Company: ADP
Filing Date: 2025-01-30
Form Type: 10-Q
Source: 0000008670-25-000007
Chunk: 118

Company: AUTOMATIC DATA PROCESSING INC
Filing Date: 2025-01-30
Form: 10-Q
Item: Part I, Item 8
Chunk 118
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31, 2024, respectively, due to contributions from client funds interest revenues discussed above, and operating efficiencies for costs of servicing our clients on growing revenue, partially offset by acquisition related expenses.

PEO Services

Revenues

PEO RevenuesThree Months EndedChangeSix Months EndedChangeDecember 31,December 31, 20242023$%20242023$%PEO Services' revenues$1,663.3 $1,546.1 $117.2 8 %$3,237.8 $3,015.7 $222.1 7 %Less: PEO zero-margin benefits pass-throughs1,055.2 970.7 84.5 9 %2,104.4 1,947.5 156.9 8 %PEO Services' revenues excluding zero-margin benefits pass-throughs$608.1 $575.4 $32.7 6 %$1,133.4 $1,068.2 $65.2 6 %

PEO Services' revenue increased for the three and six months ended December 31, 2024, due to the increase in zero-margin benefits pass-throughs, and an increase in average worksite employees of 3% for each period, as compared to the three and six months ended December 31, 2023.

Earnings before Income Taxes

PEO Services' earnings before income taxes decreased 1% and remained flat for the three and six months ended December 31, 2024, respectively, due to increased revenues discussed above, partially offset by increases in zero-margin benefits pass-through costs, operating costs related to workers' compensation and state unemployment insurance, and selling expenses, as compared to the three and six months ended December 31, 2023.

Margin 

PEO Services' margin decreased for the three and six months ended December 31, 2024 due to increases in zero-margin benefits pass-through costs, operating costs related to workers' compensation and state unemployment insurance, and selling expenses.

ADP Indemnity provides workers’ compensation and employer’s liability deductible reimbursement insurance protection for PEO Services’ worksite employees up to $1 million per occurrence. PEO Services has secured a workers’ compensation and employer’s liability insurance policy that caps the exposure for each claim at $1 million per occurrence and has also secured  aggregate stop loss insurance that caps aggregate losses at a certain level in fiscal years