Q4 2024 Automatic Data Processing Inc Earnings Call

Maria Black: This represents another great year for ADP. I'm excited to share the progress we've made across our three strategic priorities, but first, I'll start off with some additional highlights from our results. Our sales and marketing team delivered exceptional employer services, new business bookings, and Q4 on top of a strong Q4 last year. This performance was broad-based, showing continued strength in our small business portfolio, as well as our mid market, enterprise, and international business. In fact, we sold and started more than 50,000 new small business clients during the quarter, which not only reflects the strength of our run solution, but also our reputation for commitment to strong service.

Maria Black: Representing another great year for ADP. I'm excited to share the progress we've made across our three strategic priorities, but first I'll start off with some additional highlights from our results. Our sales and marketing teams delivered exceptional employer services, new business bookings, and Q4 on top of a strong Q4 last year. This performance was broad based, showing continued strength in our small business portfolio, as well as our mid market enterprise and international businesses. In fact, we sold and started more than 50,000 new small business clients during the quarter, which not only reflects the strength of our run solution, but also our reputation for commitment to strong service.

And last year.

Speaker Change: This performance was broad based showing continued strength in our small business portfolio as well as our mid market enterprise and international businesses.

Speaker Change: In fact, we sold and started more than 50000, new small business clients during the quarter, which not only reflects the strength of our run solution, but also our reputation for our commitment to strong service <unk>.

Maria Black: Similarly, in the enterprise base, client interest in our next gen HCM solution has exceeded expectations and resulted in strong Q4 sales, and we are excited to continue this great momentum. As a result of this exceptional performance, our fiscal 2024 employer services bookings growth came in at 7%, the high end of our four to 7% guidance range. This growth speaks to the power of ADP's unmatched distribution model, which remains a clear competitive advantage for us. With our new business pipeline even stronger than this time last year, we look forward to building on that momentum. Overall, our employer services retention came in better than expected for the year at 92%.

Maria Black: Similarly, in the enterprise space, client interest in our next-gen HCM solution exceeded expectations and resulted in strong Q4 sales, and we are excited to continue this great momentum. As a result of this exceptional performance, our fiscal 2024 employer services bookings growth came in at 7%, the high end of our 4 to 7% guidance range. This growth speaks to the power of ADP's unmatched distribution model, which remains a clear competitive advantage for us.

Speaker Change: Similarly in the enterprise space client interest in our next Gen. HCM solution has exceeded expectations and resulted in strong Q4 sales and we are excited to continue this great momentum.

Speaker Change: As a result of this exceptional performance our fiscal 2020 for employer services bookings growth came in at 7% the high end of our 4% to 7% guidance range.

Speaker Change: This growth speaks to the power of Adp's unmatched distribution model, which remains a clear competitive advantage for us.

Maria Black: With our new business pipeline even stronger than this time last year, we look forward to building on that momentum. Overall, our employer services retention came in better than expected for the year at 92%. We drove record-level retention in our mid market business for the second consecutive year in fiscal 2024.

Speaker Change: With our new business pipeline, even stronger than this time last year, we look forward to building on that momentum.

Speaker Change: Overall, our employer services retention came in better than expected for the year at 92%, we drove record level retention in our mid market business for the second consecutive year in fiscal 2024.

Maria Black: We drove record level retention in our mid market business for the second consecutive year in fiscal 2024. I'm also extremely proud to share that our client satisfaction scores for our total business, which new all time highs for both the fourth quarter and full year. These results are a testament to the strength of our entire product portfolio and our commitment to supporting our clients. We are confident that these client satisfaction gains will support our retention results moving forward. Our employer services pace per control increased 2% both for the quarter and the full year. We were happy to have seen the resilience of the US labor market as our clients continued to hire employees at a moderate pace.

Maria Black: I'm also extremely proud to share our client satisfaction scores for our total business, which new all-time highs for both the fourth quarter and full year. These results are a testament to the strength of our entire product portfolio and our commitment to supporting our clients. We are confident that these client satisfaction gains will support our retention results moving forward. Our employer services pace per control increased 2% both for the quarter and the full year.

Speaker Change: I'm also extremely proud to share that our client satisfaction scores for our total business reached new all time highs for both the fourth quarter and full year.

Speaker Change: These results are testament to the strength of our entire product portfolio and our commitment to supporting our clients.

Speaker Change: We are confident that these client satisfaction gains will support our retention results moving forward.

Maria Black: We were happy to have seen the resilience of the US labor market as our clients continued to hire employees at a moderate pace. Finally, our fourth quarter PEO revenue growth of 6% exceeded our expectations, despite continued pressure from slowing client hiring activity. Our fiscal 2024 accomplishments extend far beyond our strong financial results. One year ago, I laid the foundation for our three strategic priorities that will guide our future growth. Now I'd like to recap some of the great progress we have made in each of these areas.

Speaker Change: Our employer services pays per control increased 2% both for the quarter and the full year. We were happy to have seen the resilience of the U S labor market as our clients continued to hire employees at a moderate pace.

Maria Black: Finally, our fourth quarter PEO revenue growth of 6% exceeded our expectations, despite continued pressure from flowing client hiring activity.

Speaker Change: Our fourth quarter PEO revenue growth of 6% exceeded our expectations. Despite continued pressure from slowing client hiring activity.

Maria Black: Our fiscal 2024 accomplishments extend far beyond our strong financial results. One year ago, I laid the foundation for our three strategic priorities that will guide our future growth. Now, I'd like to recap some of the great progress we made in each of these areas.

Speaker Change: Our fiscal 2024 accomplishments extend far beyond our strong financial results one year ago I laid the foundation for our three strategic priorities that will guide our future growth now I would like to recap some of the great progress we made in each of these areas.

Maria Black: Our first priority is to lead with best-in-class HCM technology. We had a very busy year on this front as we launched ADP Assist, our cross-platform solution powered by generative AI that transforms client data into actionable insights. This isn't just another technical solution. It's an experience that combines ADP's deep data set and expertise to empower HR professionals, leaders, and employees. We deployed ADP Assist across several of our platforms, including Role, Run Workforce Now and Next Gen HCM with enhanced capabilities ranging from report creation to natural language search to initiating HR actions. These tools streamline daily tasks and are all powered by an easy to use search interface that is already receiving meaningful recognition in the field of generative AI.

Maria Black: Our first priority is to lead with best-in-class HCM technology. We had a very busy year on this front as we launched ADP Assist, our cross-platform solution powered by generative AI that transforms client data into actionable insights. This isn't just another technical solution. It's an experience that combines ADP's deep data set and expertise to empower HR professionals, leaders, and employees. We deployed ADP Assist across several of our platforms, including Role, Run, WorkforceNow, and NextGen HCM, with enhanced capabilities ranging from report creation to natural language search to initiating HR actions. These tools streamline daily tasks and are all powered by an easy-to-use search interface that is already receiving meaningful recognition in the field of generative AI.

Speaker Change: Our first priority is to lead with best in class HCM technology, we had a very busy year on this front as we launched ADP assessed our cross platform solution powered by generative AI that transforms client data into actionable insights.

Speaker Change: This isn't just another technical solution its an experience that combines adp's deep dataset and expertise to empower HR professionals leaders and employees we.

Speaker Change: We deployed ADP assessed across several of our platforms, including role run workforce now and next Gen HCM with enhanced capabilities ranging from report creation to natural language search to initiating HR actions.

Speaker Change: These tools streamline daily tasks and are all powered by an easy to use search interface that is already receiving meaningful recognition in the field of generative AI. We are very proud to share that ADP assist earned degenerative AI Innovation award in the 2020 for AI Breakthrough Awards, and we look forward to rolling.

Maria Black: We are very proud to share that ADP Assist earned the Generative AI Innovation Award in the 2024 AI Breakthrough Awards, and we look forward to rolling out even more features in fiscal 2025. In addition to embedding generative AI and our products, we continued to advance our next gen initiative. Our active next gen payroll client count increased by nearly 50% in fiscal 2024, and we grew our number of live next gen HCM clients by more than 30% as we continued to improve implementation times.

Maria Black: We are very proud to share that ADP Assist earned the Generative AI Innovation Award at the 2024 AI Breakthrough Awards, and we look forward to rolling out even more features in fiscal 2025. In addition to embedding generative AI in our product, we continued to advance our next-gen initiatives. Our active NextGen payroll client count increased by nearly 50% in fiscal 2024, and we grew our number of live NextGen HCM clients by more than 30% as we continued to improve implementation times. Our next priority is to provide unmatched expertise and outsourcing.

Speaker Change: Out even more features in fiscal 2025.

Speaker Change: In addition to embedding generative AI in our products, we continued to advance our next gen initiatives.

Speaker Change: Our active next gen payroll client count increased by nearly 50% in fiscal 2024, and we grew our number of lives Nextgen HCM clients by more than 30% as we continued to improve implementation times.

Maria Black: Our next priority is to provide unmatched expertise and outsourcing. Our approach to supporting our clients has been key to our winning formula for decades. In the fiscal 2024, we focused our efforts on implementing new technology that will help make an even greater impact for our clients. To further unlock the value of our expertise, we deployed generative AI tools like call summarization and real-time guidance to support our service associates. We also invested in generative AI and other automation capabilities for our implementation teams to reduce manual data entry and minimize the risk of error during implementations. For example, out of the 50,000 new run clients we sold and started during the fourth quarter, about half were digitally onboarded compared to a third of our new client onboarding and run this time last year.

Speaker Change: Our next priority is to provide unmatched expertise in outsourcing our approach to supporting our clients has been key to our winning formula for decades and in fiscal 2024, we focused our efforts on implementing new technology that will help make an even greater impact for our clients.

Maria Black: Our approach to supporting our clients has been key to our winning formula for decades, and in fiscal 2024, we focused our efforts on implementing new technology that will help make an even greater impact for our clients. To further unlock the value of our expertise, we deployed generative AI tools like call summarization and real-time guidance to support our service associates. We also invested in generative AI and other automation capabilities for our implementation teams to reduce manual data entry and minimize the risk of error during implementation.

Speaker Change: To further unlock the value of our expertise, we deploy degenerative AI tools like call summarization, and real time guidance to support our service associates.

Speaker Change: We also invested in generative AI and other automation capabilities for our implementation teams to reduce manual data entry and minimize the risk of Ara. During implementations for example out of the 50000, new run clients, we sold and started during the fourth quarter about half were digitally on boarded.

Maria Black: For example, out of the 50,000 new RUN clients we sold and started during the fourth quarter, about half were digitally onboarded, compared to a third of our new client onboarding in RUN this time last year. And as generative AI capabilities advance, we're excited to further accelerate this progress.

Speaker Change: Compared to a third of our new client Onboarding and run this time last year.

Maria Black: And as generative AI capabilities advance, we're excited to further accelerate this progress. Finally, we plan to provide additional tools to help our associates deliver better, faster service and allow our client satisfaction scores to continue reaching new record levels.

Speaker Change: And as generative AI capabilities advance we're excited to further accelerate this progress.

Maria Black: Finally, we plan to provide additional tools to help our associates deliver better, faster service and allow our client satisfaction scores to continue reaching new record levels. Our third strategic priority is to benefit our clients through our global scale. Globally, we bring together an unmatched footprint, best in class, integrated solutions, and industry-leading service and expertise to help our clients and their employees navigate the changing world of work. In fiscal 2024, we continued to leverage this global scale to strengthen our business.

Speaker Change: Finally, we plan to provide additional tools to help our associates deliver better faster service and allow our client satisfaction scores to continue reaching new record levels.

Maria Black: Our third strategic priority is to benefit our clients with our global scale. Globally, we bring together an unmatched footprint, best-in-class integrated solutions, and industry-leading service and expertise to help our clients and their employees navigate the changing world of work. In fiscal 2024, we continued to leverage this global scale to strengthen our business. We extended our global footprint, acquiring the payroll business of our partner in Sweden, expanding the scope of our Salargo payroll offering to include Iceland and further growing our on-the-ground presence in the APAC region. Our IHCM platform also continued to scale in several European countries and now serves more than 5,000 clients and pays more than 1 million client employees.

Speaker Change: Our third strategic priority is to benefit our clients with our global scale.

Speaker Change: <unk>, we bring together an unmatched footprint best in class integrated solutions and industry, leading service and expertise to help our clients and their employees navigate the changing world of work.

Speaker Change: In fiscal 2024, we continued to leverage this global scale to strengthen our business, we extended our global footprint acquiring the payroll business of our partner in Sweden, expanding the scope of our <unk> payroll offering to include Iceland and further growing our on the ground presence in the APAC region.

Maria Black: We extended our global footprint, acquiring the payroll business of our partner in Sweden, expanding the scope of our Salergo payroll offering to include Iceland, and further growing our on-ground presence in the APAC region. Our IHCM platform also continued to scale in several European countries and now serves more than 5,000 clients and pays more than 1 million client employees.

Speaker Change: Our I HCM platform also continued to scale in several European countries and now serves more than 5000 clients and pays more than 1 million client employees.

Maria Black: Finally, we deepened our existing partnerships with several other leading technology providers to further simplify HCM processes and broaden the spectrum of support we can provide our clients.

Maria Black: Finally, we deepened our existing partnerships with several other leading technology providers to further simplify HCM processes and broaden the spectrum of support we can provide our clients. Next, I'd like to share some new client wins from Q4 to highlight how we're leading in workforce innovation and delivering value for our clients. In U.S. small business, we continue to successfully onboard new retirement services clients across multiple industry verticals. During the quarter, we added the plan of a Texas-based insurance agency, which was challenged by manual processes and the management of multiple providers.

Speaker Change: Finally, we deepened our existing partnerships with several other leading technology providers to further simplify HCM processes and broadened the spectrum of support we can provide our clients.

