There are so many things that, you know, there’s not like 14 different ways to get a payroll right. There’s only one.

There’s not many different ways to get your time card right. There’s only one. I mean, it’s either perfect or it’s wrong. And so when you have something like that, when you’re always trying to hit something that’s exact, you can automate it. You gotta know what you’re doing.

But the better we’ve gotten with these tools, which we’re releasing a lot right now, the easier it is for us to see kinda what the future’s gonna look like. And so we have all these this data. And and that’s different than our competitors. Our competitors, they try to exact the same type of result, but there are multiple systems and there’s integration. When you move to a command driven system, not unlike Betty, you require all those data pieces.

So for instance, if I asked, tell me about Mark’s career, you know, in our system, and I’m using it on my phone right now, I can say, me about Mark’s career. It’s gonna tell me everything you’ve done so far at Paycom, and because you used our applicant tracking system to apply, cause we also have all of our pre employment services, it’s gonna go through all of your past jobs too. I could even ask it, tell me about your performance. Well, all your performance and compensation’s in our system too. And so, that’s the point is today in order to utilize systems, you have to become, I mean, maybe somewhat of an expert on the administration, especially on the back end.

And so with a command driven system, you’re putting the information as well as the tasks in people’s hands. And you’re putting it in more people’s hands than what you could have before. If I need to know something about a specific employee or department, I can obviously use our system. But it’s been a while since I’ve gone into Advanced Report Writer and run a of different reports. And so I might have to ask somebody to do that for me.

Well, a command driven system, I don’t have to ask anybody to do anything. I ask for it right then. And and it might be small. I might be asking This could be an example. I’m about to promote this person.

I need to make sure I’m giving them the right title. What’s this what’s their boss’s title? I mean, that might take me a second. I can go into the system and find it. I just ask the system.

I can say, who’s taking time off? What’s my what’s the schedule look like in the next? Who’s taking time off? Anything that I have a question about. I wanted to see I ran into someone in the hall the other day and and they’re part of a dev group.

I’m heavy into dev, have been back since November. And I’m like, where did this person come from? What was their hiring? What did they do before now? What did they do before this?

I mean, normally, I’d have to ask somebody that. I just asked my my prompt. They gave me their information. So that’s the way the future’s gonna be. It’ll all be command driven.

You won’t navigate. You’ll command the system to go get what you want it to to get retrieved for you or to go do what you want it to do. And so that that’s just one thing that we’re doing. But, you know, there there’s a lot as we look into the future. There’s a lot that we can do now that we couldn’t before.

Marc Marcon, Analyst, Baird: Well, and you’ve been leveraging AI and you just released Ask Here. Is it what what percentage of those capabilities that you’re talking about does Ask Here currently have?

Chad Richeson, CEO, Founder and Chairman, Paycom: I mean, Ask Here is not I mean, it’s not command driven yet. Ask Here is, going through and filtering through their list of questions they’ve already answered all in the past. And they’ll go through and filter through their handbook and things like that to answer a question, for them. But but absolutely, you know, we use AI in that. A lot of AI is used to determine, what did you ask?

You know, it might be your voice, it might be you know, I can ask in our command driven system, I can say, when did you start? Well, does that mean when did you clock in today? Did that mean when were you hired? What does that mean when did you start? Well, that’s part of AI.

You have to be able to work with that. You have to be able to speak the language and know that these are the different variables of that speech. And so that’s a lot of what we work with so that we know what to return you. My point is is in in our business, you have to be a % accurate or you get an f. I’ve always said that.

If we’re 99.99% accurate, we get an f. Someone didn’t get paid right, there’s tax problems, there’s liability, what have you. The good thing about our business though is it does calculate to an exact answer. And because of that, we are able to automate it a lot easier.

Marc Marcon, Analyst, Baird: When are we gonna see this?

Chad Richeson, CEO, Founder and Chairman, Paycom: I would say within the next, you know, two, three months, we’ll start rolling things out.

