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Copyright © 2025 ADP, Inc. ADP Earnings Call & Webcast Q1 Fiscal 2026 October 29, 2025
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2Copyright © 2025 ADP, Inc. DISCLAIMERS FORWARD-LOOKING STATEMENTS This document and other written or oral statements made from time to time by ADP may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical in nature and which may be identified by the use of words like “outlook,” “expects,”“assumes,” “projects,” “anticipates,” “estimates,” “we believe,” “could,” “is designed to” and other words of similar meaning, are forward-looking statements. These statements are based on management’s expectations and assumptions and depend upon or refer to future events or conditions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed. Factors that could cause actual results to differ materially from those contemplated by the forward-looking statements or that could contribute to such difference include: ADP's success in obtaining and retaining clients, and selling additional services to clients; the pricing of products and services; the success of our new solutions; our ability to respond successfully to changes in technology, including artificial intelligence; compliance with existing or new legislation or regulations; changes in, or interpretations of, existing legislation or regulations; overall market, political and economic conditions, including interest rate and foreign currency trends and inflation; competitive conditions; our ability to maintain our current credit ratings and the impact on our funding costs and profitability; security or cyber breaches, fraudulent acts, and system interruptions and failures; employment and wage levels; availability of skilled associates; the impact of new acquisitions and divestitures; the impact of any uncertainties related to major natural disasters or catastrophic events; and supply-chain disruptions. ADP disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. These risks and uncertainties, along with the risk factors discussed under “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K, and in other written or oral statements made from time to time by ADP, should be considered in evaluating any forward-looking statements contained herein. Adjusted EBIT, adjusted EBIT margin, adjusted diluted earnings per share, adjusted effective tax rate, and organic constant currency are all non-GAAP financial measures. Please refer to the Q1 fiscal 2026 earnings release available at investors.adp.com for a discussion of why ADP believes these measures are important and for a reconciliation of non-GAAP financial measures to their closest comparable GAAP financial measures. This presentation is a supplement to our Q1 fiscal 2026 earnings release; it is intended to be read in conjunction with, not as a substitute for, or in isolation from, the earnings release. NON-GAAP MEASURES
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3 Copyright © 2025 ADP, Inc. HIGHLIGHTS AND PERSPECTIVES SOLID Q1 FINANCIAL AND OPERATING PERFORMANCE: • 7% revenue growth and 7% adjusted diluted EPS1 growth • Record Q1 ES new business bookings volume • Better-than-expected ES retention • Company-wide client satisfaction scores reached new all-time high for a Q1 STRATEGIC PROGRESS: • Scaled ADP Embedded Payroll for small businesses and added benefits selection functionality to RUN platform • Accelerated Workforce Now Next-Gen deployment in mid-market • Continued enterprise sales momentum for ADP Lyric HCM • Acquired Pequity, an innovative compensation management software provider • Advanced AI in-product and internal initiatives • Enhanced global capabilities with expanded reach 1. For a reconciliation of these non-GAAP financial metrics to their closest comparable GAAP metrics see our Q1 fiscal 2026 earnings release available at investors.adp.com. 3
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4 Copyright © 2025 ADP, Inc. Q1 FISCAL 2026 FINANCIAL HIGHLIGHTS (Unaudited) 1. For a reconciliation of these non-GAAP financial metrics to their closest comparable GAAP metrics see our Q1 fiscal 2026 earnings release available at investors.adp.com. Q1 FY25 Q1 FY26 Q1 FY25 Q1 FY26Q1 FY25 Q1 FY26 $4,833M $5,175M $1,233M $1,318M $2.33 $2.49 TOTAL REVENUES 7% 6% Organic Constant Currency 1 ADJUSTED EBIT1 7% Adjusted EBIT 1 Margin Flat ADJUSTED DILUTED EPS1 7%