Maria Black: Next, I'd like to share some new client wins from Q4 to highlight how we're leading in workforce innovation and delivering value for our clients. In U.S. small business, we continued to successfully onboard new retirement services clients across multiple industry verticals during the quarter. We added the plan of a Texas-based insurance agency, which was challenged by manual processes and the management of multiple providers. ADP's advanced technology and plans to do sherry solutions simplified the clients plan administration, reduced its manual oversight, and lowered its plan fees. The ADP team made the transition easy and stress-free by providing the client with critical management of the transfer process, as well as regular briefings on the plans set up.

Speaker Change: Next I'd like to share some new client wins from Q4 to highlight how we're leading in workforce innovation and delivering value for our clients.

Speaker Change: In U S. Small business, we continue to successfully onboard new retirement services clients across multiple industry verticals.

Speaker Change: During the quarter, we added the plan of a Texas based insurance agency, which was challenged by manual processes and the management of multiple providers ADP.

Maria Black: ADP's advanced technology and planned fiduciary solutions simplify the client's plan administration, reduce its manual oversight, and lower its plan fees. The ADP team made the transition easy and stress-free by providing the client with critical management of the transfer process, as well as regular briefings on the plan setup. This is just one of the thousands of new clients who turn to our retirement services solution every year. In fact, we recently took the top spot as the nation's largest 401k record keeper by total plans and total 401k plans in the plan sponsor magazine 2024 defined contribution record keeping survey.

Speaker Change: ADP has advanced technology and plans fiduciary solutions simplified the clients plan administration reduced it's manual oversight and lowered its plan fees.

Speaker Change: ADP team made the transition easy and stress free by providing the client with critical management of the transfer process as well as regular briefings on the plan setup.

Maria Black: This is just one of the thousands of new clients who turn to our retirement services solution every year. In fact, we recently took the top spot as the nation's largest 401k record keeper by total plans and total 401k plans in the Plan Sponsor Magazine 2024 Defined Contribution Record Keeping Survey. We serve over 170,000 retirement services clients, and it brings me great joy to see how ADP is helping employers address the retirement savings needs of so many Americans. We look forward to continuing the momentum in our retirement services business in fiscal 2025.

Speaker Change: This is just one of the thousands of new clients, who turned to our retirement services solution every year.

Speaker Change: In fact, we recently took the top spot as the nation's largest 401k record keeper by total plans and totaled 401, K plans and the planned sponsor magazine 2020 for defined contribution Recordkeeping survey.

Maria Black: We serve over 170,000 retirement services clients, and it brings me great joy to see how ADP is helping employers address the retirement savings needs of so many Americans. We look forward to continuing the momentum in our retirement services business in fiscal 2025. In our HR outsourcing business, an orthopedic device company that had grown extensively through acquisition recognized it needed a deeper HR and technology infrastructure to support its future growth. So it turned to our comprehensive services support model to integrate its acquired companies onto a common platform.

Speaker Change: We serve over 170000 retirement services clients and it brings me great Joy to see how ADP is helping employers address the retirement savings needs of so many Americans, we look forward to continuing the momentum in our retirement services business in fiscal 2025.

Maria Black: In our HR outsourcing business, an orthopedic device company who had grown extensively through acquisition recognized it needed a deeper HR and technology infrastructure to support its future growth. So it turned to our comprehensive services support model to integrate its acquired companies onto a common platform. We look forward to supporting this client's current needs and helping it expand in the future. Additionally, comprehensive services cost a major milestone in fiscal 2024, generating more than a billion dollars in revenue for the year. This business has come a long way since its launch in 2008, and we look forward to leaning into our outsourcing business as a differentiator.

Speaker Change: In our HR outsourcing business and orthopedic device company, who had grown extensively through acquisition recognized it needed a deeper HR and technology infrastructure to support its future growth. So it turned to our comprehensive services support model to integrate acquired companies onto a common platform.

Maria Black: We look forward to supporting this client's current needs and helping it expand in the future. Additionally, Comprehensive Services crossed a major milestone in fiscal 2024, generating more than a billion dollars in revenue for the year. This business has come a long way since its launch in 2008, and we look forward to leaning into our outsourcing business as a differentiator. In U.S. Enterprise, we welcomed one of the largest automotive dealers in the Midwest to our NextGen HCM platform.

Speaker Change: <unk> well.

Speaker Change: We look forward to supporting this client's current needs and helping it expand in the future. Additionally.

Speaker Change: Additionally, comprehensive services crossed a major milestone in fiscal 2024 generating more than $1 billion in revenue for the year.

Speaker Change: This business has come a long way since its launch in 2008, and we look forward to leaning into our outsourcing business as a differentiator.

Maria Black: In US Enterprise, we welcomed one of the largest automotive dealers in the Midwest to our next gen HCM platform following several years of rapid growth. This client wanted to reimagine their HCM strategy to help. Our team went on site and conducted a deep review of its current practices and pain points. We developed a plan that would leverage our next gen HCM platform, flexible position management structure, and other advanced HCM tools to address the organization's current and future HR strategy. Our initial solution included HR payroll, time, and benefits, and the client later added recruiting and talent management.

Speaker Change: And U S enterprise, we welcomed one of the largest automotive dealers in the Midwest to our next Gen HCM platform followed.

Maria Black: Following several years of rapid growth, this client wanted to reimagine their HCM strategy. To help, our team went on site and conducted a deep review of its current practices and pain points. We developed a plan that would leverage our NextGen HCM platform, flexible position management structure, and other advanced HCM tools to address the organization's current and future HR strategy. Our initial solution included HR, payroll, time, and benefits, and the client later added recruiting and talent management.

Speaker Change: Following several years of rapid growth. This client wanted to re imagine their HCM strategy to help our team, but onsite and conducted a deep review of its current practices and pinpoints. We developed a plan that would leverage our next gen HCM platform flexible position management structure and other advanced.

Speaker Change: <unk> HCM tools to address the organization's current and future HR strategy.

Speaker Change: Our initial solution included HR payroll time and benefits and the client later added recruiting and talent management, we look forward to helping shape the future of their workforce together.

Maria Black: We look forward to helping shape the future of their workforce together.

Maria Black: We look forward to helping shape the future of their workforce together. Overall, we were extremely pleased with our strong financial and strategic outcomes this past year. In fiscal 2024, ADP was recognized as the world's most admired company by Fortune magazine for the 18th consecutive year, and we also celebrated our 30th straight year on the Fortune 500. As some of you may know, 2024 is also our 75th anniversary.

Maria Black: Overall, we were extremely pleased with our strong financial and strategic outcomes this past year. In fiscal 2024, ADP was recognized as a world's most admired company by Fortune magazine for the 18th consecutive year, and we also celebrated our 30th straight year on the Fortune 500. As some of you may know, 2024 is also our 75th anniversary.

Speaker Change: Overall, we were extremely pleased with our strong financial and strategic outcomes. This past year.

Speaker Change: In fiscal 2020 for ADP was recognized as the world's most admired company by Fortune magazine for the 18th consecutive year and we also celebrated our 30th straight year on the Fortune 500.

Speaker Change: As some of you May know 2024 is also our 70 <unk> anniversary.

Maria Black: As I reflect on ADP's enduring impact on the world of work, the one constant on our journey is our talented associates. See at the recent accolades we received or the 75 years of support for our clients, we owe our recognition and strong financial performance to our 64,000 dedicated associates who deliver the great product and exceptional experiences. And continue to drive our client satisfaction scores to new highs. I want to take a moment to recognize them for their incredible contributions. Thank you for all you do for ADP and for our clients.

Maria Black: As I reflect on ADP's enduring impact on the world of work, the one constant on our journey is our talented associates. Be it the recent accolades we received or the 75 years of support for our clients, we owe our recognition and strong financial performance to our 64,000 dedicated associates who deliver a great product and exceptional experiences and continue to drive our client satisfaction scores to new highs. I want to take a moment to recognize them for their incredible contributions. Thank you for all you do for ADP and for our clients. And now I'll turn the call over to Don. Thank you, Maria. And good morning, everyone.

Speaker Change: As I reflect on Adp's enduring impact on the world of work the one constant on our journey is our talented associates via at the recent accolades, we've received or the 75 years of support for our clients, we owe a recognition and strong financial performance to our 64000 dedicated associates who deliver.

Speaker Change: <unk>, the great product and exceptional experiences and continue to drive our client satisfaction scores to new highs.

Speaker Change: I want to take a moment to recognize them for their incredible contributions. Thank you for all you do for ADP and for our clients.

Don McGuire: And now I'll turn the call over to Don. Thank you, Maria, and good morning, everyone. I'll start by expanding on Maria's comments around our Q4 results and then cover our physical 25 financial outlook. Q4 performance was very strong overall, helping to drive fiscal 24 revenue and earnings growth towards the high end of our expectations. As previously mentioned, we benefited from broad-based strength in employer services with exceptional new business bookings, better-than-anticipated retention, and stable pace for control growth. Kia revenue growth in the quarter also came in better than expected. Our strong Q4 results contributed to our full-year revenue growth of 7%, bringing our fiscal 24 revenue to $19.2 billion.

Speaker Change: And now I'll turn the call over to Don.

Don Edward McGuire: I'll start by expanding on Maria's comments around our Q4 results and then cover our fiscal 25 financial outlook. Q4 performance was very strong overall, helping to drive fiscal 24 revenue and earnings growth towards the high end of our expectation. As previously mentioned, we benefited from broad-based strength in employer services with exceptional new business bookings, better than anticipated retention, and stable pays-per-control growth. P.O.

Don: Thank you Maria and good morning, everyone I will start by expanding on Maria's comments around our Q4 results and then cover our fiscal 'twenty five financial outlook.

Don: Q4 performance was very strong overall, helping to drive fiscal 'twenty for revenue and earnings growth towards the high end of our expectations.

Speaker Change: As previously mentioned, we benefited from broad based strength in employer services with exceptional new business bookings better than anticipated retention and stable pays per control groups.

Speaker Change: PEO revenue growth in the quarter also came in better than expected.

Don Edward McGuire: Revenue growth in the quarter also came in better than expected. Our strong Q4 results contributed to our full-year revenue growth of 7%, bringing our fiscal 2024 revenue to $19.2 billion. For our employer services segment, revenue in the quarter increased 7% on both a reported and organic constant currency basis.

Speaker Change: Our strong Q4 results contributed to our full year revenue growth of 7%, bringing our fiscal 2000 and for revenue to $19 $2 billion.

Don McGuire: For our employer services segment, revenue in the quarter increased 7% on both a reported and organic constant currency basis. These results were bolstered by a slightly better-than-expected contribution from client funds interest. Our ES margin expanded 220 basis points in the fourth quarter, which exceeded our expectation. For the full year, our ES revenue grew 8% on a reported basis and 7% on an organic constant currency basis, and our ES margin expanded 210 basis points. For the PEO segment, revenue increased 6% for the quarter as growth accelerated from Q3. Average work set employees increased 3% on a year-over-year basis in the fourth quarter to 742,000.

Speaker Change: For our employer services segment revenue in the quarter increased 7% on both a reported and organic constant currency basis.

Don Edward McGuire: These results were bolstered by a slightly better-than-expected contribution from client funds' interest. Our ES margin expanded 220 basis points in the fourth quarter, which exceeded our expectations. For the full year, our ES revenue grew 8% on a reported basis and 7% on an organic constant currency basis, and our ES margin expanded 210 basis points. For the PEO segment, revenue increased 6% for the quarter as growth accelerated from Q3. Average worksite employees increased 3% on a year-over-year basis in the fourth quarter to 742,000.

Speaker Change: These results were bolstered by a slightly better than expected contribution from client funds interest our es margin expanded 220 basis points in the fourth quarter, which exceeded our expectations.

Speaker Change: For the full year, our Es revenue grew 8% on a reported basis and 7% on an organic constant currency basis, and our es margin expanded 210 basis points.

Speaker Change: The PEO segment revenue increased 6% for the quarter as growth accelerated from Q3.

Speaker Change: Average worksite employees increased 3% on a year over year basis in the fourth quarter to 742000.

Don McGuire: PEO margin contracted 240 basis points, slightly more than we anticipated, due to higher operating expenses and unfavorable actuarial loss development in workers' compensation reserves. For the full year, PEO revenue grew 4%, average work set employees increased 2%, and our margin contracted 150 basis points, with the margin contraction mostly due to less favorable actuarial loss development in workers' compensation reserves versus the prior year.

Don Edward McGuire: PEO's margin contracted 240 basis points, slightly more than we anticipated due to higher operating expenses and unfavorable actuarial loss development in its workers' compensation reserve. For the full year, P.O. revenue grew 4%, average worksite employees increased 2%, and our margin contracted 150 basis points, with the margin contraction mostly due to less favorable actuarial loss development in workers' compensation reserves versus the prior year. Our fiscal 2024 PO new business bookings growth rate also moderated from the prior year.

Speaker Change: PEO margin contracted 240 basis points slightly more than we anticipated due to higher operating expenses and unfavorable actuarial loss development in workers' compensation reserves.

Speaker Change: For the full year <unk>.

Speaker Change: Revenue grew 4% average worksite employees increased 2% and our margin contracted 150 basis points with the margin contraction, mostly due to less favorable actuarial loss development in workers' compensation reserves versus the prior year our.

Don McGuire: Our fiscal 2024 PEO new business bookings growth rate also moderated from the prior year. I'll now share our outlook for Fiscal 25. While the macro backdrop remains uncertain, we believe we are well-positioned to deliver solid overall financial results while continuing to invest in our future growth, consistent with our strategic priorities. Our fiscal 2025 outlook assumes some moderation in economic activity over the course of the year. Beginning with the ES segment, we expect revenue growth of 5% to 6% driven by the following key assumptions. We expect ES new business bookings growth of 4% to 7%, representing solid growth after coming in at the high end of the same guidance in fiscal 24.

Speaker Change: Our fiscal 2020 for PEO, new business bookings growth rate also moderated from the prior year.

