Company: PAYX
Filing Date: 2025-03-26
Form Type: 10-Q
Source: 0000950170-25-045216
Chunk: 11

Company: PAYCHEX INC
Filing Date: 2025-03-26
Form: 10-Q
Item: Part I, Item 2
Chunk 11
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 %

    Diluted earnings per share
     
    $
     
    1.43

    $
     
    1.38

    4
     
    %
     
    $
     
    3.76

    $
     
    3.62

    4
     
    %

(1)  Percentage changes are calculated based on unrounded numbers.

n/m — not meaningful

22 

Total revenue increased to $1.5 billion for the third quarter and $4.1 billion for the nine months, reflecting increases of 5% and 4% respectively, compared to the prior year periods. Excluding the impact of the expiration of the Employee Retention Tax Credit ("ERTC") program, revenue growth for both the third quarter and the nine months was 6%. The changes in revenue as compared to the prior year periods were primarily driven by the following factors: 

•Management Solutions revenue: $1.1 billion for the third quarter and $3.0 billion for the nine months, reflecting increases of 5% and 3%, respectively:

oContinued growth in the number of clients served across our suite of HCM solutions and client worksite employees for HR solutions; 

oHigher revenue per client resulting from price realization and product penetration, including HR solutions and retirement; and

oLower revenue from ancillary services, primarily due to the expiration of our ERTC program during the three-month period ended February 29, 2024.

•PEO and Insurance Solutions revenue: $365.4 million for the third quarter and $1.0 billion for the nine months, reflecting increases of 6% and 7%, respectively:

oGrowth in the number of average PEO worksite employees; and

oIncrease in PEO insurance revenues.

•Interest on funds held for clients: $42.9 million for the third quarter reflecting a decrease of 2%, primarily due to lower average interest rates. $116.5 million for the nine months, reflecting an increase of 8%, primarily due to higher average interest rates and average investment balances.

We invest in highly liquid, investment-grade fixed income securities. Details regarding our combined funds held for clients and corporate cash equivalents and investment portfolios were as follows:

    For the three months ended

    For the nine months ended

    February 28,
     
    February 29,

    February 28,
     
    February 29,

    $ in millions
     
    2025