ADP · 8-K · 20261028PR000033

Margin Drivers

AUTOMATIC DATA PROCESSING INC · 2026-10-28 · Importance 23 · Surprise 22

Adjusted EBIT rose 12% year over year to $1.470 billion in the first quarter of fiscal 2027. Adjusted EBIT margin expanded 130 basis points to 26.8%, from 25.5%. Employer Services segment margin increased 130 basis points to 36.5%, while PEO Services margin remained flat at 13.0%.

Key facts

• For the three months ended September 30, 2026, ADP net earnings increased 11% to $1.1 billion and adjusted net earnings increased 11% to $1.1 billion. source
• For the three months ended September 30, 2026, ADP adjusted EBIT increased 12% to $1.5 billion, and adjusted EBIT margin increased 130 basis points to 26.8%. source
• For the three months ended September 30, 2026, ADP diluted EPS increased 14% to $2.83 and adjusted diluted EPS increased 13% to $2.82. source
• For the first quarter of fiscal 2027, ADP Employer Services segment margin increased 130 basis points. source
• For the first quarter of fiscal 2027, ADP PEO Services segment margin was flat. source
• ADP's effective tax rate for the quarter was 22.7% on both a reported basis and an adjusted basis. source