Don Edward McGuire: I'll now share our outlook for fiscal 2025. While the macro backdrop remains uncertain, we believe we are well positioned to deliver solid overall financial results while continuing to invest in our future growth, consistent with our strategic priorities. Our fiscal 2025 outlook assumes some moderation in economic activity over the course of the year.

Speaker Change: I'll now share our outlook for fiscal 'twenty five.

Speaker Change: The macro backdrop remains uncertain. We believe we are well positioned to deliver solid overall financial results, while continuing to invest in our future growth consistent with our strategic priorities.

Speaker Change: Fiscal 2025 outlook assumes some moderation in economic activity over the course of the year.

Don Edward McGuire: Beginning with the ES segment, we expect revenue growth of five to six percent, driven by the following key assumptions. We expect ES New Business Bookings growth of 4 to 7%, representing solid growth after coming in at the high end of the same guidance in fiscal 24. For ES retention, we forecast a 10 to 30 basis point decline from the 92% result in fiscal 24.

Speaker Change: Beginning with the Es segment, we expect revenue growth of 5% to 6% driven by the following key assumptions we.

Speaker Change: We expect Es, new business bookings growth of 4% to 7% representing solid growth after coming in at the high end of the same guidance in fiscal 'twenty four.

Don McGuire: For ES retention, we forecast a 10 to 30 basis point decline from the 92% result for fiscal 24. We are encouraged by our recent record client satisfaction scores, but we think it's prudent to continue to expect some retention pressure from higher small business out-of-business levels and slightly slower economic growth overall. As we mentioned on our prior earnings call, we see the potential for below normal U.S. pays for control growth in fiscal 2025, and our outlook assumes 1 to 2% growth for the year. This view is consistent with most economists' forecast for continued moderation in U.S.

Don Edward McGuire: We are encouraged by our recent record client satisfaction scores, but we think it's prudent to continue to expect some retention pressure from higher small business out of business levels and slightly slower economic growth overall. As we mentioned on our prior earnings call, we see the potential for below-normal U.S. pays-per-control growth in fiscal 2025, and our outlook assumes 1 to 2 percent growth for the year. This view is consistent with most economists' forecast for continued moderation in U.S. private sector payroll growth.

Don McGuire: Private sector payroll growth.

Don McGuire: Joseph. After price contributed around 150 basis points to ES revenue growth in both physical 23 and physical 24, we anticipated a benefit closer to 100 basis points in physical 25, which is in line with the moderation in overall inflation. We also expect FX to transition from a modest tailwind to ES revenue growth in physical 24 to a slight headwind in physical 25. And for client funds interest revenue, the interest rate backdrop remains dynamic, and it's important to remember our client funds interest revenue forecast reflects the current forward yield curve, which is likely to continue to evolve as we move through physical 25.

Don Edward McGuire: After price contributed around 150 basis points to ES revenue growth in both fiscal 23 and fiscal 24, we anticipate a benefit closer to 100 basis points in fiscal 25, which is in line with the moderation in overall inflation. We also expect FX to transition from a modest tailwind to ES revenue growth in fiscal 24 to a slight headwind in fiscal 25. And for client funds' interest revenue, the interest rate backdrop remains dynamic.

Speaker Change: And the Es revenue growth in fiscal 'twenty four to a slight headwind in fiscal 'twenty five.

Speaker Change: And for client funds interest revenue the.

Speaker Change: The interest rate backdrop remains dynamic and it's important to remember our client funds interest revenue forecast reflects the current forward yield curve, which is likely to continue to evolve as we move through fiscal 'twenty five.

Don Edward McGuire: And it's important to remember our client funds interest revenue forecast reflects the current forward yield curve, which is likely to continue to evolve as we move through fiscal 25. At this point, we expect our average yield to increase from 2.9% in fiscal 24 to 3.1% in fiscal 25, which takes into account the market's expectations for short-term interest rates to decrease during the year.

Don McGuire: At this point, we expect our average yield to increase from 2.9% in physical 24 to 3.1% in physical 25, which contemplates the market's expectations for short-term interest rates to decrease during the year. We expect our average client funds balances to grow 3 to 4% in physical 25. Putting those together, we expect our client funds interest revenue to increase from $1.02 billion in physical 24 to a range of $1.13 to $1.15 billion dollars in physical 25. Meanwhile, we expect net impact from our client fund strategy to increase to a range of 1 to 1.02 billion dollars in physical 25.

Speaker Change: At this point, we expect our average yields to increase from two 9% in fiscal 'twenty four to three 1% in fiscal 'twenty, five which contemplates the market's expectations for short term interest rates to decrease during the year.

Speaker Change: We expect our average client funds balances to grow 3% to 4% in fiscal 'twenty five.

Don Edward McGuire: We expect our average client funds balances to grow 3 to 4% in fiscal 25. Putting those together, we expect our client funds interest revenue to increase from $1.02 billion in fiscal 24 to a range of $1.13 to $1.15 billion in fiscal 25. Meanwhile, we expect net impact from our client fund strategy to increase to a range of one to $1.02 billion in fiscal 25.

Speaker Change: Putting those together, we expect our client funds interest revenue to increase from $1.02 billion in fiscal 'twenty four to a range of $1 one three to $1 one 5 billion.

Speaker Change: In fiscal 'twenty five.

Speaker Change: Meanwhile, we expect net impact from our client fund strategy to increase to a range of $1 billion to $1.02 billion in fiscal 'twenty five.

Don McGuire: We expect ES margin to increase 100 to 120 basis points in physical 25 during by operating leverage, as well as continued contribution from client funds interest revenue partially offset by ongoing investments to advance our key strategic priorities. Moving on to the PEO segment, we expect PEO revenue to grow 4 to 6%, and PEO revenue excluding zero margin pass-throughs to grow 3 to 4% in physical 25. Our PEO revenue growth outlook assumes average work-side employee growth of 1 to 3%. This reflects our expectation for continued new business bookings growth and modestly better retention to be offset by declining PEO pace per control growth that remains below our historical experience.

Speaker Change: We expect Es margin to increase 100 to 120 basis points in fiscal 'twenty, five driven by operating leverage as well as continued contribution from client funds interest revenue, partially offset by ongoing investments to advance our key strategic priorities.

Don Edward McGuire: We expect ES margin to increase 100 to 120 basis points in fiscal 25, driven by operating leverage, as well as continued contribution from client funds interest revenue, partially offset by ongoing investments to advance our key strategic priorities. Moving on to the PEO segment, we expect PEO revenue to grow 4-6% and PEO revenue excluding zero-margin pass-throughs to grow 3-4% in fiscal 25.

Speaker Change: Moving onto the PEO segment, we expect revenue to grow 4% to 6% and PEO revenue, excluding zero margin pass throughs to grow 3% to 4% in fiscal 'twenty five.

Don Edward McGuire: Our PEO revenue growth outlook assumes average worksite employee growth of 1 to 3%. This reflects our expectation for continued new business bookings growth and modestly better retention to be offset by declining PEO pays per control growth that remains below our historical experience. We expect PEO margin to decrease 90 to 110 basis points in fiscal 25.

Speaker Change: <unk> revenue growth outlook assumes average worksite employee growth of 1% to 3%. This reflects our expectation for continued new business bookings growth and modestly better retention to be offset by declining PEO pays per control growth that remains below our historical experience.

Don McGuire: We expect PEO margin to decrease 90 to 110 basis points in physical 25. This anticipated margin decline reflects our forecast for zero margin pass-throughs to grow faster than PEO revenue and an increase in our workers' compensation costs and higher PEO selling expense from accelerating new business bookings growth. Adding it all up, our consolidated revenue outlook is for 5 to 6% growth in physical 25, and our adjusted EBIT margin outlook is for expansion of 60 to 80 basis points. We expect our effective tax rate to be around 23%. And we expect physical 25 adjusted EPS growth of 8 to 10%, supported by buybacks.

Speaker Change: We.

Speaker Change: <unk> PEO margin to decrease 90 to 110 basis points in fiscal 'twenty five.

Don Edward McGuire: This anticipated margin decline reflects our forecast for zero margin pass-throughs to grow faster than PEO revenue, an increase in our workers' compensation costs, and higher PEO selling expenses from accelerating new business bookings growth. Adding it all up, our Consolidated Revenue Outlook is for 5 to 6% growth in Fiscal 2025, and our Adjusted EBIT Margin Outlook is for an expansion of 60 to 80 basis points. We expect our effective tax rate to be around 23%, and we expect fiscal 25 adjusted EPS growth of 8 to 10% supported by buybacks.

Speaker Change: This anticipated margin decline reflects our forecast for zero margin pass throughs to grow faster than PEO revenue and increase in our workers compensation costs and higher selling expense from accelerating new business bookings growth.

Speaker Change: Adding it all up our consolidated revenue outlook is for 5% to 6% growth in fiscal 'twenty five and our adjusted EBIT margin outlook is for expansion of 60 to 80 basis points.

Speaker Change: We expect our effective tax rate to be around 23% and.

Speaker Change: And we expect fiscal 'twenty five adjusted EPS growth of 8% to 10% supported by buybacks.

Don McGuire: One quick note on our margin cadence: we anticipate adjusted EBIT margin expansion on a year-over-year basis to be more modest in the first half of the year before trends ramp in the second half of fiscal 2025.

Michelle: One quick note on our margin, Kate. We anticipate adjusted EBIT margin expansion on a year-over-year basis to be more modest in the first half of the year before trends ramp up in the second half of fiscal 2025. Thank you. And I'll now turn it back to Michelle for Q&A. Thank you. If you'd like to ask a question, please press the star one more time. If your question has been answered and you'd like to remove yourself, please press star 11 again.

Speaker Change: One quick note on our margin cadence, we anticipate adjusted EBIT margin expansion on a year over year basis to be more modest in the first half of the year before trends ramp in the second half of fiscal 2025. Thank you and I'll now turn it back to Michele for Q&A.

Unknown Executive: Thank you, and I'll now turn it back to Michelle for Q&A. Thank you.

Michele: Thank you if you'd like to ask a question. Please press star one one.

Unknown Executive: If you'd like to ask a question, please press Star 11. If your question has been answered and you'd like to remove yourself in the queue, please press Star 11 again.

Speaker Change: If your question has been answered and you'd like to remove yourself from the queue. Please press star one again.

Bryan C. Bergin: Our first question comes from Bryan Bergin with TD Cowan. Your line is open. Hi, good morning. Thank you. I want to start with bookings here.

Bryan Bergin: Our first question comes from Bryan Bergin with TD Cowan. Your line is open.

Speaker Change: Our first question comes from Bryan Bergin with TD Cowen Your line is open.

Unknown Executive: Hi, good morning. Thank you. I want to start with bookings here. So it sounds like a pretty solid close to the year. Can you provide more color on the attribution of that bookings performance across the business? And in general, I guess when you're looking at demand into July, just any changes based on employer size or geography?

Bryan C. Bergin: Hi, Good morning, Thank you I want to start with bookings here. So it sounds like a pretty solid close to the year can you provide more color on the attribution of that bookings performance across the business and in general I guess when you're looking at demand into July just any changes based on employer size or geography.

Unknown Executive: Sure.

Maria Black: So sounds like a pretty solid close to the year. Can you provide more color on the attribution of that bookings performance across the business? And, in general, I guess when you're looking at demand into July, just any changes based on employer size or geography? Sure. Good morning, Bryan.

Unknown Executive: Good morning, Bryan. Great to hear from you. I love talking about bookings, especially on the heels of what was truly an exceptional performance by the overall team in the fourth quarter. To answer the first part of the question. It was broad based. So we did see strength across our growth in small business, mid market, enterprise, and international. So we're really pleased with the momentum that we see as it relates to the overall receptivity to the offerings, to the product, to the execution, and really proud of how the team moved through the quarter, which led to the exceptional result at 7% for the year.

Michele: Sure Good morning, Brian Great to hear from you I love talking about bookings, especially on the heels of what was truly an exceptional performance by the.

Maria Black: Great to hear from you. I love talking about bookings, especially on the heels of what was truly an exceptional performance by the overall team in the fourth quarter. To answer the first part of the question, it was broad-based. So we did see strength across our growth in small business, mid-market, enterprise, and international. So we're really pleased with the momentum that we see as it relates to the overall receptivity to the offerings, to the product, to the execution, and really proud of how the team moved through the quarter, which led to the exceptional result of 7% for the year.

Unknown Executive: In terms of the demand environment, overall, and what we see, what I would offer is that, you know, the HCM demand environment remains strong. One of the things that's unique about HCM is what we do is not, you know, it's not a nice to have. It's actually an imperative for company to run their business and either have their associates pay the need HR tools, and certainly it's not getting any easier. Whether you're in the down market, mid market, or up market, to navigate being an employer, and as such, we fit squarely into that. So we feel good about the momentum, stepping out of the quarter. We feel good about the demand environment, stepping into the quarter. Pipelines from a year-on-year perspective look strong.

Maria Black: In terms of the demand environment overall and what we see, what I would say is that the HCM demand environment remains strong. One of the things that's unique about HCM is what we do is not, you know, it's not a nice-to-have. It's actually an imperative for a company to run its business. They need to have their associates pay.

Don Edward McGuire: They need HR tools. And certainly, it's not getting any easier, whether you're in the down-market, mid-market, or up-market, to navigate being an employer. And as such, we fit squarely into that. So we feel good about the momentum stepping out of the quarter. We feel good about the demand environment stepping into the quarter. Pipelines from a year-on-year perspective look strong. So we're very optimistic and proud of the performance. Okay, I appreciate that. And then my follow up just on the kind of pace per control performance here.

Unknown Executive: So we're very optimistic and proud of the performance. Okay, I appreciate that.

Unknown Executive: And then my follow up just on kind of pace per control performance here.

Don Edward McGuire: Can you compare and contrast the pace per control performance in ES versus what you're kind of seeing on the same store sale, PPC and PEO, and any cadence assumptions here as you go through 25? Yeah, Brian. I'll take that one.

