Dayforce (DAY) UBS Global Technology Conference summary

Company transformation and technology

• Underwent significant transformation since merging Dayforce and Ceridian in 2012, focusing on integrating payroll and workforce management into a single application.

• Expanded globally, now offering native payroll in the US, Canada, UK, Ireland, Germany, Australia, New Zealand, Singapore, and more.

• Shifted from on-premise to cloud, with cloud now representing 85% of revenue, up from 25% in 2018.

• Unique continuous calculation technology enables real-time payroll and the Dayforce Wallet, allowing employees to access earned wages instantly.

• Dayforce Wallet revenue grew from $12 million last year to over $30 million this year, highlighting product differentiation.

Market positioning and growth strategy

• Competes in major markets (500–3,500 employees) with a full HCM suite, replacing an average of 12 solutions per client.

• In large enterprise segments, starts with compliance modules and expands relationships over time.

• Main competitors include UKG, Workday, ADP, SAP, and Oracle.

• Total addressable market (TAM) per employee per month has increased from $12 to $48, driven by product and global expansion.

• Focused on cross-selling and upselling to existing customers, with add-on sales rising from 30% to 40% of total sales year-over-year.

Financial performance and guidance

• 2025 guidance includes 14–15% revenue growth (constant currency, excluding float), Adjusted EBITDA margin above 31%, and free cash flow margin above 12%.

• Cloud recurring gross margin nearing 80%, with managed services margin in the low 70s%.

• Managed services now a focus due to improved margins, providing a boost to revenue and cross-sell opportunities.

• Professional services expected to grow slightly slower than recurring services, with a goal to reach breakeven gross margin.

• Free cash flow margin expected to expand by 100–200 basis points annually.