Company: ADP
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0000008670-25-000047
Chunk: 4

Company: AUTOMATIC DATA PROCESSING INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 2
Chunk 4
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 an increase in average reverse repurchase outstanding balances of $0.7 billion, as compared to the three months ended September 30, 2024. This decrease was partially offset by net increases in interest expense of $12.7 million related to the senior notes issued and redeemed during the year ended June 30, 2025.

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Other (Income)/Expense, net

Three Months EndedSeptember 30,20252024$ ChangeInterest income on corporate funds$(101.5)$(91.7)$9.8 Realized (gains)/losses on available-for-sale securities, net(1.5)0.2 1.7 Gain on sale of assets— (2.4)(2.4)Non-service components of pension income, net(7.1)(7.8)(0.7)Other income, net$(110.1)$(101.7)$8.4 

Interest income on corporate funds increased for the three months ended September 30, 2025 due to higher average investment balances of $11.4 billion as compared to $10.7 billion for the three months ended September 30, 2024, coupled with an increase in average interest rates of 20 basis points, as compared to the three months ended September 30, 2024. 

See Note 12 of our Consolidated Financial Statements for further details on non-service components of pension income, net. 

Earnings Before Income Taxes ("EBIT") and Adjusted EBIT 

Three Months EndedSeptember 30,20252024YoY GrowthEBIT$1,307.5 $1,236.2 6 %  EBIT Margin25.3 %25.6 %(30) bpsAdjusted EBIT$1,318.3 $1,232.5 7 %  Adjusted EBIT Margin25.5 %25.5 %0 bps

Earnings before income taxes increased for the three months ended September 30, 2025, due to the increase in total revenues, partially offset by the increase in total expenses discussed above.

EBIT Margin decreased for the three months ended September 30, 2025, due to increased selling and marketing expenses and costs of servicing and implementing our clients on growing revenue, partially offset by contributions from client fund interest revenues discussed above and interest expense.

Adjusted EBIT and Adjusted EBIT margin exclude interest income and interest expense that are not