Unknown Executive: Can you compare and contrast the pace per control performance in ES versus what you're kind of seeing on the same store sale, PPC, and PEO, and any cadence assumptions here as you go through 25. Yeah, Brian, I'll take that one. So, as we look at pace per control, we, you know, we do think that the market, the labor market is still pretty resilient. I mean, there are a number of factors that we look to, and, you know, with you look at the BLS, you look at the unemployment rate. Jolts report came in the other day; it was down, but better than expected. Labor force participation still got some room to go, etc.

Don Edward McGuire: So as we look at pays per control, we, you know, we do think that the market, the labor market, is still pretty resilient. I mean, there are a number of factors that we look at. And, you know, if you look at the BLS, you look at the unemployment rate, Jolt's report came in. The other day it was down but better than expected, labor force participation still has some room to go, etc. So jobless claims are kind of neither here nor there. They're benign.

Don Edward McGuire: So we think there's still continued good strength in the market. Having said that, we do think that pays per control is going to moderate. And we have said we're thinking one to 2% as we go forward into 25. I would say that we do expect that the pay per control growth in the PEO will be lower than it is in ES. But we're still optimistic that there's growth to be had.

Speaker Change: It was down but better than expected.

Speaker Change: Labor Force participation has still got some room to go et cetera. So jobless claims are kind of.

Unknown Executive: So jobless claims are kind of. Now they heard no there. They're benign. So we think there's still continued good strength in the market. Having said that, we do think that pace per control is going to moderate, and we have said we're thinking 1 to 2% as we go forward into 25. I would say that we do expect that the pace per control growth in the PEO will be lower than it is in ES, but we're still optimistic that there's growth to be had. But certainly, we expect ES to be somewhat stronger than we expect PEO.

Speaker Change: Neither here nor there they're benign. So we think there's still continued good strength in the market, having said that we do think that pays per control is going to moderate.

Michele: We have said, we're thinking 1% to 2% as we go forward into <unk>.

Michele: And the 25 I would say that we do expect that the pays per control growth in the PEO will be.

Michele: Lower than it is in yes, but we're still optimistic that there is growth to be had but certainly we expect yes to be somewhat stronger than we expect.

Speaker Change: No.

Unknown Executive: Thank you.

Speaker Change: Thank you.

Don Edward McGuire: But certainly, we expect ES to be somewhat stronger than we expect PEO. Thank you. Thank you. Our next question comes from Dan Dolev with Mizuho. Your line is open. Oh, thanks guys for taking my question. You know, just to touch on ES again, like...

Speaker Change: Thank you. Our next question comes from Dan Donlan with Mizuho. Your line is open.

Dan Dolev: Our next question comes from Dan Dolos with Mizzouho. Your line is open. Oh, thanks, guys, for taking my question. You know, just to touch again on ES like.

Dan Donlan: Alright, Thanks, guys for taking my question just to touch again on Es like.

Unknown Executive: I kind of want to know like how much of that strength is idiosyncratic and things that you're doing internally versus the macro, and then maybe the follow up is again asking about the guidance and like maybe you can lay out you know what could what could go well and what could go wrong in terms of the macro down the line macro for the guide that that would be it. Thank you. Yeah Dan, so you know just to follow up on that I would say that you could you know will unemployment remain as low as it has been? I think there's no indication that it's going to worsen. It's still at, you know, decade lows or comparable to decade lows. There is good strength; there seems to be good strength across the broader spectrum of new jobs. So the NER report to motor earlier today, and we're getting to see new jobs. So I think that we put out there a PPC growth number that's realistic.

Dan Dolev: I kind of want to know, like, how much of that strength is idiosyncratic and things that you're doing internally versus the macro? And then maybe the follow-up is, again, asking about the guidance and, like, maybe you can lay out, you know, what could go well and what could go wrong in terms of the macro, the underlying macro for the guide. That would be it.

Dan Donlan: I kind of want to know like how much of that strength is idiosyncratic and changes that youre doing internally versus the macro and then maybe the follow up is again asking about the guidance in late maybe you can lay out what could what could go well and what could go wrong in terms of the macro the underlying macro for.

Speaker Change: The guide that'd be it thank you.

Don Edward McGuire: Yeah, Dan, so you know, just to follow up on that, I would say that you could, you know, unemployment will remain as low as it has been, I think there's no indication that it's going to worsen. It's still at, you know, decade lows are comparable to decade lows. There is good strength; there seems to be good strength across the broader spectrum of new jobs. So the NAR report came out earlier today, and we're seeing new jobs. So I think that we put out there a PPC growth number that's realistic. What could change that?

Dan Donlan: Yeah, Dan So just to follow up on that I would say that you could.

Speaker Change: Unemployment remained as low as it has been I think there is no indication that it's going to worsen. It's still at decade lows are comparable to decade lows. There is good strength there seems to be good strength across the broader spec.

Speaker Change: Spectrum of new jobs. So the NAR report came out earlier today, and we're continuing to see new jobs.

Speaker Change: So I think that.

Speaker Change: We put out there a PPC growth number that's realistic.

Unknown Executive: What could change that we could imagine all kinds of macro issues, but I prefer not to do any imagining. I think we're trying to do what we can based on what we know today, so I think that what we have today is pretty good. But, as I mentioned earlier to Brian's question, we certainly recognize that yes is likely to be stronger than PO. And Dan, if I can just add on the sales side just with respect to are we are we driving the result, is that being driven by macro, my answer to you would be both. And so I think we have a strong demand environment. I touched on that during Brian's question in terms of our offer and how squarely it fits into that demand environment, and that's really a broad-based execution across the entire business. So it's the investments we've made into our products, it's the best in class service that we have.

Speaker Change: What could change that we could imagine all kinds of macro issues, but I'd prefer not to do any imagining I think we're trying to do what we can based on what we know today, so I think that.

Maria Black: We could imagine all kinds of macro issues, but I prefer not to do any imagining. I think we're trying to do what we can based on what we know today. So I think that what we have today is pretty good, but as I mentioned earlier in response to Brian's question, we certainly recognize that ES is likely to be stronger than PEO. And Dan, if I can just add on the sales side, just with respect to are we driving the result? Is it being driven by macro?

Speaker Change: I think that what we have today is pretty good but as I mentioned earlier to Brian's question. We certainly recognize that es is likely to be stronger than PEO.

Maria Black: My answer to you would be both. And so I think we have a strong demand environment. I touched on that during Bryan's question, in terms of our offer and how squarely it fits into that demand environment. And that's really a broad-based execution across the entire business. So it's the investments we've made in our products. It's the best-in-class service that we have.

Speaker Change: And Dan if I can just add on the sales side.

Speaker Change: Just with respect to are we are we driving the result is that being driven by macro my answer to you would be both and so I think we have a strong demand environment I touched on that during Brian's question.

Speaker Change: Terms of our offer and how squarely fits into that demand environment, and that's really a broad based execution across the entire business. So it's the investments we've made into our products. It's the best in class service that we have we see that in the past results by the way, we see that in our retention results as well and so I think we've been getting stronger and stronger.

Unknown Executive: We see that in the MPS results by the way we see that in our retention results as well, and so I think we've been getting stronger and stronger. I think the value proposition of what we offer is an imperative for businesses, and then once again I would say, yeah, we are executing incredibly well across the full spectrum of our sales differentiation. I mentioned in the prepared remarks I consider it to be one of the greatest competitive advantages that ADP has. Part of that is our ability to canvas the entire markets, whether buyers trying to buy digitally.

Maria Black: We see that in the MPS results. By the way, we've seen that in our retention results as well. And so I think we've been getting stronger and stronger. I think the value proposition of what we offer is an imperative for businesses. And then once again, I would say, yeah, we are executing incredibly well across the full spectrum of our sales differentiation. As I mentioned in my prepared remarks, I consider it to be one of the greatest competitive advantages that ADP has.

Speaker Change: I think the value proposition of what we offer is an imperative for businesses and then once again I would say, yes, we are executing incredibly well across the full spectrum of our sales differentiation I mentioned in the prepared remarks I consider it to be when our greatest competitive advantages that ADP has part of that is our ability to canvass the entire <unk>.

Speaker Change: Markets, whether a buyers trying to buy digitally or they are trying to buy through a channel where they are trying to buy the traditional way like we show up at every single time, we lean right into that with the best product and the best service out there and as a result of all of those things I think we are.

Unknown Executive: Or they're trying to buy through a channel, or they're trying to buy the traditional way. Like we show up at every single turn, and we lean right into that with the best products and the best service out there. As a result of all of those things, I think we are executing very well.

Speaker Change: Executing very well.

Unknown Executive: Great results. Thank you.

Maria Black: Part of that is our ability to canvas the entire market. So whether a buyer is trying to buy digitally, or they're trying to buy through a channel, or they're trying to buy the traditional way, we show up at every single turn, and we lean right into that with the best products and the best service out there. And as a result of all of those things, I think we are executing very well. Great results, thank you.

Speaker Change: Great results. Thank you.

Unknown Executive: Thank you.

Speaker Change: Thank you.

James Faucette: Thank you. Our next question comes from James Faucet with Morgan Stanley. Your line is open. Great, thank you so much. I wanted to ask on competition, some of our recent conversations with those in the industry. We have kind of indicated that there's been some meaningful price compression from some of your competitors, particularly in the mid and in down market segments. Have you observed others getting more competitive on price, or from your perspective, is it fairly status quo right now?

Maria Black: Thank you. Thank you. Our next question comes from James Faucette with Morgan Stanley. Your line is open. Great, thank you so much.

Speaker Change: Thank you. Our next question comes from James Faucette with Morgan Stanley. Your line is open.

James Eugene Faucette: I wanted to ask you about competition. In some of our recent conversations with those new industries, we have kind of indicated that there's been some meaningful price compression from some of your competitors, particularly in the mid and down market segments. Have you observed others getting more competitive on price, or, from your perspective, is it fairly status quo? Good morning, James.

James Eugene Faucette: Great. Thank you so much I wanted to ask on competition.

James Eugene Faucette: Some of our recent conversations with those in the industry.

James Eugene Faucette: We have kind of indicated that there has been some meaningful price compression from some of your competitors, particularly on the mid and down market segments.

Speaker Change: Have you observed others getting more competitive on price or from your perspective is it fairly status quo right now.

Unknown Executive: Good morning, James. What I would offer is it's pretty status quo; we haven't really observed any of those meaningful price compression things of that nature. Given how much we do compete, I think we would see, I would say that there's always some of that in terms of whether it's promotions and things that all of us run at various times throughout the year. But it doesn't seem typical for me, and obviously, you know I've spent a lot of years watching the competitive landscape and the sales. So I haven't seen anything anomalous. I think the one thing that's changed specifically in the competitive landscape is off.

Maria Black: What I would offer is it's pretty status quo. We haven't really observed any meaningful price compression, things of that nature. Given how much we do compete, I think we would see that there's always some of that in terms of whether it's promotions and things that all of us run at various times throughout the year, but it doesn't seem atypical for me. And obviously, you know, I've spent a lot of years watching the competitive landscape and the sales environment. So I haven't seen anything anomalous so far.

Speaker Change: Good morning, James what I would offer is it its pretty status quo quote we haven't really observed any of those meaningful price compression and things of that nature.

Speaker Change: Given how much we do compete I think we would see I would say that theres always some of that in terms of.

Speaker Change: Whether it's promotions and things that all of us run at various times throughout the year, but it doesn't.

Speaker Change: Seen a typical for me and obviously you know I've spent a lot of years watching the competitive landscape and the sales environment. So I haven't seen anything anomalous I think the one thing that's changed specifically in the competitive landscape is off and so when I think about our ability to execute and everything I just mentioned thats product a record with times.

Maria Black: I think the one thing that's changed, specifically in the competitive landscape, is us. And so when I think about our ability to execute everything I just mentioned, the best product, record retention, record MPS, incredible execution by sales, I think we're stronger than we've ever been. So I'd say that's the shift. But from our point of view, it's still a competitive environment that we lean into every single day. I'm very glad to hear that. And then, I'm wondering if you can give a little bit more color on the composition of both.

Unknown Executive: And so when I think about our ability to execute everything I just mentioned: best product, record retention, record MPS, incredible execution by sales, I think we're stronger than we've ever been. So I'd say that's the shift. But from our purposes still a competitive environment that we went into it every single day.

James Eugene Faucette: And record NPS.

James Eugene Faucette: Incredible execution by sales I think we're stronger than we've ever been so I'd say, that's the shift but from our purposes, it's still a competitive environment that we live in and so that every single day.

Unknown Executive: Great.

Speaker Change: Great to hear that and then.

Unknown Executive: Glad to hear that.

Unknown Executive: And then one of you can give a little bit more color on the composition of bookings, especially between the enterprise market and down market.

Speaker Change: I'm wondering if you can give a little bit more color on the composition of bookings, especially between enterprise mid market and down market.

Maria Black: I'm especially between enterprise, mid market, and down market. And also, what do you think about international business? And how should we think about the potential for upswings with their over time as price points in lower cost regions continue to improve? What I would offer is that the down market had incredible strength, by the way, on top of incredible strength. Last year, I think I mentioned, or I did mention during the prepared remarks, we onboarded, sold, and started 50,000 new clients in small business in the fourth quarter alone. So we're officially at 890,000 of our 1.1 million clients are in that down market space.

Unknown Executive: And also, what do you think in the international business and how should we think about the potential up with their over time, over time as price points and lower cost regions continue to improve? What I would offer is that the down market market had incredible strengths, by the way, on top of incredible strengths. Last year, I think I mentioned, or I did mention during the prepared remarks, we onboarded, we sold and started 50,000 new clients in small business in the fourth quarter alone. So we're officially at 890,000 of our 1.1 million clients are in that down market space.

Speaker Change: And also what are you seeing in the international business and how should we think about the potential uplift there over time over time.