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5 Copyright © 2025 ADP, Inc. Q1 FISCAL 2026 EMPLOYER SERVICES SEGMENT RESULTS 1. For a reconciliation of these non-GAAP financial metrics to their closest comparable GAAP metrics see our Q1 fiscal 2026 earnings release available at investors.adp.com. Q1 FY25 Q1 FY26Q1 FY25 Q1 FY26 Q1 ES HIGHLIGHTS • Strong revenue growth supported by solid new business bookings, retention and continued client funds interest revenue growth $3,261M $3,491M • U.S. pays per control approximately flat • Average client funds balances 7% • Average client funds yield of 3.3%, up from 3.1% in prior year 35.7% 35.2% • Margin decline reflected integration and acquisition-related expenses associated with WorkForce Software ES REVENUES 7% 5% Organic Constant Currency 1 ES MARGIN 50 bps (Unaudited) FY26 ES OUTLOOK July 30, 2025 October 29, 2025 Revenues 5 to 6% 5 to 6% ES New Business Bookings 4 to 7% 4 to 7% Client Revenue Retention (30) to (10) bps (30) to (10) bps U. S. Pays Per Control 0 to 1% ~Flat
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6 Copyright © 2025 ADP, Inc. Q1 FISCAL 2026 PEO SERVICES SEGMENT RESULTS • Revenues excluding zero-margin benefits pass-throughs (ZMPT) 6% • Average worksite employees (WSEs) 2% to 754,000 • Margin decline driven mainly by higher selling expenses, the timing of SUI costs, zero-margin benefits pass-through revenue growth, and one-time costs connected with the retroactive change in the deadline for filing certain ERTC claims Q1 FY25 Q1 FY26Q1 FY25 Q1 FY26 PEO REVENUES 7% PEO MARGIN 140 bps Q1 PEO HIGHLIGHTS • Strong revenue helped by growth in zero- margin pass-throughs and higher wages • PEO pays per growth control moderated $1,575M $1,688M 14.3% 13.0% (Unaudited) FY26 PEO OUTLOOK July 30, 2025 October 29, 2025 Revenues 5 to 7% 5 to 7% Revenues Ex ZMPT 3 to 5% 3 to 5% Average WSEs 2 to 3% 2 to 3%
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7 Copyright © 2025 ADP, Inc. FISCAL 2026 OUTLOOK 1. Outlook contemplates the anticipated impact of foreign currency in revenue and operating results. 2. For a reconciliation of these non-GAAP financial metrics to their closest comparable GAAP metrics see our Q1 fiscal 2026 earnings release available at investors.adp.com. Fiscal 2025 (unaudited) July 30, 2025 Fiscal 2026 Outlook 1 October 29, 2025 Fiscal 2026 Outlook 1 Total ADP Revenues $20,561M 5 to 6% 5 to 6% Adj. EBIT Margin 2 26.0% 50 to 70 bps 50 to 70 bps Adj. Effective Tax Rate 2 23.2% ~23% ~23% Adj. Diluted EPS 2 $10.01 8 to 10% 8 to 10% Employer Services Revenues $13,883M 5 to 6% 5 to 6% ES New Business Bookings $2.1B 4 to 7% 4 to 7% Client Revenue Retention 92.1% (30) to (10) bps (30) to (10) bps U.S. Pays Per Control 1% 0 to 1% ~Flat PEO Services Revenues $6,690M 5 to 7% 5 to 7% Revenues Ex Zero-Margin Pass-throughs $2,401M 3 to 5% 3 to 5% Average WSEs 748,000 2 to 3% 2 to 3% Client Funds Interest Average Client Funds Balances $37.6B 2 to 3% 3 to 4% Yield on Client Funds Portfolio 3.2% ~3.4% ~3.4% Client Funds Interest Revenue $1,189M $1,290 to $1,310M $1,300 to $1,320M Net Impact from Client Funds Extended Strategy $1,073M $1,250 to $1,270M $1,260 to $1,280M
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8 Copyright © 2025 ADP, Inc. APPENDIX: CLIENT FUNDS INVESTMENT STRATEGY DETAIL Interest on the Extended Portfolio flows into two separate sections of the Statements of Consolidated Earnings. 1. Reported as Interest on Funds Held for Clients in the revenue section of the Statements of Consolidated Earnings. 2. A component of Interest Income on Corporate Funds, reported within Other Income, net, on the Statements of Consolidated Earni ngs. Average Balances ($) Average Rates Interest Income / (Expense) ($) Fiscal 2025 (unaudited) October 29, 2025 Fiscal 2026 Outlook 1 Fiscal 2025 (unaudited) October 29, 2025 Fiscal 2026 Outlook 1 Fiscal 2025 (unaudited) October 29, 2025 Fiscal 2026 Outlook 1 Client Short 8.5B 8.3 – 8.4B 4.2% ~3.4% 355M 280 – 285M Client Extended 15.5B 16.1 – 16.3B 2.7% ~3.5% 411M 555 – 565M Client Long 13.6B 14.3 – 14.5B 3.1% ~3.3% 423M 465 – 470M Funds Held for Clients 1 37.6B 38.7 – 39.2B 3.2% ~3.4% 1,189M 1,300 – 1,320M Corporate Extended Interest Income2 7.0B ~8.0B 3.2% ~3.5% 225M ~275M Short-term Financing to Support Client Funds Extended Strategy 7.0B ~8.0B 4.8% ~3.9% (341)M ~(315)M Net Impact from Client Funds Extended Strategy 1,073M 1,260 – 1,280M