Revenue reached $5.9 billion in 2026Q3, though operating margins remain volatile, fluctuating between a negative 2.4% in 2026Q1 and a peak of 30.1% in 2026Q3 due to strategic investment cycles.
| Metric | TTM | Jun'25 | Jun'24 | Jun'23 | Jun'22 | Jun'21 | Jun'20 | Jun'19 | Jun'18 | Jun'17 | Jun'16 | Jun'15 | Jun'14 | Jun'13 | Jun'12 | Jun'11 | Jun'10 | Jun'09 | Jun'08 | Jun'07 | Jun'06 | Jun'05 | Jun'04 | Jun'03 | Jun'02 | Jun'01 | Jun'00 | Jun'99 | Jun'98 | Jun'97 | Jun'96 |
|---|
| Sales/Revenue | 21.6B | 20.56B | 19.2B | 18.01B | 16.5B | 15.01B | 14.59B | 14.18B | 13.33B | 12.38B | 11.67B | 10.94B | 12.21B | 11.31B | 10.67B | 9.88B | 8.93B | 8.87B | 8.78B | 7.8B | 6.84B | 7.98B | 7.75B | 7.15B | 7B | 7.02B | 5.94B | 5.54B | 4.8B | 4.11B | 3.57B |
| Revenue Growth % | 6.92% | 7.07% | 6.61% | 9.18% | 9.95% | 2.85% | 2.92% | 6.36% | 7.66% | 6.1% | 6.67% | -10.39% | 7.93% | 6.05% | 7.95% | 10.66% | 0.68% | 1.03% | 12.52% | 14.11% | -14.38% | 2.95% | 8.51% | 2.04% | -0.19% | 18.16% | 7.2% | 15.46% | 16.68% | 15.3% | 23.25% |
| Cost of Goods Sold | 11.35B | 10.11B | 9.61B | 9.21B | 8.77B | 8.03B | 7.88B | 7.55B | 7.28B | 6.73B | 6.31B | 5.9B | 6.58B | 6.06B | 5.7B | 5.22B | 4.59B | 4.41B | 4.23B | 3.68B | 3.22B | 4.04B | 3.53B | 3.1B | 2.97B | 2.9B | 2.56B | 2.38B | 2.06B | 1.72B | 1.52B |
| COGS % of Revenue | - | 49.16% | 50.06% | 51.11% | 53.14% | 53.52% | 54.04% | 53.3% | 54.61% | 54.38% | 54.11% | 53.97% | 53.95% | 53.58% | 53.48% | 52.83% | 51.37% | 49.74% | 48.25% | 47.19% | 47.06% | 50.59% | 45.46% | 43.33% | 42.41% | 41.33% | 43.18% | 42.89% | 43% | 41.89% | 42.52% |
| Gross Profit | 10.26B | 10.45B | 9.59B | 8.81B | 7.73B | 6.97B | 6.71B | 6.62B | 6.05B | 5.65B | 5.35B | 5.04B | 5.62B | 5.25B | 4.96B | 4.66B | 4.34B | 4.46B | 4.54B | 4.12B | 3.62B | 3.94B | 4.23B | 4.05B | 4.03B | 4.12B | 3.37B | 3.16B | 2.73B | 2.39B | 2.05B |
| Gross Margin % | 47.48% | 50.84% | 49.94% | 48.89% | 46.86% | 46.48% | 45.96% | 46.7% | 45.39% | 45.62% | 45.89% | 46.03% | 46.05% | 46.42% | 46.52% | 47.17% | 48.63% | 50.26% | 51.75% | 52.81% | 52.94% | 49.41% | 54.54% | 56.67% | 57.59% | 58.67% | 56.82% | 57.11% | 57% | 58.11% | 57.48% |
| Gross Profit Growth % | - | 8.98% | 8.92% | 13.9% | 10.85% | 4% | 1.29% | 9.44% | 7.11% | 5.48% | 6.33% | -10.43% | 7.07% | 5.82% | 6.47% | 7.35% | -2.6% | -1.86% | 10.26% | 13.81% | -8.26% | -6.73% | 4.43% | 0.41% | -2.04% | 22.02% | 6.65% | 15.68% | 14.46% | 16.54% | 19.45% |
| Operating Expenses | 6.11B | 5.04B | 4.65B | 4.3B | 3.93B | 3.65B | 3.56B | 3.62B | 3.47B | 3.23B | 3.11B | 3.02B | 3.4B | 3.21B | 3B | 2.84B | 2.56B | 2.63B | 2.82B | 2.61B | 2.32B | 2.38B | 2.79B | 2.53B | 2.36B | 2.5B | 2.39B | 2.06B | 1.83B | 1.61B | 1.39B |
| OpEx % of Revenue | - | 24.51% | 24.2% | 23.87% | 23.8% | 24.32% | 24.43% | 25.51% | 26.05% | 26.09% | 26.62% | 27.62% | 27.85% | 28.39% | 28.16% | 28.7% | 28.72% | 29.63% | 32.08% | 33.49% | 33.95% | 29.85% | 35.99% | 35.43% | 33.7% | 35.63% | 40.21% | 37.19% | 38.07% | 39.11% | 38.83% |