Speaker Change: Price points in lower cost regions continue to improve.

Speaker Change: What I would offer is that the downmarket had incredible strength by the way on top of incredible strengths.

Speaker Change: Last year, I think I mentioned or I did mention during the prepared remarks, we on boarded with sold and started 50000.

Maria Black: And so we continue to see broad-based demand, and again, we are executing very well in that. Our mid market sales results were phenomenal. Just an incredible execution by the team.

Unknown Executive: And so we continue just to see broad-based demand. And again, we are executing very well in that our mid market sales results were phenomenal. Just an incredible execution by the team. Again, our product has been getting newer and stronger, so feel really good about that.

Maria Black: Again, our products have been getting newer and stronger. So I feel really good about that. I mentioned also in the prepared remarks what we saw in the enterprise space, specifically with respect to our next-gen HCM offering. One of the reasons I'm so excited about this is that we are seeing record results. We are seeing more than we anticipated, quite significantly more than we anticipated, and we're not even at general availability yet.

Unknown Executive: I mentioned also in the prepared remarks what we saw in the enterprise space, specifically with respect to our next gen HCM offering. One of the reasons I'm so excited about this is that we are seeing record results. We're seeing more than we anticipated, quite significantly more than we anticipated, and we're not even at general availability yet. And what that suggests to me is that the market is ready for this offering; the market's excited about this offering. We see clients wanting to buy in the enterprise space from ADP, and we're stepping into that opportunity. So that's kind of the distribution, very strong strength.

Maria Black: And what that suggests to me is that the market is ready for this offering. The market is excited about this offering. We see clients wanting to buy in the enterprise space from ADP, and we're stepping into that opportunity. So that's kind of the distribution, a very strong strength. You asked about international specifically; international had a fantastic year overall. So it was really the story of four quarters. I think the first quarter of last year was strong year on year, the first quarter was 23, the second quarter got even stronger, the third quarter got even stronger than that, and fourth quarter, I probably guess, got even stronger than that.

Unknown Executive: You asked about international specifically; international had a fantastic year overall. So it was really the story of four quarters. I think first quarter of last year was strong over a year on year, first quarter, 23. Second quarter got even stronger, third quarter got even stronger than that. So overall, our international business had just a fantastic year as well.

Maria Black: So overall, our international business had a fantastic year as well. That's great. I appreciate all the calls, Maureen.

Unknown Executive: That's great. Appreciate all the color line.

Ramsey El: Thank you. Our next question comes from Ramsey, LSL, with Barclays. Your line is open. Hi, thanks for taking my question.

Maria Black: Thanks. Thank you. Our next question comes from Ramsey El Asal with Barclays. Your line is, Hi, thanks for taking my...

Speaker Change: Yeah.

Speaker Change: Hi, Thanks for taking my question.

Ramsey Clark El: I wonder if you could comment on how you're thinking about the balance, striking a balance between pricing and retail, and just sort of also speak to your confidence level about being able to take that hundred basis points of pricing, which I think is more than you took sort of pre-pandemic, although less than you've been taking in this really inflationary environment. How are you, you know? How confident are you that you can take that without tipping retention in the wrong direction?

Unknown Executive: I wonder if you could comment on how you're thinking about the balance striking a balance between pricing and retention and just sort of also speak to your confidence level about being able to take that hundred basis point of pricing, which I think is more than you took sort of pre-pandemic, although less than you've been taking in this really inflationary environment. How are you, you know, how confident are you that you can take that without tipping retention in the wrong direction? Thanks. Thanks for question Ramsey. Yeah, you know, it's a great question because we always think really, really hard about pricing decisions and making sure that we don't get greedy. As we've shared on many occasions, what we're interested in is long-term clients and lifetime buy those clients.

Speaker Change: I Wonder if you could comment on how youre thinking about the balance striking a balance between pricing and retention and just sort of also speak to your confidence level about being able to take that 100 basis points of pricing, which I think is more than you took sort of pre pandemic, although less than you've been taking and that's really inflationary environment. How are you.

Speaker Change: How confident are you that you can take that without tipping retention in the wrong direction.

Don Edward McGuire: Thanks. Thanks for the question, Ramsey. Yeah, you know, it's a great question because we always think really, really hard about pricing decisions and making sure that we don't get greedy. As we've shared on many occasions, what we're interested in is long-term clients and the lifetime value of those clients. So we're always very, very careful not to over-react on price.

Speaker Change: Yeah. Thanks, Thanks for the question Ramsey, Yes, it's a great question, because we always think really really hard about pricing decisions and making sure that we don't get greedy as we've shared on many occasions, we're interested in us.

Speaker Change: Long term clients and the lifetime value of those clients. So we're always very very careful not to not overweighted on price and you are right we have been able to take.

Unknown Executive: So we're always very, very careful not to not to over rotate on price. And you're right. We have been able to take about 150 basis points in 23 and 24, and as we looked at 25 and we looked at the moderating inflation environment, we thought that Hunter basis points is realistic. If we go back pre-23 and back into the teens, we were more on the 50 basis points range, but the inflation environment was very, very different than it was virtually not existent. So we're confident that we can get 100 basis points. We're confident that we can target it in the right places.

Speaker Change: About 150 basis points in 'twenty, three and 'twenty four and as we looked at 25 and we looked at the moderating inflation environment, we thought that <unk>.

Don Edward McGuire: And you're right; we were able to take about 150 basis points in 23 and 24. And as we looked at 25, and we looked at the moderating inflation environment, we thought that 100 basis points was realistic. If we go back pre-23 and back into the teens, we were more in the 50 basis points range, but the inflation environment was very, very different then. Then it was virtually nonexistent.

Speaker Change: 100 basis points was realistic.

Speaker Change: If we go back pre 2003.

Speaker Change: Back into the teens, we were more in the 50 basis points range, but.

Speaker Change: The inflation environment with very very different than it was virtually nonexistent. So we're confident that we can get 100 basis points. We're confident that we can target it in the right places.

Don Edward McGuire: So we're confident that we can get 100 basis points. We're confident that we can target it in the right places. So it is something that we think is a reasonable expectation for us to target. Okay, and a follow-up question for me is about generative AI; talk about how we should think about the long-term kind of opportunity there in terms of monetization. Is this ever something that could happen? (inaudible) It's a great question.

Unknown Executive: So it is something that we think is a reasonable expectation for us to target.

Speaker Change: So it is something that we think is a reasonable expectation for us to target.

Unknown Executive: Okay. And follow up for me. It about generous.

Speaker Change: Okay.

Speaker Change: And a follow up from me is about generative AI and just if you could talk about how we should think about the long term kind of opportunity. There in terms of monetization is this something that could contribute to revenue directly or is this generally I sort of more something that will drive soft dollars to rich.

Unknown Executive: If you could talk about how we should think about the long term kind of opportunity there in terms of modernization, is this ever something that could contribute to revenue directly, or is this generally a sort of more something that will drive soft dollars to retention, new bookings? Obviously, there's an expense benefit internally, but I'm just curious about how you're framing it up over the long term. It's a great question. My answer to you would be both. And so, from a generative AI perspective, I know you; I know you know that I love to speak about it.

Speaker Change: Tension new bookings, obviously, theres a expense benefit internally, but im just curious about how you're framing it up over the long term.

Maria Black: My answer to you would be both. And so from a generative AI perspective, I know you, I know, you know that I love to speak about it. I talked about it again at length this morning during the prepared remarks, and what I would offer is that, all across, whether it's the focus we have on putting generative AI ADP assist across and into each one of our products, or it's the work that we're doing with putting AI ADP assist into the market to help practitioners, or help our own service associates, and our sales associates. The way I think about it, first and foremost, is exactly what you said and suggested, which is that it should feed the ADP model.

Speaker Change: It's a great question my answer to you would be both and so from a generative AI perspective, I know you I know you know that I love to add to speak about it I talked about it again at length. Just this morning during our prepared remarks.

Unknown Executive: I talked about it again at length, just this morning during the prepared remarks. What I would offer is that all across whether it's the focus we have of putting generative AI, ADP Assist across and into each one of our products, or it's the work that we're doing with putting ADP Assist into the market to help practitioners. Or help our own service associates and our sales associates. The way I think about it, first and foremost, is exactly what you suggested, which is it should feed the ADP model. And in its most simplistic form, and I think about this company and driving, you know, the recurring revenue model that we have, it's about sales, it's about retention, it's about product efficiency, and it's about NPS.

Speaker Change: Would offer is that all across whether it's the focus we have a putting generative AI ADP assessed across and into each one of our products.

Speaker Change: Or it's the work that we're doing but putting ADP assessed into the market to help practitioners.

Maria Black: And in its most simplistic form, and I think about this company and driving, you know, the recurring revenue model that we have, it's about sales, it's about retention, it's about product efficiency, and it's about NPS. And those four metrics, generative AI and everything that we're offering, as it relates to ADP assist, should feed, call it the machine of our model, right? So we should have more sales; we should be able to keep clients. Why?

Speaker Change: Or help our own service associates, and our sales associates the way I think about it first and foremost is exactly what you said you suggested which is it should feed the ADP model and in its most simplistic form and I think about this company and driving the.

Speaker Change: Recurring revenue model that we have it's about sales it's about retention, it's about product efficiency and it's about mpls and those four metrics generative AI in everything that we're offering.

Unknown Executive: And those form metrics, generative AI, and everything that we're offering as it relates to ADP Assist should feed, call it the machine of our model, right? So we should add more sales; we should be able to keep clients wide because they're happier and they have a better experience as it relates to NPS. And then, in turn, we also drive efficiency. So I think that's the output and the outcome of a lot of the investments we're making. That said, as we look at all the use cases and both the short term stuff that we're working on, as well as the long term vision of what ultimately generative AI could look like in the coming years, we do see its monetization opportunities.

Speaker Change: As it relates to ADP assessed should feed to call. It the machine of our model right. So we should have more sales, we should be able to keep clients why because they are happier and they had a better experience as it relates to M. P. S. And then in turn we also drive efficiency. So I think that's the output and the outcome of a lot of the investments, we're making that said as we.

Maria Black: Because they're happier, and they have a better experience as it relates to NPS. And then, in turn, we also drive efficiency. So I think that's the output and the outcome of a lot of the investments we're making. That said, as we look at all the use cases and both the short-term stuff that we're working on, as well as the long-term vision of what ultimately generative AI could look like in the coming years, we do see monetization opportunities.

Speaker Change: Look at all the use cases and both the short term stuff that we're working on as well as the long term vision, but ultimately generative AI could look like in the coming years, we do see it monetization opportunities.

Unknown Executive: And each one of our business cases, as you can imagine, has clear goals of what it is that we're trying to accomplish, inclusive of revenue growth.

Speaker Change: Each one of our business cases as you can imagine has clear goals of what it is that we're trying to accomplish inclusive of revenue growth I think it's too early to start sharing some of those broadly across the market, but certainly that's a big piece of our strategy as is making sure that we continue to drive the transformation type of opportunity.

Unknown Executive: I think it's too early to start sharing some of those broadly across the market, but certainly that's a big piece of our strategy, as is making sure that we continue to drive the transformation type of opportunities that we've been driving for years as a company. Fantastic.

Maria Black: And each one of our business cases, as you can imagine, has clear goals of what it is that we're trying to accomplish, inclusive of revenue growth. I think it's too early to start sharing some of those broadly across the market, But certainly, that's a big piece of our strategy, as is making sure that we continue to drive the transformational type of opportunities that we've been driving for years as a company. Thank you. Our next question comes from Samad Samana with Jeffreys. Your line is open. Hi, good morning.

Speaker Change: Is that we've been driving for years as a company.

Speaker Change: Fantastic. Thank you.

Samad Samana: Thank you. Our next question comes from Samad Samana with Jefferies. Your line is open. I get more than anything to take my questions. I may be one for you just on the PEO guidance, and I apologize if this question is kind of a dumb question, but I just want to make sure I understand it. If I look back last year, you had to say slightly better WSE assumption, and you got into it three to five percent, and this year you're assuming lower WSE growth, but actually slightly better revenue growth. And I was just trying to reconcile those two things.

Speaker Change: Thank you. Our next question comes from Samad Samana with Jefferies. Your line is open.

Samad Saleem Samana: Thanks for taking my questions. Don, maybe one for you just on the PEO guidance, and I apologize if this question is kind of a dumb question, but I just want to make sure I understood it. If I look back last year, you actually had a slightly better WSC assumption, and you guided to three to 5%. And this year, you're assuming lower WSC growth but actually slightly better revenue growth. And I was just trying to reconcile those two things. Are retention assumptions the big difference there? Or is there some other mechanical thing that makes easier comps?

Samad Saleem Samana: Hi, good morning, Thanks for taking my questions.

Samad Saleem Samana: One for you just on the PEO guidance.

Samad Saleem Samana: I apologize Nicole's question is kind of a dumb question, but I just want to make sure I understood. It if I look back last year, you had actually a slightly better WSB assumption in your guidance at 3% to 5% and this year are you, assuming lower ws knee growth, but actually slightly better revenue growth and I was just trying to reconcile those two things is.

Unknown Executive: Is retention assumptions the big difference there, or is there some other mechanical thing is easier comps than just trying to understand the PEO guidance to serve us. Yeah. No, Samad, it's a great question. So there are a few things happening. If you look forward to 25, revenue is growing, but the biggest contributor to the revenue growth is zero margin pathways. So that's the largest component, and that's what's happening there. And then, of course, we've mentioned earlier that pace per control is our under pressure. So, as I said in an earlier answer, when the 2% for ES and we think more towards the low end of that for the PEO area.

Speaker Change: Retention assumptions the big difference there or is there. Some other mechanical thing is easier comps I'm just trying to understand the guidance this year versus last year.

Don Edward McGuire: I'm just trying to understand the PEO guidance this year versus last. No, Samad, it's a great question. So there are a few things happening. If you look forward to 25, revenue is growing, but the biggest contributor to revenue growth is zero margin pass-throughs. So that's the largest component. And that's what's happening there.