Marc Marcon, Analyst, Baird: Within the next two to three months. So, when I go to HR tech, I’ll be

Chad Richeson, CEO, Founder and Chairman, Paycom: able to demo it? In October? Yep. Let’s see. I’m open.

I’ve got it right here on the phone right now, but, you know, see.

Marc Marcon, Analyst, Baird: I mean, sounds it sounds really powerful. I mean, can can you actually run, like, applications? Like, if you were running a if you’re running a business, could you actually put in there, like, how much would it cost to run a third shift?

Chad Richeson, CEO, Founder and Chairman, Paycom: Our system. Oh, well, if the data’s in our system, you can come up with it. So, there’ll be different variations of it. But in the beginning, you’ll be able to ask it any question about an employee, and it’ll pull you any information that is in our system.

Marc Marcon, Analyst, Baird: So That sounds pretty exciting.

Chad Richeson, CEO, Founder and Chairman, Paycom: I’m sure our competitors will come out with one tomorrow and say they developed it. We’ll see.

Marc Marcon, Analyst, Baird: We’ll see. You know, your trust radius scores are really big. When I looked through the annual report, you said your number one priority was actually customer satisfaction. Can you talk a little bit about that, just in terms of, you know, because when you went through the Betty transition initially, there were, you know, among some of your players, some of the people on your team, there were certain, you know, people that were a little bit heavy handed in terms of talking to, to clients about switching over to Betty. How how has that changed?

What are you seeing in terms of your client scores? Client scores fully utilizing the system, things of that nature.

Chad Richeson, CEO, Founder and Chairman, Paycom: Yeah, I mean, we’re doing a lot better with that, obviously. You know, we were so excited about Betty because of all the things it does for a client. I mean, we can look and see how many payroll issues each client has every payroll. And so when you’re able to prevent those, that really impacts the employee that’s getting paid in a big way. And then it obviously impacts the client, because they’re the ones that have to pay to fix it.

And or live with an upset employee. I think there’s a stat that says if you pay an employee wrong more than twice, there’s a 50% chance they’re leaving kind of thing. So, you know, people expect to get paid right. I mean, it’s not a, it’s just what we all expect. And so, but I think as you look into the future, and and again, you’re talking about Betty.

We’re not, I think we were disrupting a little bit of our client base. I don’t, if you’re on Betty, great. If you’re not on Betty, you’re still on the Paycom system, it’s the most automated system. And we want you to stay on Paycom. I do believe when you look at the future, it does make more sense for employees to be able to do things that only they know if it’s correct or not anyway.

So it’s not something that we’ve stopped on, but I think that we’ve we’ve recognized that our priority isn’t always our client’s priority at that moment. But we haven’t changed, you know, our goal of of making sure that that all clients get the opportunity to achieve the greatest ROI that we have

Marc Marcon, Analyst, Baird: to offer. What percentage of clients are now on Duddy?

Chad Richeson, CEO, Founder and Chairman, Paycom: You know, haven’t updated that. I think last update, we probably said 65, 70 percent. It’s more than that now. Okay. But, we haven’t updated that.

Alright. Because we see it as one client base, not two.

Marc Marcon, Analyst, Baird: But it sounds like the the client satisfaction scores are going up across the board. Is that correct?

Chad Richeson, CEO, Founder and Chairman, Paycom: It is. I mean, there’s a there’s been a very big focus. You know, I went back into I had our, product group forever. Gave it up for five years, took it back over in 2023. And so we’ve been really focused on not just Betty, not any one product, but the entire, usage strategy.

And a lot of it comes down to configurations. You know, a a business has the best intent to, utilize a system of full automation, and then something changes in their business environment, they buy something, make a change, or something changes in ours, we’re rolling something new out. So it’s very important for them to achieve that ROI for us to make it easy for them to digest changes and not have to, do a lot of work to receive the value. And so we’ve been focused on that, for quite some time now. And it’s it’s it’s making an impact as you see, in both whatever score you’re looking at as well as in our Net Promoter Scores that we measure.