| Selling, General & Admin | 4.26B | 4.05B | 3.69B | 3.45B | 3.13B | 2.93B | 2.89B | 2.98B | 2.84B | 2.6B | 2.5B | 2.43B | 2.68B | 2.56B | 2.4B | 2.26B | 2.05B | 2.13B | 2.29B | 2.13B | 1.85B | 1.83B | 1.9B | 1.76B | 1.61B | 1.67B | 1.64B | 1.38B | 1.21B | 1.09B | 933.8M |
| SG&A % of Revenue | - | 19.71% | 19.23% | 19.18% | 18.96% | 19.55% | 19.81% | 21.02% | 21.28% | 21.02% | 21.45% | 22.18% | 21.96% | 22.6% | 22.53% | 22.86% | 22.96% | 23.99% | 26.09% | 27.26% | 27.04% | 22.96% | 24.54% | 24.6% | 22.94% | 23.73% | 27.67% | 24.82% | 25.15% | 26.47% | 26.18% |
| Research & Development | 778.3M | 988.6M | 955.7M | 844.8M | 798.6M | 716.6M | 674.1M | 636.3M | 635.4M | 627.5M | 603.7M | 595.4M | 718M | 654.3M | 599.9M | 577.2M | 513.9M | 499.7M | 525.9M | 486.1M | 472.3M | 550.3M | 581.16M | 499.19M | 474.84M | 514.28M | 460.27M | 412.4M | 375.2M | 296.5M | 249.6M |
| R&D % of Revenue | - | 4.81% | 4.98% | 4.69% | 4.84% | 4.78% | 4.62% | 4.49% | 4.77% | 5.07% | 5.17% | 5.44% | 5.88% | 5.79% | 5.62% | 5.84% | 5.76% | 5.64% | 5.99% | 6.23% | 6.91% | 6.89% | 7.49% | 6.98% | 6.78% | 7.33% | 7.75% | 7.44% | 7.82% | 7.21% | 7% |
| Other Operating Expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 306.77M | 274.68M | 279.08M | 320.86M | 284.28M | 272.8M | 244.6M | 223.4M | 201.6M |
| Operating Income | 4.15B | 5.41B | 4.94B | 4.51B | 3.8B | 3.32B | 3.14B | 3B | 2.58B | 2.42B | 2.25B | 2.01B | 2.22B | 2.04B | 1.96B | 1.82B | 1.78B | 1.83B | 1.73B | 1.51B | 1.3B | 1.56B | 1.44B | 1.52B | 1.67B | 1.62B | 986.5M | 1.1B | 908.4M | 781.2M | 665.2M |
| Operating Margin % | 19.2% | 26.32% | 25.74% | 25.02% | 23.05% | 22.16% | 21.53% | 21.2% | 19.34% | 19.53% | 19.27% | 18.41% | 18.21% | 18.04% | 18.37% | 18.47% | 19.91% | 20.64% | 19.67% | 19.31% | 18.99% | 19.56% | 18.55% | 21.24% | 23.89% | 23.04% | 16.61% | 19.92% | 18.93% | 19% | 18.65% |
| Operating Income Growth % | - | 9.49% | 9.69% | 18.48% | 14.4% | 5.82% | 4.56% | 16.55% | 6.6% | 7.57% | 11.62% | -9.39% | 8.96% | 4.13% | 7.36% | 2.66% | -2.87% | 6.03% | 14.57% | 16.05% | -16.88% | 8.6% | -5.26% | -9.26% | 3.47% | 63.9% | -10.6% | 21.48% | 16.28% | 17.44% | 19.08% |
| EBITDA | 4.64B | 5.9B | 5.5B | 5.06B | 4.32B | 3.84B | 3.62B | 3.41B | 2.96B | 2.73B | 2.54B | 2.29B | 2.56B | 2.36B | 2.28B | 2.14B | 2.09B | 2.14B | 2.05B | 1.8B | 1.54B | 1.84B | 1.87B | 1.79B | 1.95B | 1.94B | 1.27B | 1.38B | 1.15B | 1B | 866.8M |
| EBITDA Margin % | 21.47% | 28.68% | 28.67% | 28.07% | 26.17% | 25.56% | 24.82% | 24.08% | 22.18% | 22.09% | 21.74% | 20.95% | 20.96% | 20.84% | 21.4% | 21.69% | 23.37% | 24.11% | 23.3% | 23.02% | 22.59% | 22.99% | 24.18% | 25.08% | 27.87% | 27.61% | 21.4% | 24.84% | 24.03% | 24.43% | 24.3% |
| EBITDA Growth % | -21.07% | 7.14% | 8.89% | 17.07% | 12.59% | 5.9% | 6.1% | 15.5% | 8.09% | 7.79% | 10.68% | -10.43% | 8.57% | 3.27% | 6.51% | 2.7% | -2.41% | 4.55% | 13.91% | 16.26% | -15.88% | -2.09% | 4.58% | -8.16% | 0.74% | 52.48% | -7.67% | 19.37% | 14.77% | 15.9% | 18.56% |
| D&A (Non-Cash Add-back) | 489.8M | 486M | 561.9M | 549.3M | 515.1M | 510.7M | 480M | 409M | 377.6M | 316.1M | 288.6M | 277.9M | 336.2M | 317M | 323.3M | 318.2M | 309.2M | 308.1M | 319.1M | 288.8M | 246M | 273.9M | 436.69M | 274.68M | 279.08M | 320.86M | 284.28M | 272.8M | 244.6M | 223.4M | 201.6M |