Speaker Change: No some of it it's a great question. So there were a few things happening. If you look forward to 'twenty five revenue is growing but the biggest contributor to the revenue growth of zero margin pass throughs. So that's the largest component.

Don Edward McGuire: And then, of course, we've mentioned earlier that pays per control are under pressure. So, as I said in an earlier answer, one to 2% for ES, and we think more towards the low end of that for the PO area. And then we have a little bit of pressure from workers' compensation on the margin. And I guess the third thing is that we do continue to focus on the area to get sales reaccelerating.

Speaker Change: That's what's happening there and then of course, we mentioned earlier that pays per control is.

Speaker Change: Under pressure so as I said in an earlier answer 1% to 2% for Es and we think more towards the low end of that for the PEO.

Unknown Executive: And then we have a little bit of pressure from work with compensation on the margin. And I guess the third thing is we do continue to focus on the area to get sales reaccelerating. So we certainly have more selling expense baked in to that business to help drive the help drive the top line and make sure we get to continue to grow with the work site employees.

Samad Saleem Samana: <unk>.

Samad Saleem Samana: And then we have a little bit of pressure from workers' compensation on the margin.

Samad Saleem Samana: And I guess the third thing is we do continue to focus on the area to get sales re accelerating so we certainly have more selling expense baked in to.

Don Edward McGuire: So we certainly have more selling expense baked in to that business to help drive the top line and make sure we get to continue to grow with our worksite employees. And Maria, if I take just one huge step back, business is very strong right now, and it seems like that's happening against a backdrop that is slowing.

Samad Saleem Samana: To that business to help drive.

Samad Saleem Samana: I'll drive the topline.

Samad Saleem Samana: Make sure we get the continued growth in Worksite employees.

Unknown Executive: Understood. And Maria, if I take just one huge step back, the business is very strong right now, and it seems like that's happening in what is a backup that is slowing. And so I just was wondering, you know, you've been at ADP for a long time. You've seen multiple cycles. Can you just remind us that when you see a broader slowdown in the backdrop, just kind of how you still are able to drive value and what the performance of the businesses has historically been in these slowdown periods because I think we're all impressed by the durability of the strength even as things may be slow in the backdrop.

Maria Black: And so I just was wondering, you know, you've been at ADP for a long time, you've seen multiple cycles. Can you just remind us that when you see a broader slowdown in the backdrop, just kind of how you are still able to drive value and what the performance of the business has historically been? And these slowdown periods, because I think we're all impressed by the durability of strength, even as things may be slow in the back.

Samad Saleem Samana: Understood and Maria just one huge setbacks.

Speaker Change: The business is very strong right now and it seems like that's happening in what is a brand that is slowing.

Speaker Change: I just was wondering you've been at ADP for a long time and seen multiple cycles can you just remind us that when you see a broader slowdown in the backdrop just kind of how you still are able to drive value and what the performance of the businesses has historically been in the slowdown periods because I think we're all impressed by that.

Speaker Change: The durability of the strength, even as things may be slowing the backdrop.

Maria Black: Yeah, thanks, Samad, and you're right. I think the durability of what it is that we offer; I spoke to it a bit earlier in terms of the imperative of H.C.M. I think that durability also lends itself to a different environment should the macro change. So the fails force of ADP, if you will, are offering is great in times of growth. It's great in times of steady, and it's also great as a conduit, as there might be pressure in the employer environment. And so the value proposition, we have a playbook; we can adjust very, very quickly in terms of what it is that we offer and the demand environment as the demand environment shifts.

Maria Black: Yeah, thanks, Samad. And you're right. I think the durability of what it is that we offer, I spoke to it a bit earlier in terms of the imperative of HCM. I think that durability also lends itself to a different environment, should the macro environment change. So the sales But if it does end up getting impacted, one of the things that does end up getting impacted is bookings. But at the same time, you know, from a standpoint of the self-adjustment of that value proposition, it is very durable, and it is very durable as a result of HCM being an imperative.

Speaker Change: Yeah, Thanks, Ahmad and Youre right I think the durability of what it is that we offer I spoke to it a bit earlier in terms of the imperative of HCM I think that durability also lends itself to a different environment should the macro change.

Speaker Change: So the sales.

Speaker Change: The force of ADP, if you will our offering is great in times of growth that's great in times of steady and it's also great.

Speaker Change: As a conduit as there might be pressure in the employer environment and so the value proposition. We have a playbook. We can adjust very very quickly in terms of what it is that we offer and the demand environment as the demand environment shifts now that said you know should there be a huge decline in the macro of course.

Don McGuire: Now that said, you know, should there be a huge decline in the macro, of course, we will be impacted. One of the things that does I'm not getting impacted is bookings, but at the same time, you know, from the standpoint of the self-adjustment of that value proposition. It is very durable, and it is very durable as a result of H.C.M. being an imperative. And so we feel good about our ability to flex, and I've seen that, to your point, Samad, I've been here a long time as a student of ADP's great distribution, and I've seen that flex over time, and I have all the confidence that the team would do the same.

Maria Black: And so we feel good about our ability to flex. And I've seen that, to your point, Samad, I've been here a long time as a student of ADP's great distribution, and I've seen that flex over time. And I have all the confidence that the team will do the same.

Speaker Change: We will be impacted one of the things that does end up getting impacted as bookings, but at the same time from the standpoint of the self adjustment of that value proposition is very durable and it is very durable as a result of HCM being an imperative and so we feel good about our ability to flex and I've seen that to your point some I've been here a long time.

Speaker Change: As a student of Adp's, great distribution, and I've seen that flex overtime and have all the confidence that the team would do the same I think maybe Don could also talk about the how that financial model should something shifts in the market. The financial model also self adjust as it relates to the the playbook.

Unknown Executive: I think maybe Don could also talk about the how that financial model, you know, should something shift in the market. The financial model also self adjusts as it relates to the playbook, if you will, in a different macro. Yeah, certainly we've talked about this before, but if we go back, if we go back a year, so I think, or maybe 18 months, the word recession was on people's lips a lot more frequently than it is today. And I think the latest survey I've seen says that there's about a 28% probability of recession in the next 12 months.

Maria Black: And I think maybe Don could also talk about how that financial model, you know, should something shift in the market, the financial model also self-adjusts as it relates to the playbook, if you will, in a different macro. Yeah, certainly. We've talked about this before. And but if we go back, if we go back a year or so, I think, or maybe 18 months, the word recession was on people's lips a lot more frequently than it is today.

Speaker Change: Willing to different macro.

Don Edward McGuire: And I think the latest survey I've seen says that there's about a 28% probability of recession in the next 12 months. I'm sure that's something the rest of you have read somewhere as well. So the good news is it looks very unlikely that we're going to have a recession over the next 12 months.

Speaker Change: Yes, certainly we've talked about this before but if we go back if we go back a year or so I think.

Speaker Change: 18 months the word recession was on People's Lips, a lot more frequently than it is today and I think the latest survey I've seen says that.

Speaker Change: There is about a 28% probability of recession in the next 12 months.

Don McGuire: I'm sure that some survey that the rest of you have read somewhere as well. So the good news is it looks very unlikely that we're going to have a recession over the next 12 months. But certainly, as an old weather company, what we do isn't discretionary. You have to do it. The levers we have, if sales slow, commissions slow; if implementation slow, we don't need as much headcount, et cetera, et cetera. But I think, as we saw in 2008, it took a long time for ADP to find itself in a place that looked like a lot of adjustment.

Speaker Change: So I'm sure that some.

Speaker Change: Survey that the rest of you have read somewhere as well so the good news is it looks very unlikely.

Speaker Change: We're going to have a recession over the next 12 months, but certainly as an all weather company. What we do isn't discretionary you have to do it.

Don Edward McGuire: But certainly, as an all-weather company, what we do isn't discretionary; you have to do it. The levers we have, if sales slow, commissions slow, if implementation is slow, we don't need as much headcount, etc., etc. But I think, as we saw in 2008, it took a long time for ADP to find itself in a place that looked like a lot of adjustment. So we think that we can use those tools again, should we need to. But I'll just finish with, hopefully, that survey is correct. And nobody's thinking about a recession in the next 12 months. Appreciate the time, as always; have a good day.

Speaker Change: <unk>, we have if sales slow commissions slow implementation slow we don't need as much head count et cetera, et cetera, but I think as we saw in 2008. It took a long time for ADP to find itself in a place that looked like a lot of adjustment. So we think that we can use those tools again should we need to but I'll just finish with <unk>.

Unknown Executive: So we think that we can use those tools again. Should we need to, but I'll just finish with hopefully that survey is correct and nobody's thinking about a recession in the next 12 months.

Speaker Change: That survey is correct and nobody is thinking about a recession in the next 12 months.

Speaker Change: Great I appreciate the kind of dollars every day. Thank you.

Mark Marcon: Thank you. Our next question comes from Mark Marcon with Baird. Your line is open. Hey, good morning, and thanks for taking my question. Congrats on the strong bookings in the fourth quarter as well as the really strong retention. I wanted to dive a little bit deeper into both with regards to the strong bookings. Maria, you cited, you know, on the small business side, run doing extremely well, getting 50,000 new clients. Can you talk a little bit about what the source of those clients is? Were those clients that were using competitive solutions, or are they brand new business formations?

Speaker Change: Okay.

Mark Steven Marcon: Thank you. Our next question comes from Mark Marcon with Baird. Your line is, Hey, good morning and thanks for taking. Congratulations on the strong bookings in the fourth quarter as well as the really strong. I wanted to dive a little bit deeper into both.

Speaker Change: Thank you. Our next question comes from Mark Marcon with Baird. Your line is open.

Mark Steven Marcon: Hey, good morning, and thanks for taking my questions. Congrats on the strong bookings in the fourth quarter as well as the really strong retention I wanted to do.

Maria Black: With regard to the strong bookings, Maria, you cited, you know, on the small business side, RUN doing extremely well, getting 50,000 new clients. Can you talk a little bit about what the source of those clients are, or those clients that were using competitive solutions, or are they brand new business formations? How would you characterize that?

Mark Steven Marcon: Dive a little bit deeper into both with regards to the strong bookings Maria you sited.

Maria: On the small business side run doing extremely well getting 50000, new clients can you talk a little bit about what the source of those clients are those clients that were using competitive solutions with a brand new.

Speaker Change: Business formations, how would you characterize that where are you seeing the strength.

Unknown Executive: How would you characterize that? Where are you seeing the strength and the takeaways from? Sure. So on the, on the down market specifically as it relates to bookings, the bookings again are broad-based, right? So, where are we getting them? We're getting them from digital and bound. We're getting them from new businesses. We are getting them through the ecosystem of our channels, so clients that are engaging with banks, CPAs. Again, we canvas the entire market. That said, some of the things that we have seen mark year on year, new business formations, it's still at an elevated rate, but it is pressurized.

Speaker Change: And the takeaways from.

Maria Black: Where are you seeing the strength and the takeaway? Sure. So on the down market, specifically, as it relates to bookings, the bookings, again, are broad-based, right? So where are we getting them? We're getting them from digital inbound, we're getting them from new businesses, we are getting them through the ecosystem of our channels. So clients that are engaging with banks, CPAs, again, we canvas the entire market. That said, some of the things that we have seen, Mark, year on year, new business formations, it's still at an elevated rate, but it is pressurized. So sorry, year on year, it's minus based, but there are a tiny bit of shifts within that to answer your question specifically.

Speaker Change: Sure so on the on the down market, specifically as it relates to bookings.

Speaker Change: Bookings again, our broad based strength, so where are we getting them, we're getting them from digital inbound we're getting them from new businesses, we are getting them through the ecosystem of our channels. So clients that are engaging with bank CPA again, we canvass the entire market that said some of the things that we have seen mark.

Stu: Year on year, new business formations, it's Stu.

Speaker Change: <unk> at an elevated rate, but it is a pressurized so sorry year on year, it's minus three but it's still elevated compared to norms and so as a result of that we did see less coming this time from new business formations now we had a lot come from new business formation, but we also saw an increase in balance of trade some more.

Unknown Executive: So sorry, year on year, it's minus three, but it's still elevated compared to norms. And so, as a result of that, we did see less coming this time from new business formations. Now we had a lot come from new business formations, but we also saw an increase in balance of trade, some more coming from the competition. So what I would say is, you know, the mix shifted a little bit in terms of how we broadly canvas the down market. All that rolled up to this incredible result of 50,000 units in the fourth quarter. So it's broad base, but there are tiny bit of shifts within that to answer your question specifically.

Speaker Change: Coming from the competition. So what I would say is you know the mix shifted a little bit in terms of how we broadly canvass the down market all of that rolled up to this incredible result of 50000 units in the fourth quarter. So it's broad based but there are a tiny bit of shifts with and not to answer your question specifically.

Unknown Executive: Right. And then on next gen HCM, you also mentioned, you know, 50% pickup there in terms of new sales. And this is before you're fully, you know, GA. Can you talk a little bit about what the source of the winds are in terms of, are these clients that are transitioning from older ADP platforms, or are they coming from competitors? And if it's from competitors, what sort of competitors? Sure, the answer is both and also had to head against competition. So some of them are ADP upgrades. We did see more new logos, and we've seen before.

Maria Black: And then on next gen HCM, you also mentioned, you know, 50% pickup there in terms of new sales. And this is before you're fully, you know, GA. Can you talk a little bit about what the source of the wins is in terms of are these clients that are transitioning from older ADP platforms? Or are they coming from competitors? And if it's from competitors, what sort of competitors? Sure, the answer is both. And also, head to head against competition.

Speaker Change: Great and then on next Gen. HCM you also mentioned.

Speaker Change: 50% pick up there in terms of new sales.

Speaker Change: Before.

Stu: Fully.

Speaker Change: G E.

