Paychex Reports $5.57 Billion Revenue for Fiscal Year 2025, Acquires Paycor HCM

Paychex, Inc. reported a total revenue of $5.57 billion for the fiscal year ending May 31, 2025, marking a 6% increase from $5.28 billion in the previous fiscal year. The company's operating income rose to $2.21 billion, a 2% increase from $2.17 billion in fiscal 2024. However, net income decreased slightly to $1.66 billion, down from $1.69 billion in the prior year, resulting in diluted earnings per share of $4.58, compared to $4.67 in fiscal 2024. The company also paid dividends totaling $1.45 billion, representing approximately 87% of net income for the year.

Significant changes in financial performance were influenced by the acquisition of Paycor HCM, Inc. on April 14, 2025, for approximately $4.1 billion, which was financed through the issuance of $4.2 billion in corporate bonds. This acquisition is expected to enhance Paychex's capabilities in the upmarket segment and expand its suite of AI-driven human capital management solutions. The integration of Paycor is anticipated to drive future growth, although it has also contributed to increased operating expenses, including $162.3 million in acquisition-related costs.

Operationally, Paychex served approximately 800,000 clients as of May 31, 2025, an increase from 745,000 clients the previous year. Client retention rates remained stable, ranging from 82% to 83%. The company reported a 5% increase in worksite employees under its professional employer organization (PEO) solutions, totaling 2.46 million, and a 3% increase in retirement solutions plans to 124,000. The asset value of retirement solutions participants’ funds also grew by 8% to $55.7 billion.

The company continues to focus on technology investments, enhancing its Paychex Flex, Paycor, and SurePayroll platforms to improve client experiences. Paychex is also leveraging AI and advanced analytics to better understand client needs and preferences. The company’s strategy includes expanding its market share in integrated solutions beyond payroll processing, particularly in HR outsourcing and retirement solutions. Looking ahead, Paychex anticipates continued growth driven by its strategic initiatives and the integration of Paycor, while maintaining a strong financial position with cash and investments totaling $1.7 billion as of May 31, 2025.