| EBIT | 6.02B | 5.76B | 5.24B | 4.7B | 3.89B | 3.42B | 3.29B | 3.14B | 2.39B | 2.61B | 2.29B | 2.08B | 2.28B | 2.09B | 2.13B | 1.94B | 1.87B | 1.94B | 1.89B | 1.72B | 1.43B | 1.63B | 1.38B | 1.52B | 1.67B | 1.62B | 986.5M | 1.1B | 915.2M | 754.6M | 665.2M |
| Net Interest Income | -97.1M | -136.4M | -124.5M | -108.2M | -45.3M | -23.2M | -22.6M | -32.3M | -19.2M | -3.3M | 6.2M | 50.4M | 50.1M | 55.4M | 77.5M | 80.2M | 90.2M | 100.9M | 69M | 70.1M | 67.6M | 59.7M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 354.8M | 319.5M | 241.3M | 149.5M | 41M | 36.5M | 84.5M | 97.6M | 83.5M | 76.7M | 62.4M | 56.9M | 56.2M | 64.5M | 85.2M | 88.8M | 98.8M | 134.2M | 149.5M | 165M | 140.4M | 92M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 451.9M | 455.9M | 365.8M | 257.7M | 86.3M | 59.7M | 107.1M | 129.9M | 102.7M | 80M | 56.2M | 6.5M | 6.1M | 9.1M | 7.7M | 8.6M | 8.6M | 33.3M | 80.5M | 94.9M | 72.8M | 32.3M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | 1.52B | -101.8M | -70.7M | -68.6M | 900K | 36.6M | 40.9M | 1M | -295.3M | 112.8M | -13.4M | 56.7M | 51.9M | 44.4M | 163.1M | 108M | 85.8M | 74.7M | 86M | 117M | 63M | 31.2M | 56.29M | 127.13M | 113.96M | -91.85M | 303.1M | -19M | -24.4M | -28.2M | -29.8M |
| Pretax Income | 5.66B | 5.31B | 4.87B | 4.44B | 3.8B | 3.36B | 3.18B | 3.01B | 2.17B | 2.53B | 2.23B | 2.07B | 2.27B | 2.08B | 2.12B | 1.93B | 1.86B | 1.9B | 1.81B | 1.62B | 1.74B | 1.68B | 1.49B | 1.65B | 1.79B | 1.53B | 1.29B | 1.08B | 884.2M | 724M | 635.4M |
| Pretax Margin % | 26.22% | 25.83% | 25.37% | 24.64% | 23.06% | 22.4% | 21.81% | 21.2% | 16.29% | 20.45% | 19.15% | 18.93% | 18.63% | 18.43% | 19.9% | 19.56% | 20.87% | 21.48% | 20.65% | 20.81% | 25.5% | 21.02% | 19.27% | 23.02% | 25.51% | 21.73% | 21.71% | 19.58% | 18.43% | 17.61% | 17.82% |
| Income Tax | 1.32B | 1.23B | 1.12B | 1.03B | 855.2M | 762.7M | 716.1M | 712.8M | 550.3M | 797.7M | 741.3M | 694.2M | 772M | 720.2M | 733.6M | 678.5M | 655.9M | 576.5M | 650.3M | 602.3M | 670.6M | 622.5M | 558.96M | 627.05M | 686.2M | 600.29M | 448.8M | 387.7M | 278.9M | 210.5M | 180.7M |
| Effective Tax Rate % | 23.27% | 23.17% | 22.99% | 23.11% | 22.48% | 22.69% | 22.5% | 23.72% | 25.35% | 31.52% | 33.17% | 33.52% | 33.94% | 34.55% | 34.57% | 35.11% | 35.2% | 30.27% | 35.89% | 37.1% | 38.47% | 37.1% | 37.4% | 38.11% | 38.4% | 39.36% | 34.8% | 35.75% | 31.54% | 29.07% | 28.44% |
| Net Income | 4.35B | 4.08B | 3.75B | 3.41B | 2.95B | 2.6B | 2.47B | 2.29B | 1.62B | 1.73B | 1.49B | 1.45B | 1.52B | 1.41B | 1.39B | 1.25B | 1.21B | 1.33B | 1.24B | 1.14B | 1.55B | 1.06B | 935.57M | 1.02B | 1.1B | 924.72M | 840.8M | 696.8M | 605.3M | 513.5M | 454.7M |
| Net Margin % | 20.12% | 19.84% | 19.54% | 18.94% | 17.87% | 17.32% | 16.91% | 16.17% | 12.16% | 14% | 12.79% | 13.28% | 12.42% | 12.43% | 13.02% | 12.7% | 13.57% | 15.03% | 14.08% | 14.6% | 22.73% | 13.22% | 12.06% | 14.25% | 15.72% | 13.18% | 14.16% | 12.58% | 12.62% | 12.49% | 12.75% |
| Net Income Growth % | 8.68% | 8.73% | 9.96% | 15.7% | 13.48% | 5.35% | 7.58% | 41.46% | -6.5% | 16.14% | 2.75% | -4.18% | 7.83% | 1.25% | 10.71% | 3.53% | -9.1% | 7.84% | 8.52% | -26.72% | 47.24% | 12.81% | -8.11% | -7.51% | 19.04% | 9.98% | 20.67% | 15.12% | 17.88% | 12.93% | 15.17% |