Speaker Change: Can you talk a little bit about what the source of the wins are in terms of are these clients.

Speaker Change: We are transitioning from older ADP platforms or are they coming from.

Stu: Competitors.

Stu: If it's from competitors, what's sort of competitors.

Maria Black: So some of them are ADP upgrades; we did see more new logos than we've seen before. So we're really excited about the net new wins for ADP. Some of those were wins and takeaways from enterprise competitors. Some of them were wins head to head against the same enterprise competitors, which again, is probably why I'm so optimistic about it because it appears that the offer that we have is competing incredibly well in the market, and clients are choosing ADM. That's great. And then with regard to client retention, I know you're guiding prudently for normalization, but it seems like your client satisfaction scores continue to trend upward. How would you do that?

Speaker Change: Sure the answer is both and also.

Speaker Change #102: To head against competition. So some of them are ADP upgrades, we did see more new.

Speaker Change: New logos than we've seen before so we're really excited about the net new wins to ADP. Some of those were wins and takeaways from enterprise.

Unknown Executive: So we're really excited about the net new winds to ADP. Some of those were winds and takeaways from enterprise competitors. Some of them were winds head to head against the same said enterprise competitors, which again is probably why I'm so optimistic about it, because it appears that the offer that we have is competing incredibly well in the market and clients are choosing ADP. That's great. And then, with regards to client retention, I know you're guiding prudently for normalization, but it seems like your client satisfaction scores continue to trend up. How would you, how would you characterize the primary drivers of the improved client satisfaction?

Speaker Change: Competitors some of them were wins head to head against the same said enterprise competitors.

Speaker Change: Again, it's probably why I'm, so optimistic about it because it's it appears that the offer that we have is competing incredibly well in the market and clients are choosing ADP.

Speaker Change: That's great and then with regards to client retention.

Speaker Change: Youre guiding prudently for a normalization, but it seems like you are.

Speaker Change: Client satisfaction scores continue to trend up.

Maria Black: How would you characterize the primary drivers of the improved client satisfaction? Is it the solution set? Or is it the service underlying, or a combination of both? It's a combination of both. NPS is fantastic. So NPS for the quarter as well as the full year was a record. Almost every single business is at a record NPS. So what drives NPS? Is it that both, right?

Speaker Change: How would you.

Speaker Change: How would you characterize the primary drivers of the improved client satisfaction is it is it the solution set or is it the service underlying or a combination of both.

Unknown Executive: Is it, is it the solution set or is it the service underlying, or a combination of? Both. It's a combination of both. NPS is fantastic. So NPS for the quarter, as well as the full year, was a record; almost every single business is at a record NPS. So what drives NPS. It is that both right. So it is the investments we've made into our best and class products. And this is years that we've been making these investments and making our products newer and more modern, taking friction out, making them more self service. All of these things that go into having best and class HPM technology, those investments coupled with best and class service is driving the broad NPS record that we have across the business.

Maria Black: So it is the investments we've made in our best-in-class products, and also because we are executing at all-time highs almost across every single business, we just want to be thoughtful as we step into the year to make sure that the retention guide is prudent. Thank you. Thank you. Thank you.

Speaker Change: It's a combination of both our NPS is fantastic so NPS for the quarter as well as the full year was a record almost every single business is at a record NPS. So what drives NPS. It is that both right. So it is the investments we've made into our best in class products and this is.

Speaker Change: Years that we've been making these investments and making our products are newer and more modern taking friction out making them more self service all of these things that go into having best in class HCM technology those investments coupled with best in class service is driving.

Speaker Change: The broad NPS record that we have across the business.

Unknown Executive: So it's such that is a direct core later to record retention. And so we're we're really proud of the 92% your right. We're prudently guiding into the year again. And you know the reason behind that, as you know we've had this conversation many times, is that there is still perhaps some normalization that could happen. And also because we are executing at all time highs almost across every single business. We just want to be thoughtful as we step into the year to make sure that the retention guide is prudent. Thank you.

Speaker Change: So as such that is a direct correlate to a record retention and so where we're really proud of the 92% you're right.

Speaker Change: Prudently guiding into the year again, and the reason behind that is as you as you know we've had this conversation. Many times is that there is still perhaps some normalization that could happen and also because we are executing at all time highs almost across every single business. We just want to be thoughtful as we set.

Speaker Change: And for the year to make sure that the the retention guide is prudent.

Speaker Change: Got it thank you.

Speaker Change: Thank you.

Speaker Change: Okay.

Speaker Change: Thank you. Our next question comes from Tien Tsin Huang with Jpmorgan. Your line is open.

Tinjin Hoang: Our next question comes from Tinjin Hoang with JP Morgan. Your line is open. Hey, perfect. Just want to extend on the retention, but more on the outlook side. If that's okay. Just any call us expectation wise across the segments, small, mid, and large. I know you've commented on balance the trade already. But I didn't know if you're seeing anything different in terms of expectations on retention. Yeah, fair.

Tianjin Huang: Hey, perfect, just wanted to extend on retention, but more on the outlook side, if that's okay. Just any call-outs expectation-wise across the segment, small, mid? In large part, I know you've commented on the balance of trade already, but I didn't know if you're seeing anything different in terms of expectations for retention. Yeah, fair. What I would offer is the same reason that we guided into the year this year the way that we did this year that we just closed, potential normalization in the down market. Now, I've been saying that for the last couple years. Yeah, I know the down market isn't entirely normalized back to where it was pre-pandemic. Now, I get that that's five years ago.

Speaker Change: Okay, perfect just to extend on the retention, but more on the outlook side. If that's okay, just any call outs expectation wise across the segments small mid.

Speaker Change: And large I know you've commented on balance of trade already but didn't know if you're seeing anything different in terms of expectations on retention.

Speaker Change: Yeah. There are what I would offer is it's the same reason that we guided into the year. This year. The way that we did this year that we just closed thats its expected potential normalization in the down market now.

Unknown Executive: What I would offer is it's the same reason that we guided into the year this year, the way that we did this year that we just close. It's expected potential normalization in the down market now. I've been saying that for the last couple of years, isn't it? Yeah, I know the down market isn't entirely normalized back to where it was pre-pandemic now. I guess that that's five years ago, and at maybe at some point I we all have to just suggest that it's the new normal. But we haven't seen an uptick in bankruptcy is out of business at the levels that we used to see in that business, and it's such we believe it's prudent that there could still be some of that normalization.

Speaker Change #105: I've been saying that for the last couple of years isn't yeah, I know the other downmarket isn't entirely normalized back to where it was pre pandemic now I get that that's five years ago and it may be at some point, we all have to just suggest that it's the new normal.

Maria Black: And it may be that at some point, we all have to just suggest that this is the new normal. But we haven't seen an uptick in bankruptcies out of business at the levels that we used to see in that business. And as such, we believe it's prudent that there could still be some of that normalization. So it's really, it's really the same thing that we've been suggesting. It just hasn't

Speaker Change: But we haven't seen an uptick in bankruptcies out of business at the levels that we used to see in that business and as such we believe it's prudent that there could still be some of that normalization. So it's really it's really the same thing that we've been suggesting it just hasnt happened yet and our goal would be of course to not have it happen again.

Unknown Executive: So it's really the same thing that we've been suggesting; it just hasn't happened yet, and our goal would be, of course, to not have it happen again. Yeah, and you did outperform obviously the guys you said last year this time. So, okay, not just wanted to check. I think this again you've said prudent and totally agree with that. Just my quick follow-up just is on the margin front at that. I know it's very typical margin expansion. I think you you did call it last quarter, maybe a little bit more investment in JNI.

Maria Black: And our goal would be, of course, to not have it happen again. And you did outperform, obviously, the guys you set last year at this time. So, okay. No, I just wanted to check.

Speaker Change: Yes, you did outperform obviously the guidance you said last year at this time. So I just wanted to check I think again, you've said prudent and totally agree with that just my quick follow up just is on the margin front I know it's very.

Don Edward McGuire: I think this, again, you've set a prudent and totally agree with that. Just my quick follow-up, just as on the margin front, I know it's very typical margin expansion. I think you did call it last quarter, maybe a little bit more investment in JNAI.

Speaker Change: Very typical.

Speaker Change: Margin expansion.

Speaker Change: You did call out last quarter, maybe a little bit more investment and Jamie.

Unknown Executive: Anything different in terms of incremental margin outlook for fiscal 25. It does look like you have a workforce rebalancing in the fourth quarter as well. So just want to make sure we call it puts and takes there on the margin front. Thank you. Yeah, so Titian, thanks for the question. I think that, you know, we're always I'll start with where you ended there. We're always looking at the workforce and making sure we're. We've got the right people in the right places and the right numbers of people in the right places. So I was looking at that.

Don Edward McGuire: Anything different in terms of the incremental margin outlook for fiscal 25? It does look like you have a workforce rebalancing in the fourth quarter as well, so just wanna make sure we call it puts and takes there on the margin front. Thank you.

Speaker Change #109: Being different in terms of incremental margin outlook for fiscal 2005. It does look like you have a workforce rebalancing in the fourth quarter as well so just want to make sure we call. It the puts and takes there on the margin front. Thank you.

Don Edward McGuire: Thanks for the question. I think that, you know, we're always I'll start with where you ended there. We're always looking at the workforce and making sure we've got the right people in the right places and the right numbers of people in the right places. So we're always looking at that. I don't think there's any real, you know, specific call outs on the margin. I think that, you know, there are some Gen AI investments, these are modest, but they do attract, you know, 1020 bips here and there, so to speak, but they are modest, all things considered.

Speaker Change #104: Yes, so tien tsin. Thanks for the question I think that we're always I'll start with where you ended there. We're always looking at the work force and making sure. We're we've got the right people in the right places and the right numbers of people in the right places. So we're always looking at that I don't think theres any room.

Unknown Executive: I don't think there's any real, you know, specific callouts on the margin. I think that you know there are some genuine investments. These are modest, but they do. They do attract, you know, 10, 20 dips here and there. So to speak, but they are modest. All things considered. Certainly the margin next year, we can a little bit of pressure from lower, from lower pace per control, from lower pricing increases and from lower. Lower client front interest specifically, most specifically in the back half, but I think those are all things that we've called out and you can read through.

Speaker Change: Specific callouts.

Speaker Change: On the margin I think that.

Speaker Change: There are some journey our investments these are modest but they do they do attract 10 to 20 bps here and there so to speak but they are a modest all things considered.

Don Edward McGuire: Certainly, the margin next year, we get a little bit of pressure from lower, lower pays per control, from lower pricing increases, and from lower, lower client fund interest specifically, most specifically in the back half. But I think those are all things that we've called out and you can read through so nothing, nothing normal. Yeah, no, glad to see it's typical and congratulations to Danny and Matt as well.

Speaker Change: Certainly the margin next year, we'd get a little bit of pressure from lower.

Speaker Change: From your pays per control from lower pricing increases and from lower.

Speaker Change: Lower client fund interest specifically, most specifically in the back half, but I think those are all things that we've called out and you can read through so nothing.

Unknown Executive: So nothing, nothing of normal. Yeah, not quite as it's typical, and congrats to Danny and Matt as well.

Speaker Change: Nothing abnormal.

Speaker Change: Yes, no glad to see it's typical and congrats to Daniel as well thanks guys.

Unknown Executive: Thanks, Gus. Thank you.

Bryan Connell Keane: Thank you. Our next question comes from Bryan Keane with Deutsche Bank. Your line is open.

Speaker Change: Thank you. Our next question comes from Bryan Keane with Deutsche Bank. Your line is open.

Bryan Keane: Our next question comes from Bryan Keane with Deutsche Bank. Your line is open. Hi guys, congrats on the quarter, really strong in ES. On PEO, the booking work, celebrating and recovering in fiscal year 24, but moderated towards the end of the fiscal year. So just want to understand any change in the marketplace there.

Maria Black: Hi guys, congrats on the quarter, really strong in ES. On TEO, the bookings were accelerating and recovering in fiscal year 24, but they moderated towards the end of the fiscal year. So just want to understand what changed in the marketplace. Sure. Good morning.

Bryan Connell Keane: Hi, guys congrats on the quarter really strong in Es on GE.

Bryan Connell Keane: The bookings were accelerating and recovering in fiscal year, 'twenty, four but moderated towards the end of the fiscal year. So just want to understand what changed in the marketplace. There.

Unknown Executive: Sure, good morning. And thank you, by the way, appreciate the congrats. PEO bookings did moderate a bit in the back half. And from a year-on-year perspective, it did moderate as well. That said, there was still strong growth in PEO bookings. And so, you know, from my vantage point, the demand equation is still incredibly strong for the PEO. It was a, you know, slight moderation year on year. We feel really solid about the demand for the offer, the value proposition of the offer. And we feel solid about pipelines and the PEO. And as you know, with pipelines and the PEO, it's more about activity in the market, new appointments, requests for proposals, things of that nature.

Maria Black: And thank you, by the way; I appreciate the congrats. PEO bookings did moderate a bit in the back half. And from a year on year perspective, it did moderate as well. That said, there was still strong growth in PEO bookings. And so, you know, from my vantage point, the demand equation is still incredibly strong for the PEO. It was, you know, slight moderation year on year, but we feel really solid about the demand for the offer, the value proposition of the offer, and we feel solid about pipelines in the PEO.

Speaker Change: Sure Good morning, and thank you by the way I appreciate the the congrats PEO bookings did moderate a bit in the back half.

Speaker Change #108: And from a year on year perspective, it did moderate as well that said there was still strong growth in PEO bookings and so from my vantage point the demand equation is still incredibly strong for the PEO.

Speaker Change: It was a.

Speaker Change: Light moderation year on year, we feel really solid about the demand for the offer the value proposition of the offer and we feel solid about pipelines and the PEO and as you know with pipelines in the PEO, it's more about activity in the market a new appointment requests for proposals things of that nature. So all the bellwether signals show that the PEO strength.

