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ADP

Automatic Data Processing, Inc.

ADP

Automatic Data Processing, Inc. • NASDAQ
$255.30 ▲ 0.38% (+0.97)
Market Cap $103.26 B
52w High $329.93
52w Low $247.18
Dividend Yield 6.80%
P/E 25.18
Volume 975.34K
Outstanding Shares 404.45M

Income Statement

Period Revenue Operating Expense Net Income Net Profit Margin Earnings Per Share EBITDA
Q1-2026 $5.175B ▲ $2.462B ▲ $1.013B ▲ 19.574% ▲ $2.5 ▲ $1.566B ▲
Q4-2025 $5.127B ▼ $1.372B ▲ $910.6M ▼ 17.762% ▼ $2.24 ▼ $1.421B ▼
Q3-2025 $5.553B ▲ $1.238B ▲ $1.25B ▲ 22.501% ▲ $3.07 ▲ $1.842B ▲
Q2-2025 $5.048B ▲ $1.221B ▲ $963.2M ▲ 19.079% ▼ $2.36 ▲ $1.541B ▲
Q1-2025 $4.833B $1.136B $956.3M 19.788% $2.34 $1.512B

Balance Statement

Period Cash & Short-term Total Assets Total Liabilities Total Equity
Q1-2026 $7.944B ▲ $54.321B ▲ $47.947B ▲ $6.374B ▲
Q4-2025 $7.847B ▲ $53.369B ▼ $47.181B ▼ $6.188B ▲
Q3-2025 $2.681B ▲ $56.449B ▼ $50.593B ▼ $5.855B ▲
Q2-2025 $2.216B ▼ $64.097B ▲ $59.019B ▲ $5.078B ▼
Q1-2025 $7.347B $49.511B $44.163B $5.349B

Cash Flow Statement

Period Net Income Cash From Operations Cash From Investing Cash From Financing Net Change Free Cash Flow
Q1-2026 $1.013B ▲ $642.3M ▼ $-1.863B ▼ $164.1M ▲ $-1.063B ▼ $595.6M ▼
Q4-2025 $910.6M ▼ $1.439B ▼ $423.2M ▲ $-5.057B ▲ $667.2M ▲ $1.405B ▼
Q3-2025 $1.25B ▲ $1.526B ▲ $-555.9M ▲ $-9.399B ▼ $-8.405B ▼ $1.489B ▲
Q2-2025 $963.2M ▲ $1.15B ▲ $-1.258B ▲ $13.974B ▲ $13.813B ▲ $1.111B ▲
Q1-2025 $956.3M $824.4M $-1.644B $-6.492B $-7.295B $765.6M

Revenue by Products

Product Q2-2025Q3-2025Q4-2025Q1-2026
Global
Global
 $650.00M ▲$650.00M ▲$690.00M ▲$690.00M ▲
HCM
HCM
 $2.13Bn ▲$2.39Bn ▲$2.12Bn ▼$2.16Bn ▲
HRO
HRO
 $940.00M ▲$1.06Bn ▲$910.00M ▼$910.00M ▲
Professional Employee Organization Services Segment
Professional Employee Organization Services Segment
 $1.06Bn ▲$1.09Bn ▲$1.09Bn ▲$1.13Bn ▲
Interest on Funds Held for Clients
Interest on Funds Held for Clients
 $270.00M ▲$360.00M ▲$0 ▼$0 ▲

Five-Year Company Overview

Income Statement

Income Statement ADP’s income statement shows a steady, healthy growth story. Revenue has risen each year over the past five years, and profits have grown even faster than sales, which means margins are gradually improving. The company converts a good share of its revenue into operating profit and net income, pointing to strong pricing power and tight cost control. Earnings per share have climbed consistently as well, helped by both rising profits and likely share repurchases. Overall, the business looks mature but still growing, with solid profitability and a track record of incremental improvement rather than big swings. Key watchpoints are the company’s exposure to employment levels and wage trends, which can influence payroll volumes and related fees, but recent years suggest ADP has managed through different environments quite well.

