Compared to Estimates, Paychex (PAYX) Q3 Earnings: A Look at Key Metrics

Paychex (PAYX Quick QuotePAYX – Free Report) reported $1.51 billion in revenue for the quarter ended February 2025, representing a year-over-year increase of 4.8%. EPS of $1.49 for the same period compares to $1.38 a year ago.

The reported revenue represents a surprise of +0.03% over the Zacks Consensus Estimate of $1.51 billion. With the consensus EPS estimate being $1.48, the EPS surprise was +0.68%.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company’s financial health.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock’s price performance more accurately.

Here is how Paychex performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

• Average investment Balance – Funds held for clients: $5.12 billion versus $4.98 billion estimated by three analysts on average.
• Average interest rates earned (exclusive of net realized gains) – Funds held for clients: 3.4% compared to the 3.4% average estimate based on three analysts.
• Average investment Balance – Corporate cash equivalents and investments: $1.54 billion compared to the $1.50 billion average estimate based on two analysts.
• Average interest rates earned (exclusive of net realized gains) – Corporate cash equivalents and investments: 4.3% versus the two-analyst average estimate of 4.5%.
• Revenue- Interest on funds held for clients: $42.90 million versus the six-analyst average estimate of $40.82 million. The reported number represents a year-over-year change of -2.3%.
• Revenue- Total service revenue: $1.47 billion compared to the $1.47 billion average estimate based on six analysts. The reported number represents a change of +5.1% year over year.
• Revenue- PEO and Insurance Services: $365.40 million versus the six-analyst average estimate of $371.35 million. The reported number represents a year-over-year change of +5.8%.
• Revenue- Management Solutions: $1.10 billion compared to the $1.10 billion average estimate based on six analysts. The reported number represents a change of +4.8% year over year.

View all Key Company Metrics for Paychex here>>>

Shares of Paychex have returned -4.6% over the past month versus the Zacks S&P 500 composite’s -2.9% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.