Paylocity (PCTY) investor relations material

Executive summary

• Q3 2026 recurring and other revenue reached $469.9 million, up 11.6% year-over-year, with total revenue at $502.3 million, driven by strong sales, product innovation, and expanded AI capabilities.

• Net income for Q3 2026 was $111.3 million ($2.05 per share), up from $91.5 million ($1.61 per share) in Q3 2025.

• Acquired Grayscale Labs in April 2026 to enhance AI-powered recruiting automation and completed the acquisition of Airbase Inc. in October 2024 to expand spend management capabilities.

• Launched Paylocity Elevate Solutions, expanding managed service offerings for payroll and HR.

• Board approved a $1.0 billion increase in share repurchase authorization, totaling $1.35 billion available as of May 2026, with $350 million in share repurchases completed in the first nine months.

Financial highlights

• Adjusted EBITDA for Q3 2026 was $220.2 million (43.8% margin), up from $197.1 million in Q3 2025, and adjusted EBITDA excluding interest income was $187.9 million.

• Free cash flow for the trailing twelve months ended March 31, 2026 was $421.0 million (24.4% margin), up from $335.8 million (21.6%) a year earlier.

• GAAP operating income for Q3 2026 was $157.0 million; non-GAAP operating income was $196.8 million.

• Cash and cash equivalents totaled $299.7 million as of March 31, 2026, with $81.3 million in long-term debt.

• Net cash provided by operating activities for the first nine months of fiscal 2026 was $421.4 million, up from $331.7 million in the prior year period.

Outlook and guidance

• Fiscal 2026 recurring and other revenue expected between $1.638 billion and $1.643 billion (11–12% growth year-over-year); total revenue expected between $1.755 billion and $1.760 billion (10% growth year-over-year).

• Fiscal 2026 adjusted EBITDA expected between $638.0 million and $642.0 million.

• Q4 2026 recurring and other revenue expected between $402.2 million and $407.2 million (9–10% growth year-over-year); total revenue expected between $428.4 million and $433.4 million.

• Guidance assumes flat workforce levels and no further Fed rate cuts.

• Management expects continued investment in R&D, sales, and client service to drive long-term growth and operating leverage.