Balance Sheet

Balance Sheet The balance sheet is sizable and reflects ADP’s role in handling client payroll funds, which naturally inflates total assets. Cash has trended upward over time, giving the company a reasonable liquidity cushion. Debt, however, has increased more recently, meaning leverage is higher than it was a few years ago. Equity has been rebuilding after a period when it was relatively light, which may reflect past shareholder returns such as buybacks and dividends. The structure is typical for a mature, highly cash-generative service company, but the rising debt load is something to monitor, especially if interest rates stay elevated. Overall, the balance sheet looks serviceable, but the story here is more about efficient capital use and ongoing shareholder returns than about building a large net-cash position.

Cash Flow

Cash Flow Cash generation is a clear strength. Operating cash flow has grown over the period and generally tracks or exceeds the growth in net income, which indicates earnings quality is solid and not overly dependent on accounting adjustments. Free cash flow has risen steadily as well, helped by relatively modest capital spending needs. ADP doesn’t need heavy investment in physical assets to grow, so a large share of its cash can be directed to dividends, buybacks, debt service, or acquisitions. The main risk to watch is macro-driven: if employment slows or client volumes weaken, cash flow could soften. But the recent trend shows a resilient, dependable cash engine with good flexibility for management’s capital allocation choices.

Competitive Edge

Competitive Edge ADP holds a very strong competitive position in payroll and human capital management. Its main advantages are scale, reputation, and the hassle of switching. Once a company embeds ADP into payroll, benefits, time tracking, and HR workflows, moving to another provider is disruptive, risky, and time-consuming. That stickiness translates into stable, recurring revenue. The brand is trusted, especially around compliance, tax, and data security—critical areas where mistakes are costly. ADP also benefits from serving clients of all sizes, from small businesses to global enterprises, and from operating in many countries, which deepens its experience and reach. Its large and growing dataset on millions of workers gives it a unique edge in analytics and benchmarking, further tightening client relationships. Competitive pressure from cloud-native HR platforms is real, but ADP’s scale, integrated offerings, and entrenched role in core payroll workflows form a substantial moat.

Innovation and R&D

Innovation and R&D Innovation at ADP is increasingly centered on artificial intelligence, analytics, and better user experiences. The company is layering generative AI and machine learning into its platforms to automate routine tasks, catch payroll errors before they happen, and give HR leaders quick, conversational access to workforce insights. ADP Assist, its cross-platform AI layer, is a key pillar: it powers anomaly detection, on-demand analytics, and proactive recommendations across products like Workforce Now and Global Payroll. This is made more powerful by ADP’s massive anonymized dataset, which spans millions of employees and gives it an information advantage competitors struggle to match. The new Lyric HCM platform shows ADP pushing toward more modern, flexible, and global HR systems, designed for complex organizations and embedded AI. Continued enhancements to DataCloud, benchmarking tools, and the overall user interface suggest ADP is not just defending its legacy business but actively reshaping it around data, intelligence, and usability.

Summary

ADP looks like a mature, high-quality business with steady growth, strong profitability, and robust cash generation. Its income statement tells a story of consistent expansion and improving margins, while cash flows comfortably support investment and shareholder returns. The balance sheet is solid but more leveraged than a few years ago, a trade-off that seems intentional as the firm optimizes its capital structure. Its competitive position is anchored by scale, trust, and high switching costs, all reinforced by a uniquely rich dataset and a broad, integrated product suite. On the innovation front, ADP is leaning hard into AI, analytics, and next-generation HCM platforms, aiming to deepen its role as a strategic partner rather than just a payroll processor. Key uncertainties remain around economic cycles, employment levels, and competitive technology shifts, but the overall profile is that of a durable leader continuously upgrading its capabilities.

NEWS

November 25, 2025 · 8:15 AM UTC

ADP National Employment Report Preliminary Estimate for November 8, 2025

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November 24, 2025 · 10:18 AM UTC

ADP Workforce Now® Named a Leader in Human Capital Management 2025 Evaluation by Independent Research Firm

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November 20, 2025 · 8:00 AM UTC

ADP to Present at Upcoming Investor Conference

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November 20, 2025 · 7:05 AM UTC

ADP Launches Unified Global Workforce Management Suite Across HCM Platforms

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November 17, 2025 · 7:35 AM UTC

HR in 2026 will be Defined by the Impact of AI Innovation on Work

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