| Net Income (Continuing) | 4.35B | 4.08B | 3.75B | 3.41B | 2.95B | 2.6B | 2.47B | 2.29B | 1.88B | 1.73B | 1.49B | 1.38B | 1.5B | 1.36B | 1.39B | 1.25B | 1.21B | 1.33B | 1.16B | 1.02B | 841.9M | 998.3M | 897.7M | 1.02B | 1.1B | 924.72M | 840.8M | 696.8M | 608.3M | 515.2M | 454.7M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 57.1M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 10.80 | 9.98 | 9.10 | 8.21 | 7.00 | 6.07 | 5.70 | 5.24 | 4.25 | 3.85 | 3.25 | 2.89 | 3.12 | 2.81 | 2.82 | 2.52 | 2.40 | 2.63 | 2.20 | 2.01 | 1.45 | 1.79 | 1.18 | 1.34 | 1.75 | 1.44 | 1.31 | 1.10 | 0.98 | 0.85 | 0.77 |
| EPS Growth % | 9.71% | 9.67% | 10.84% | 17.29% | 15.32% | 6.49% | 8.78% | 23.29% | 10.39% | 18.5% | 12.5% | -7.32% | 10.87% | -0.33% | 11.9% | 4.83% | -8.45% | 19.17% | 9.87% | 38.32% | -18.99% | 51.69% | -11.94% | -23.43% | 21.53% | 9.92% | 19.09% | 12.24% | 15.29% | 10.39% | 11.59% |
| EPS (Basic) | - | 10.02 | 9.14 | 8.25 | 7.04 | 6.10 | 5.73 | 5.27 | 4.28 | 3.87 | 3.26 | 2.91 | 3.14 | 2.84 | 2.85 | 2.54 | 2.42 | 2.64 | 2.23 | 2.03 | 1.46 | 1.81 | 1.19 | 1.36 | 1.78 | 1.47 | 1.34 | 1.13 | 1.01 | 0.88 | 0.79 |
| Diluted Shares Outstanding | 402.3M | 408.7M | 412.2M | 415.7M | 421.1M | 428.1M | 432.7M | 437.6M | 443.3M | 450.3M | 459.1M | 475.8M | 483.1M | 487.1M | 492.2M | 498.3M | 503.7M | 505.8M | 527.2M | 557.9M | 580.3M | 590M | 598.7M | 605.9M | 630.58M | 645.99M | 646.1M | 636.89M | 628.2M | 606.12M | 590.52M |
| Basic Shares Outstanding | 401.1M | 407.1M | 410.6M | 413.7M | 418.8M | 426.3M | 430.8M | 435M | 440.6M | 447.8M | 457M | 472.6M | 478.9M | 482.7M | 487.3M | 493.5M | 500.5M | 503.2M | 521.5M | 549.7M | 574.8M | 583.2M | 591.7M | 600.1M | 618.86M | 629.03M | 626.77M | 615.63M | 600.8M | 585.45M | 575.57M |
| Dividend Payout Ratio | - | 58.8% | 58.18% | 55.79% | 56.26% | 60.63% | 59.62% | 56.39% | 65.63% | 57.41% | 63.22% | 63.86% | 58.26% | 57.3% | 53.27% | 55.21% | 55.59% | 47.23% | 44.42% | 40.51% | 25.35% | 32.68% | 32.99% | 27.95% | 25.15% | 26.87% | 25.28% | 25.99% | 25.26% | 25.28% | 24.65% |
Legacy platform migration friction
According to the provided quarterly income statements, ADP has maintained a steady revenue growth trajectory, with the most recent period reaching $5.9 billion, representing a 7.0% year-over-year increase, which suggests that the company's core payroll and HCM services remain resilient despite broader macroeconomic uncertainty.
The consistent mid-single-digit growth appears to be driven by a combination of recurring service fees and the inherent stickiness of the company's compliance-heavy business model. Investors should monitor whether this growth rate can be sustained as the company attempts to migrate legacy clients to its newer, more automated platforms.
As reported in the financial data, ADP's gross margin has fluctuated between 45.2% and 51.7% over the last ten quarters, reflecting the dilutive impact of the PEO segment's pass-through costs on the company's overall profitability profile compared to pure-play software competitors.
