Paychex Inc. reported fourth-quarter results that slightly outperformed earnings expectations while meeting revenue forecasts, but the stock declined following the release.
For the quarter ended May 31, 2026, the HR and payroll services provider posted adjusted earnings per share of $1.32, compared with the analyst consensus of $1.31. Revenue for the period came in at $1.61 billion, matching estimates and representing 12% growth from $1.43 billion in the same quarter a year earlier. The company said the results reflected a full quarter of revenue from Paycor HCM, which Paychex acquired in April 2025, versus only a partial quarter in the prior-year period.
Following the quarterly report, shares declined about 4%.
Looking ahead, Paychex issued guidance for fiscal 2027 calling for total revenue growth of 5% to 6%. The company noted the midpoint of that range, 5.5%, is below the pace implied by the 12% growth delivered in the fourth quarter.
Paychex also projected adjusted diluted earnings per share growth of 7% to 9% for fiscal 2027, which the company said would equate to a range of $5.90 to $6.01, based on fiscal 2026's adjusted EPS of $5.51.
"We finished fiscal 2026 with strong momentum, delivering double-digit revenue and earnings growth while accelerating organic revenue growth throughout the year," stated John Gibson, President and Chief Executive Officer.
Segment results provided additional detail on the drivers of the quarter. Management Solutions revenue rose 14% to $1.2 billion, with Paycor contributing roughly 8 percentage points of that increase. PEO and Insurance Solutions revenue increased 9% to $369.7 million, supported by growth in average PEO worksite employees.
On the profitability side, operating income rose 40% to $604.7 million, while adjusted operating income grew 17% to $675.8 million.
For the full fiscal year 2026, Paychex reported adjusted diluted earnings per share of $5.51, an 11% increase from $4.98 in fiscal 2025. During the year the company returned $2.2 billion to shareholders through dividends and share repurchases.
The results combine a narrow earnings beat and revenue in line with expectations with a fiscal 2027 revenue trajectory that is notably below the company’s most recent quarterly growth rate. Investors reacted to the outlook by selling the stock, producing the reported decline in the share price after the announcement.