Marc Marcon, Analyst, Baird: And when we think about like client retention, I mean if the scores are going up, naturally you would assume that client retention rates are going to start moving back up. Talk a little bit about that?

Chad Richeson, CEO, Founder and Chairman, Paycom: Well, think we’ve talked about we have the haves and the have nots. We’ve been trying to, and it doesn’t it doesn’t cost you anymore to use the system correctly. It’s the same price. Say it’s a hammer. I go to the store, I buy a hammer.

I turn it around and use the cloth side to beat in the nail. I mean, you know, it didn’t it didn’t cost me anymore to turn it around and hit in the nail the right way, you know. And so that’s really about what we’re doing right now to drive usage and to help clients achieve that ROI.

Marc Marcon, Analyst, Baird: I mean, your client retention scores had gone up into the 92, 90 three percent range. Do you think we can get back there?

Chad Richeson, CEO, Founder and Chairman, Paycom: That’s our hope. Yeah. I mean, definitely. The hope is that greater experience and the greater ROI that clients actually achieve, the longer they stay. And, you know, everything we’re doing right now is about that.

It’s about, increasing the value that the client can achieve as well as increasing our opportunities to go to market. It’s really both, you know? We’re looking to deliver more of the product to clients that hadn’t used us in the past, as well as working with our current client base to get them in a better position.

Marc Marcon, Analyst, Baird: I was going through your website. I saw a number of examples of, you know, clients that left you that have come back. Can you talk a little bit about how much you’re how often you’re seeing that?

Chad Richeson, CEO, Founder and Chairman, Paycom: Yeah. I mean, we increased our strategy to get clients back. You know, you think of a breakup, and sometimes you’ve got to go ask that person to come back to you. And I think that we’ve been through that. And we have a little bit different strategy for how we go after lost clients no matter how long they’ve been gone because they didn’t impact their situation.

Maybe they got a lower price. Maybe they got but their their situation didn’t change. And so our opportunity is going back out there and delivering on the promise that we know that we can deliver on. And that’s been a focus of ours.

Marc Marcon, Analyst, Baird: Wondering if we can switch over to go to market. You know, you had Amy take over sales. Can you talk a little bit about some of the things that she’s done to fine tune, you know, the training, the selection, you know, what sort of opportunities people go for, and what that’s done in terms of sales productivity.

Chad Richeson, CEO, Founder and Chairman, Paycom: I mean, back to basics is all I would say. I would say that we eliminated a lot of extra things that we implemented into training and just went back to the basics for us. I mean, our training had gotten to seventeen weeks, primarily off-site. I mean, you know, And after about five weeks, you’re untraining people. You know.

And so we started implementing a lot more of the role play that we’ve done in the past. And and really focused people. I think we had a lot of elephant hunters And focused them on unit counts as well. So there’s a lot that we did. You know, Jeff York’s still at the company, has been at the company.

I know he retired as a chief sales officer. I mean, I would say he’s probably the greatest sales mind out there. He continues to work with Amy every day as well. And, you know, together they’ve kind of gone back to the basics. And it makes an impact for us.

Marc Marcon, Analyst, Baird: It seems like it’s working. I mean, if we take a look at, like, your sales trajectory and your bookings, there was a period of time where you were consistently growing 25%, thirty % organically. Obviously, there’s a lot of larger numbers. But it started trending down, and then it’s stabilized, it looks like it might even be trending up a little bit. Can you talk a little bit about, you know, what your aspirations are in terms of sales growth?

Because we take a look, it’s like, take ADP and Paychex combined, 1,800,000 clients, you’ve got less than 40,000. There’s natural churn, there’s natural opportunities. How are you thinking now about the potential revenue growth rate and the algorithm there?