The variability in gross margins suggests that the mix between high-margin software subscriptions and lower-margin PEO services is a primary driver of profitability. Analysts should investigate whether the recent compression in gross margins is a result of rising service delivery costs or a shift in the underlying client mix.
Based on the provided income statement figures, ADP's operating margin has shown significant volatility, ranging from a negative 2.4% in 2026Q1 to a peak of 30.1% in 2026Q3, indicating that the company's cost structure is not yet fully optimized for consistent operating leverage.
The sharp swings in operating income suggest that the company's fixed-cost base, particularly regarding service personnel and technology maintenance, remains a significant burden during periods of investment. This inconsistency warrants further investigation into whether management can successfully decouple revenue growth from the current high-touch service requirements.
Data from the latest filings indicate that SG&A expenses have remained relatively contained, hovering near $1.1 billion in recent quarters, which suggests that management is exercising disciplined control over overhead costs while simultaneously funding the transition to next-generation HCM platforms.
The ability to maintain SG&A efficiency while navigating a complex technological transition is critical for preserving bottom-line performance. Investors should monitor whether the current level of R&D and SG&A spending is sufficient to defend against nimbler, cloud-native competitors that do not carry the same legacy cost burdens.
While ADP maintains a strong market position, the income statement data reveals that the company's reliance on human-intensive service models may be a vulnerability, as evidenced by the 2026Q1 operating loss which highlights the potential for margin compression during periods of strategic investment.
Short-sellers might focus on the potential for cloud-native competitors to erode ADP's market share by offering lower-cost, automated alternatives that bypass the need for expensive, human-led compliance support. The company's ability to maintain its premium valuation may depend on its success in proving that its service-heavy moat remains relevant in an increasingly AI-driven landscape.
Quick answers to the most common questions about buying ADP stock.
For fiscal year 2025, Automatic Data Processing, Inc. (ADP) reported total revenue of $20.56B. This represents a 476.5% increase compared to $3.57B in 1996.
Automatic Data Processing, Inc. (ADP) is profitable, generating $4.08B in net income for the fiscal year ending 2025 with a net profit margin of 19.8%.
Automatic Data Processing, Inc. (ADP) reported an operating income of $5.41B, resulting in an operating profit margin of 26.3%. This margin reflects the operational efficiency of the business before interest and taxes.
Automatic Data Processing, Inc. (ADP) generated $10.45B in gross profit for the year, representing a gross profit margin of 50.8%. This demonstrates the company's core pricing power and production efficiency.