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# ADP Raises Profit Outlook To 10% To 12% EPS Growth As Client-Cash Interest Climbs 15%
- URL: https://www.bullished.co/adp-raises-profit-outlook-to-10-to-12-eps-growth-as-client-cash-interest-climbs-15-b721d5fc/
- Published: 2026-10-28T11:09:53.000Z
- Updated: 2026-10-28T14:46:16.000Z
- Description: The payroll company lifted its revenue and adjusted earnings-per-share growth targets after first-quarter profit outpaced sales.
- Author: Matteo Parrino
- Tags: Earnings, ADP, Industry: Industrials

[ADP](https://www.bullished.co/tag/adp/), which provides payroll, HR and workforce management software and outsourcing to employers, now expects adjusted earnings per share to grow 10% to 12% this fiscal year, up from 9% to 11% in its July outlook, [according to its earnings release](https://www.sec.gov/Archives/edgar/data/0000008670/000000867026000033/q1fy27exhibit99.htm?ref=bullished.co) on Wednesday. It also lifted its revenue growth forecast to about 6%, from 5% to 6%.

## Profit outran sales

First-quarter net earnings rose 11% to $1.1 billion, and diluted earnings per share climbed 14% to $2.83\. Adjusted diluted EPS rose 13% to $2.82\. Revenue grew 6% to $5.5 billion, also 6% on an organic constant-currency basis.

Adjusted EBIT, a measure of operating profit, rose 12% to $1.5 billion, and its margin widened 130 basis points to 26.8%. Employer Services segment margin also rose 130 basis points, while PEO Services margin was flat.

CEO Maria Black said ADP is "off to a strong start in fiscal 2027." CFO Peter Hadley said the quarter "exceeded our expectations across revenue growth, adjusted EBIT margin expansion, and adjusted EPS growth."

## Interest on client cash does the lifting

Interest on funds held for clients rose 15% to $329 million. Average client balances grew 6% to $36.9 billion, and the average yield rose 30 basis points to 3.6%.

The company raised its full-year client-funds forecast too: interest of $1.59 billion to $1.61 billion, up from $1.54 billion to $1.56 billion in July. It now assumes balances grow 4% to 5%, up from 3% to 4%, with yield rising to about 3.8%, from about 3.7%.

ADP's segments grew at similar rates. Employer Services revenue rose 6%, and U.S. pays per control, its gauge of employees on client payrolls, rose 2%. PEO Services revenue, from the business in which ADP and clients co-employ workers, rose 7%, and average worksite employees rose 2% to about 771,000.

## Buybacks double, outlook details

ADP spent $758.8 million repurchasing its stock in the quarter, against $366.0 million a year earlier. Diluted weighted average shares fell 2%.

The rest of the outlook is unchanged from July: adjusted EBIT margin expansion of 70 to 90 basis points and an adjusted tax rate of about 23%. Diluted EPS growth is forecast at 12% to 14%.

ADP held its analyst call at 8:30 a.m. ET Wednesday.

The company's new outlook puts fiscal 2027 adjusted EPS growth at 10% to 12%, measured from $11.12 in fiscal 2026.

Learn

- [Item 2.02: results of operations →](https://www.bullished.co/learn/8-k-items-explained/#item-202-results-of-operations)  
From 8-K Items Explained: What Every Item Code From 1.01 To 9.01 Tells You, With Examples

### Sources

- [8-K Filing — AUTOMATIC DATA PROCESSING INC (ADP)](https://www.sec.gov/Archives/edgar/data/0000008670/000000867026000033/adp-20261028.htm?ref=bullished.co) — SEC EDGAR
- [Exhibit q1fy27exhibit99.htm — AUTOMATIC DATA PROCESSING INC 8-K exhibit](https://www.sec.gov/Archives/edgar/data/0000008670/000000867026000033/q1fy27exhibit99.htm?ref=bullished.co) — SEC EDGAR
- [Automatic Data Processing (ADP) Stock Could Trade At A 17% Premium On Cash Flow](https://finance.yahoo.com/markets/stocks/articles/automatic-data-processing-adp-stock-130811243.html?ref=bullished.co) — Yahoo Finance
- [Paychex, Inc. (PAYX) vs. ADP and PAYC: Can Its Dividend Moat and Recurring Revenue Strength Restore Investor Confidence?](https://finance.yahoo.com/markets/stocks/articles/paychex-inc-payx-vs-adp-205443236.html?ref=bullished.co) — Yahoo Finance
- [ADP National Employment Report Preliminary Estimate for October 10, 2026](https://www.prnewswire.com/news-releases/adp-national-employment-report-preliminary-estimate-for-october-10-2026-302920098.html?ref=bullished.co) — prnewswire.com

### More on Automatic Data Processing

- [ADP Puts Payroll Inside PNC's Digital Banking Platform And Says More Embedded Deals Are Coming](https://www.bullished.co/adp-puts-payroll-inside-pncs-digital-banking-platform-and-says-more-embedded-deals-are-f263927d/)
- [ADP Raises Revenue And EPS Targets But Keeps Margin Outlook At 70 To 90 Basis Points](https://www.bullished.co/adp-raises-revenue-and-eps-targets-but-keeps-margin-outlook-at-70-to-90-basis-points-8ec80d18/)

[All Automatic Data Processing (ADP) coverage →](https://www.bullished.co/tag/adp/)