Chad Richeson, CEO, Founder and Chairman, Paycom: You know, as much as we can get. I mean, I don’t really think of it in terms of a percentage other than, you know, to your point, there’s 1,800,000 clients out there with just the two. You add everybody else, there’s a lot more of that. We have less than 40. We’re the most automated solution.

So we should have more clients, and that’s a focus of ours. I think it’s very important that we remove impediments to value. You know, there’s a lot of things you buy. I mean, you might have bought a refrigerator that has technology in it. It can do a lot of things, but you gotta set it all up.

Do you, though? You know? There’s there’s there’s different techniques now and into the future where a system can work with you to make sure that you’re getting the full value and keep you up to date on it. And so that’s really, I think, where we have the chan that’s really the challenge of our industry. I don’t know that it’s just unique to Paycom.

But it’s something that we’ve been driving toward. And it’s in our hands to be able to fix it. I mean, we can’t, so.

Marc Marcon, Analyst, Baird: Well, and part of the growth algorithm is also coverage of territories. You’ve got 57 sales teams now. You just recently started up a group of them. But you went through several years where, you know, it was relatively stable without much change. How are you thinking about the number of sales teams that you could ultimately end up having, and what’s that going to end up doing in terms of driving the growth?

Chad Richeson, CEO, Founder and Chairman, Paycom: You know, when we looked at our opportunity, and again, a sales group is measured by the number prospects in a territory. About a couple thousand prospects in our sweet spot, that’s a territory right there. At one time when I looked at it, we could have over 100 sales teams just with the number of prospects that we have out there. You know, you’re not gonna have one sales team in New York City, you know, or one sales team in Atlanta. But you would have one in Tulsa, you know.

And so, some cities you can have multiple teams. And so we looked at, at that time it was over 100. Today we’re at 57. We hadn’t opened up, to your point, we hadn’t opened up any sales offices in the last three years. This year we opened up three.

As you know, we take a current sales manager who’s successful, we relocate them to a new city where they open it up, and then we backfill them with a sales rep who’s ready to be sales manager. You know, our logjam kind of, or or you know, what’s the, prevents us from being able to open up offices is if you have managers that aren’t yet at the success level where we’re ready to relocate them. Or if you have a bench that’s not ready to come in and backfill those managers from relocating. So when you have success in your sales organization, it kinda tells you when’s the right time to do that. We did, and so we had an opportunity to do three this year.

But I would say hundred total, you know, over time, when it makes

Marc Marcon, Analyst, Baird: How much time? What, I mean

Chad Richeson, CEO, Founder and Chairman, Paycom: I’d like to do it tomorrow, but, you know, it’s a function of having the backfill and having success.

Marc Marcon, Analyst, Baird: But, I mean, given that algorithm in terms of having the

Chad Richeson, CEO, Founder and Chairman, Paycom: I don’t know, Mark. I mean, it just kinda, I hope in my lifetime. You I mean, I don’t know. You know, it’s I’m sure

Marc Marcon, Analyst, Baird: you can make it happen if

Chad Richeson, CEO, Founder and Chairman, Paycom: you’ve But I believe what we’ve also been doing is growing the amount that any one sales rep can sell too. I mean, we’ve got reps that sell $4,000,000, you know, for one sales rep. I mean, when we IPO’d and worked with you, I mean, that’s that’s a city that would sell $4,000,000 if you’re lucky. You know? And so, it’s not just the number of sales teams that we add.

It’s also the amount, the productivity for any one sales rep’s Right. Continuing to go up as well.

Marc Marcon, Analyst, Baird: Can you talk a little bit about the, you know, you’re not only automating your clients’ business processes, but you’re automating your own. You already have some of the best, you know, EBITDA margins in the space. But and for a while there, it was stagnant or potentially going down a little bit. Now it’s starting to move back up. How should we think about the margins as you’re continuing to automate?

