Paylocity Lifts Annual Forecasts After Revenue Reaches $451.7 Million In First Quarter
Profit increased, but quarterly operating cash flow fell as Paylocity spent $152.5 million on share buybacks.
Paylocity, which sells cloud software for payroll, human resources, finance and IT, raised its fiscal 2027 revenue and profitability forecasts Thursday after first-quarter revenue reached $451.7 million, up 10.7% from a year earlier. The company attributed the higher outlook to its quarterly performance and sales momentum entering its main selling season, according to results released with its SEC filing.
Higher Earnings, Less Quarterly Cash
Paylocity's recurring and other revenue grew 12.0% to $424.5 million in the quarter ended September 30, 2026. Interest earned on money held for clients was $27.199 million, down from $29.314 million a year earlier.
Net profit increased to $57.6 million from $48.0 million. Diluted earnings per share reached $1.07 versus $0.86, with the average diluted share count falling to 53.7 million from 55.9 million.
Operating profit was $82.2 million, compared with $74.2 million a year earlier. Adjusted operating profit rose to $133.9 million from $121.2 million; that measure excludes stock-based pay and related payroll taxes, amortization of purchased intangible assets and certain other costs.
Quarterly cash from operations moved the other way, falling to $79.7 million from $86.5 million. Over the twelve months ended September 30, 2026, operating cash flow reached $526.5 million, or 29.0% of revenue, versus $413.2 million and 25.2% a year earlier.
Free cash flow—operating cash after spending on internal software and property and equipment—totaled $416.7 million over those twelve months, against $336.0 million a year earlier. Its share of revenue increased to 23.0% from 20.5%.
Ignite AI And Share Buybacks
Toby Williams, Paylocity's president and chief executive officer, said, “Our growth continues to be led by Ignite AI.” Williams also pointed to the recently announced Recruiting Optimizer and said Elevate Solutions and Paylocity for Retirement were gaining momentum.
The company completed its Aidora acquisition in July 2026 to expand AI-powered employee-leave management. Paylocity's platform spans payroll and tax filing, recruiting, benefits, employee communications, expenses and access to company systems; clients typically have 10 to 5,000 employees.
Paylocity bought back 1.1 million shares for $152.5 million during the quarter. Since May 2024, repurchases have totaled $850.2 million for 5.7 million shares. At September 30, 2026, the company had $194.5 million in cash and equivalents and $131.3 million in long-term debt from its credit facility.
PCTY shares rose about 3% to $175.05 in Friday trading, with the company valued at $8.8 billion.
Annual Revenue Outlook Tops $1.9 Billion
Management now expects fiscal 2027 revenue of $1.910 billion to $1.925 billion, representing approximately 8% growth. Recurring and other revenue is forecast at $1.792 billion to $1.807 billion, or approximately 9% growth.
The annual forecast for adjusted earnings before interest, taxes, depreciation and amortization is $711.5 million to $721.5 million. Excluding interest earned on client funds, the range is $593.5 million to $603.5 million.
For the second quarter, Paylocity expects total revenue of $452.5 million to $457.5 million, representing approximately 9% growth. Its recurring and other revenue forecast is $423.0 million to $428.0 million, or approximately 10% growth.
The second-quarter adjusted earnings forecast is $152.5 million to $156.5 million, or $123.0 million to $127.0 million excluding interest earned on client funds.
Sources
- 8-K Filing — Paylocity Holding Corp (PCTY) — SEC EDGAR
- Exhibit pcty-20261105xex991.htm — Paylocity Holding Corp 8-K exhibit — SEC EDGAR
- Paylocity Holding Corp (PCTY) (Q1 2027) Earnings Call Highlights: Revenue Beat and Raised ... — Yahoo Finance
- Paylocity Announces First Quarter Fiscal 2027 Financial — globenewswire.com
