Abstract

Paycom will report fourth-quarter results on February 11, 2026 Post Market, with investors watching revenue, profitability, and adjusted EPS amid product adoption trends and client retention dynamics.

Market Forecast

Consensus derived from the company’s latest guidance framework points to fourth-quarter revenue of USD 543.01 million, adjusted EPS of USD 2.44, and EBIT of USD 180.69 million, implying year-over-year growth of 12.94%, 23.81%, and 22.12%, respectively. The gross margin outlook is consistent with recent levels, while projected net profit growth and margin resilience suggest a modest operating leverage improvement versus the prior year. The main business is expected to be led by subscription-based “recurring and other” revenue, with steady client additions and retention shaping near-term trends. The most promising segment remains recurring and other, which is projected to contribute a majority of revenue; last quarter it delivered USD 466.50 million, reflecting stable expansion.

Last Quarter Review

Paycom’s prior quarter delivered revenue of USD 493.30 million, a gross profit margin of 87.01%, GAAP net profit attributable to the parent company of USD 111.00 million, a net profit margin of 22.44%, and adjusted EPS of USD 1.94, with year-over-year growth of 9.15% for revenue and 16.17% for adjusted EPS. A key highlight was improved operating efficiency supported by product usage and cost discipline, translating into positive net profit growth of 23.69% quarter-on-quarter. The main business portfolio was dominated by recurring and other at USD 466.50 million, while interest revenue contributed USD 26.80 million; recurring and other showed stable YoY growth aligned with overall revenue dynamics.

Current Quarter Outlook

Main Business: Recurring and Other

Recurring and other revenue underpins Paycom’s financial model, representing the bulk of topline and driven by seat-based subscriptions across payroll, HR, and talent modules. The quarter’s growth expectation is tied to client expansion and retention, supported by cross-sell across platform modules and sustained usage from existing customers. Pricing discipline and normalized churn are essential to maintaining revenue momentum; management’s prior trajectory suggests mid-to-high single-digit to low double-digit growth in recurring streams, consistent with the 12.94% total revenue forecast. Operating leverage should benefit from high gross margins of 87.01%, enabling continued reinvestment in product and client success while supporting EBIT and EPS growth. One area to watch is the onboarding cadence of new logos versus upsell into the installed base, which together influence quarterly bookings and pipeline conversion.

Most Promising Business: Core Platform Adoption and Module Penetration

The company’s largest growth potential remains deeper adoption of its core unified platform, with module penetration expanding average revenue per client over time. With forecast revenue growth of 12.94% and EBIT growth of 22.12%, the model implies improved utilization and mix toward higher-value features that can lift margin. A consistent gross margin profile and steady net margin reflect the efficiency of the platform once modules are activated at scale, creating visibility for earnings. Leveraging analytics, automated workflows, and compliance capabilities can unlock incremental demand within existing accounts, which is often less sensitive to broader macro uncertainty compared with pure new customer acquisition. The reported stability in interest revenue underscores limited dependence on non-operating income for growth, emphasizing the subscription core as the key engine this quarter.

Stock Price Drivers This Quarter

Three elements are likely to exert the greatest influence on Paycom’s stock around the print. First, the spread between reported revenue and the USD 543.01 million projection will set the tone; outperformance relative to the 12.94% YoY expectation could recalibrate EPS assumptions beyond the USD 2.44 forecast. Second, gross margin stability and any commentary on cost structure will guide views on operating leverage; maintaining levels around 87.01% supports the 22.12% EBIT growth forecast and provides confidence in margin durability. Third, management’s color on client retention, sales productivity, and module attach rates will shape perceptions of sustainable growth. Investors will also parse guidance for the subsequent quarter to test whether the observed net profit resilience and 23.81% EPS growth profile carry forward.

Analyst Opinions

The prevailing view is cautiously constructive, with a majority of analysts highlighting balanced upside tied to margin stability and subscription durability while noting sensitivity to sales execution. Notable institutional commentary points to the earnings setup characterized by high gross margins and improving EBIT mix, with expectations centered on an adjusted EPS near USD 2.44 and revenue near USD 543.01 million. The consensus tilt reflects optimism that recurring and other will continue to anchor performance, bolstered by modest operating leverage, though the stock reaction will depend on guidance and qualitative indicators around retention and module adoption. Overall, the majority perspective anticipates in-line to modestly better results, supported by efficiency gains and a contained cost base, while remaining attentive to signals on demand pacing into the next fiscal period.