Chad Richeson, CEO, Founder and Chairman, Paycom: You know, they’re the same thing. Automating for the client is automating for us. Or automating for us is automating for the client. I mean, anything that we automate on the back end is to speed up a result for the client. Whether that’s on taxes, whether that’s setting up EDI files or benefit carrier file, whatever.

Anything that we can automate on the back end is focused on client value. And so whether we’re doing it on the client side, and there’s just work that we don’t have to do anymore, or whether we’re doing it on the back end and it’s impacting the service that’s being delivered to a client. We will always have a high touch service model. I’m not gonna automate relationships. You know?

But I think over time, you’ll see service people shift out of a task management into an influence of usage model. You know? Because sometimes people like to call and talk to somebody about how do I this, that, and the other. I don’t know that our system’s gonna mimic a conversation. But if you know the data you want, it’ll bring you the data.

If you know the task you want it to automate, it’ll do that. But I I don’t I don’t know that it’s gonna automate the conversation. I believe that’s gonna be done through our service individuals. So I always see us having a high touch sales model, high touch conversion model, and high touch service model, but we’re not trying to see how many times we can touch it, if that makes sense.

Marc Marcon, Analyst, Baird: And so where where are you in that journey, just in terms of automation and One yard line.

Chad Richeson, CEO, Founder and Chairman, Paycom: I mean, with what our plan is and where we are today. I mean, I think if you looked at us compared to others, we’re way way beyond that. But I think for our own plan and what’s possible today, you know.

Marc Marcon, Analyst, Baird: And so, I mean, that implies that the margins could actually improve much more than just small incremental changes from a long term perspective.

Chad Richeson, CEO, Founder and Chairman, Paycom: Yeah. I wouldn’t say that’s our, I mean, you know, I wouldn’t say that’s, that we’re doing it for that reason, but I do think the more automation you have, everyone wins. Right? The client wins because they’re getting the value without having to crawl through the forest to get it. We win for the same reason.

I mean, the only reason a client calls us is due to a deficiency in the product that we make. Why are they calling us? I mean, we make the product. We have control over all of it, You know? And so, we can also, you know, provide the solution there as well.

Marc Marcon, Analyst, Baird: You recently completed your fifth office in your big corporate park. CapEx, you know, some people are assuming it may end up coming down a little bit. Can you talk a little bit about capital expenditures and capital allocation? And how we should think about free cash flow conversion relative to EBITDA?

Bob Foster, CFO, Paycom: Bob? Yep. So, no, we have. We finished a lot of the infrastructure at the corporate campus. Our data center in Arizona is online.

And so when you look at the free cash flow, we had a good quarter. But we’re also finding things we’re still investing in our product and development. And AI is not expensive or not inexpensive to roll out. So we’re still going to be opportunistic on how we spend that. We’re we haven’t guided to free cash flow, but we are, you know, we focus on it internally for sure.

Marc Marcon, Analyst, Baird: I mean, would you anticipate, even though AI is not inexpensive, would you anticipate that the free cash flow as a percentage of EBITDA is going to increase at least marginally, over the next twelve months relative to where it’s been?

Chad Richeson, CEO, Founder and Chairman, Paycom: I don’t know that we can guide to that. I mean, think that we are, I think you’re gonna see a shift away from buildings into, because we’re substantially built, even as you look at our employment base, we’re still automating a lot. And then I think, you know, there is equipment and opportunities there. And fortunately, you know, even that’s coming down at a a pretty good rate. And especially when that what you can get from a capability.

So we are ambitious in what we’re doing. And so but I don’t think we know yet. You know, we’re doing what needs to be done. And we haven’t I would know yet. I wouldn’t say we don’t know yet.

We know what we’re doing. But I think from a percentage standpoint, I don’t think we’re ready to talk about that yet.

Marc Marcon, Analyst, Baird: Unfortunately, I think we’re out of time in this room, but we do have time for a breakout session. So please join me in thanking Chad and Bob for a terrific discussion.

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