Maria Black: And as you know, with pipelines in the PEO, it's more about activity in the market, new appointments, requests for proposals, things of that nature. So all the bellwether signals show that the PEO strength is still there, but it did moderate a bit in the back. Yeah, and just to follow up just with thinking, you know, what would it take to get PEO back to high single-digit or double-digit revenue growth that was targeted previously. Yeah, I think it's going to take a little bit of time.

Unknown Executive: So all the bellwether signals show that the PEO strength is still there, but it did moderate a bit in the back half.

Speaker Change: It's still there, but it did moderate a bit in the back half.

Unknown Executive: Yeah, just to follow up, just with thinking, what would it take to get PEO back to high single-digit or double-digit revenue growth that was targeted previously? Yeah, I think it's going to take a little bit of time. And we were working, and as I mentioned earlier, we're seeing some more margin pressure in PEO. And some of that is because of the investments we're making in the sales force to make sure we can get those bookings going. But realistically, to get to kind of investor day guidance, we provided three years ago, it's going to take some time to build that back.

Speaker Change #100: Yes, just a follow up just thinking.

Speaker Change #101: What would it take to get PEO back to high single digit or double digit revenue growth what was targeted previously.

Maria Black: And we're working, and as I mentioned earlier, we're seeing some more margin pressure in PEO. And some of that is because of the investments we're making in the sales force to make sure we can get those bookings going. But realistically, to get to kind of the investor day guidance that we provided three years ago, it's going to take some time to build that back. So we're definitely focused on that.

Speaker Change #101: Yes, Brian I think it's going to take a little bit of time, maybe we're working on as I mentioned earlier, we're seeing some more margin.

Speaker Change #101: Margin pressure in PEO and some of that is because of the investments we're making in the sales force to make sure. We can get those bookings going but realistically to get to kind of investor day guidance that we provided three years ago, it's going to take some time to build that back. So we're definitely focused on that and we're definitely focused on getting there of course, if we were to see some <unk>.

Unknown Executive: So we're definitely focused on that. And we're both definitely focused on getting there. Of course, if we were to see some re-acceleration in the pace for control, that would put lots of wind in the sales, but it's going to take a little bit of time to get back to where we want to be. Now that makes sense, and congrats again.

Speaker Change: Celebration and the pace per control that would.

Maria Black: And we're definitely focused on getting there. Of course, if we were to see some reacceleration in the pay per control, that would put lots of wind in the sails, but it's going to take a little bit of time to get back to where we want to be.

Speaker Change: Put lots of wind in the sales, but it's going to take a little bit of time to get back to where we where we want to be.

Bryan Connell Keane: And congratulations again. Thank you. Thank you. Our next question comes from Scott Wurtzel with Wolf Research. Your line is open.

Speaker Change #111: No that makes sense and congrats again.

Scott Wurtzel: Thank you. Our next question comes from Scott Whartle with Wolf Research. Your line is open. Hey, good morning, guys. Thank you for taking my questions. I wanted to go back to the margin guidance and just the context of seems like slower expansion. The first half for a second half, wondering if you could maybe walk us through the drivers there. Is that more on the shape of revenue, or does it have anything to do on the cost side? Thank you. No, it's a good question. Good question.

Speaker Change #106: Thank you.

Speaker Change #106: Thank you. Our next question comes from Scott <unk> with Wolfe Research. Your line is open.

Scott Darren Wurtzel: Hey, good morning, guys. Thank you for taking my questions. I wanted to go back to the margin guidance and just the context of what seems like slower expansion, the first half or second half. Wondering if you could, you know, maybe walk us through the drivers there.

Scott: Hey, good morning, guys. Thank you for taking my questions I wanted to go back to the margin guidance and just the <unk>.

Scott: Context seems like slower expansion in the first half versus second half wondering if you could maybe walk us through the drivers there is that more on the shape of revenue or it doesn't have anything to do on the cost side. Thank you.

Don Edward McGuire: Is that more in the shape of revenue, or does it not have anything to do with the cost side? No, it's a good question. Good question, Scott. More on the shape of expenses. Revenue expectations throughout the year are pretty consistent quarter to quarter. It's really some spending patterns we have in the first half of the year, but really nothing specific to call out. Just want to give folks a heads up that we think we're going to be stronger in the back half than in the first.

Scott: Good question. Good question, Scott more on the shape of expenses.

Unknown Executive: Scott, more on the shape of expenses. Revenue expectations throughout the year are pretty consistent. Quarter to quarter. It's really some spending patterns we have in the first half of the year, but really nothing specific to call out. Just want to give folks a heads up that we think we're going to be stronger in the back half in the first. That makes sense. And just as a follow-up on the international side, it seems like you're making some good traction on incremental countries and geographies. And we love to just kind of hear about your expectations for international heading into this year.

Scott: Revenue expectations throughout the year are pretty consistent quarter to quarter, it's really some spending patterns. We have in the first half of the year, but really nothing specific to call out.

Scott: Just wanted to give folks a heads up that we think we're going to be stronger in the back half than the first.

Maria Black: That makes sense. And just as a follow-up on the international side, I mean, it seems like you're, you know, making some good traction on, you know, incremental countries and geographies. And we'd love to just kind of hear, you know, about your sort of expectations for international business heading into this year, how much of it is a priority for you relative to maybe other investments in the business and where you're maybe seeing opportunities internationally. Yeah, fair, Scott, it is a very large priority for us. As you may remember, our third strategic priority is to benefit our clients with our global scale; international fits squarely into that strategic priority.

Speaker Change #107: Got it that makes sense and just as a follow up on the on the international side I mean, it seems like Youre, making some good traction on incremental countries and geographies I would love to just kind of hear about your sort of expectations for international heading into this year how much of it is a priority for you relative to maybe other investments in the business and where you're maybe seeing opportunities internationally.

Unknown Executive: How much of it is a priority for you relative to maybe other investments in the business, and where you're maybe seeing opportunities internationally? Yeah, fair Scott. It is a very large priority for us. As you may remember, our third strategic priority is to benefit our clients with our global scale. International fits squarely into that strategic priority. We've been building this business for 50 some odd years. We are well ahead of the competition as it relates to the number of countries that we serve on behalf of our clients, and moreover, the infrastructure in those countries that we built out.

Speaker Change #120: Yeah Fair Scott It is a very large priority for us.

Speaker Change #115: As you May remember, our third strategic priority is to benefit our clients with our global scale international fits squarely into that strategic priority. We've been building. This business for 50. Some odd years, we are well ahead of the competition as it relates to the number of countries that we serve on behalf of our clients and Moreover, the infrastructure in those countries.

Maria Black: We've been building this business for 50 odd years, and we are well ahead of the competition as it relates to the number of countries that we serve on behalf of our clients and, moreover, the infrastructure in those countries that we have built out. So we often speak about the final mile and all the things that we do to ensure that our clients have the ability to pay across very complex, sometimes large, complex clients or countries, and sometimes very small, complex countries.

Speaker Change: And stuff, we built out so we often speak to the the final mile and all the things that we do to ensure that our clients have the ability to pay across very complex.

Unknown Executive: We often speak to the final mile and all the things that we do to ensure that our clients have the ability to pay across very complex, sometimes large, complex clients or countries, and sometimes very small, complex countries. But certainly, it's a big piece of our offer. I think companies continue to want to think about their system of record from a global perspective as they continue to have distributed workforces across the globe, as they continue to move supply chains in this world of globalization, as they have remote employees in smaller countries and around the world. We have this incredible network and ability to support clients today in what is 141 countries, and we continue to add more as they become prudent in terms of the what again if it's the growth economies or where our clients are heading.

Speaker Change: The times of large complex clients are countries with sometimes very small complex countries.

Speaker Change: But certainly it's a big piece of our offer I think.

Maria Black: But certainly, it's a big piece of our offer. I think, you know, companies continue to want to think about their system of record from a global perspective, as they continue to have distributed workforces across the globe, as they continue to move supply chains in this world of globalization, as they have remote employees in smaller countries and around the world. We have this incredible network and ability to support clients today in what is 141 countries, and we continue to add more as they become prudent in terms of the what, again, if it's the growth economies or where clients are heading.

Speaker Change: Companies continue to want to.

Speaker Change: Think about their system of record from a global perspective as they continue to have distributed workforces across the globe as they continue to move supply chains.

Speaker Change: In this world of globalization as they have remote employees and smaller countries and around the world. We have this incredible network and ability to support clients today in what is 141 countries and we continue to add more.

Speaker Change: They become prudent in terms of the again, if it's the growth economies of where our clients are heading but it's a big piece of our growth story, its a big piece of our differentiation in the marketplace and our multi country.

Maria Black: But it's a big piece of our growth story. It's a big piece of our differentiation in the marketplace, and our multi-country MNC business is a clear competitive advantage for us in the international space. Great, thank you.

Unknown Executive: But it's a big piece of our growth story. It's a big piece of our differentiation in the marketplace, and our multi-country MNC business is a clear competitive advantage for us in the international space. Thank you.

Speaker Change: And then C business is a clear competitor a competitive advantage for us in the international space.

Speaker Change #110: Great. Thank you.

Jason Alan Kupferberg: Thank you. Our next question comes from Jason Kupferberg with Bank of America. Your line is open. Hi, this is Caroline on behalf of Jason.

Speaker Change #116: Thank you. Our next question comes from Jason Kupferberg with Bank of America. Your line is open.

Caroline Latta: Our next question comes from Jason Kupferberg with Bank of America. Your line is open. Hi, this is Caroline on for Jason. Thanks for taking your question. Can you talk about the duration of the float portfolio? We were a little surprised to see that the F-25 average yield is expected to be up year over year, based on the number of rate cuts being forecast and maybe how you might be adjusting your investment strategy for the portfolio based on the interest rate outlook. What's the next 12 months?

Caroline Noelle Latta: Thanks for taking your question. Can you talk about the duration of the float portfolio? We were a little surprised to see that the F25 average yield is expected to be up year over year based on the number of rate cuts being forecast, and maybe how you might be adjusting your investment strategy for the portfolio based on the interest rate outlook for the next 12 months. Caroline, thanks for the question. So we know we do have a laddered strategy.

Speaker Change #116: Hi, This is Caroline on for Jason. Thanks for taking my question can you talk about the duration of the float portfolio, we were a little surprised to see that.

Speaker Change #117: 25 average yield is expected to be up year over year based on the number of rate cuts being forecast.

Speaker Change #119: And maybe how you might be adjusting your investment strategy for the portfolio based on the interest rate outlook for the next 12 months.

Unknown Executive: Caroline, thanks for the question. So we know we do have a laddered strategy. So if you, if you actually refer to the, I think the last page of the earnings release, I think you can see the maturity schedule for our investments. And you can see that, for example, in 25, we have $6 billion. It's maturing at roughly 2.2%. And our reinvestment at this point in time is 4.2%. So there's still lots of opportunity. And this is a place where ADP's laddering strategy shows its strength. It's fair to say that over the last couple of years, because of the inverted yield curve, we did have some opportunity cost by having this strategy.

Caroline Noelle Latta: So if you actually refer to the, I think the last page of the earnings release, I think you can see the maturity schedule for our investments. And you can see that, for example, in 25, we have $6 billion; it's maturing at roughly 2.2%. And our reinvestment rate at this point in time is 4.2%. So there's still lots of opportunity. And this is a place where ADP's laddering strategy shows its strength. It's fair to say that over the last couple of years, because of the inverted yield curve, we did have some opportunity cost by having this strategy.

Speaker Change #121: Caroline Thanks for the question so.

Speaker Change #114: We do have a ladder strategy. So if you if you actually referred to the eye.

Speaker Change #112: I think the last page of the earnings release, I think you can see the maturity schedule for our investments and you can see that for example in 'twenty five we have $6 billion, that's maturing at roughly two 2% and our reinvestment at this point in time is four 2%. So there's still lots of opportunity and this is a place where a.

Speaker Change #122: <unk> lottery strategy shows its strength, it's fair to say that over the last couple of years because of the inverted yield curve. We did have some opportunity cost by having the strategy, but I think we're very much seeing that.

Unknown Executive: But I think we're very much seeing that as yield curves start to normalize, that we still have lots of opportunity for client fund interest growth. I would just add to that that the portfolio is continued to grow. It's going 3 to 4% again next year, maybe not as much as it has in the past couple of years, because wages have moderated a little bit, pays for control of moderated a little bit. But we're still seeing; we're still seeing good growth. In that area, so we still have lots of opportunity. And the most important thing here, the most important comment I can make on this whole fund strategy is that we base all of these commitments, or all of these expectations, on the current yield curve.

Don Edward McGuire: But I think we're very much seeing that as yield curves start to normalize, we still have lots of opportunity for client fund interest growth. Yeah, I would just add to that that the portfolio is continuing to grow. It's growing three to 4% again next year, maybe not as much as it has in the past couple of years because wages have moderated a little bit, and pay per control has moderated a little bit.

Speaker Change #112: Field curves start to normalize it we still have lots of opportunity for for client funds interest growth.

Speaker Change #112: I would just add to that that.

Speaker Change #126: The portfolio is continuing to grow it's growing 3% to 4% again next year, maybe not as much as it has in the past couple of years, because wages have moderated a little bit pays per control have moderated a little bit, but we're still seeing we're still seeing good growth.

Don Edward McGuire: But we're still seeing good growth in that area. So we still have lots of opportunity. And the most important thing here, the most important comment I can make on this whole fund strategy is that we base all of these, all of these commitments, and all of these expectations on the current yield curve. We're not trying to outguess the market.

Speaker Change #110: In that area. So we still have lots of opportunity and the most important thing here. The most important comment I can make on this whole.

Speaker Change #110: Fund strategy is that we base all of these.

Speaker Change #110: All of these commit.

Speaker Change #110: Commitments are all of these expectations on the current yield curve, we're not trying to I guess the market. We're looking with the market in general has to say and we're using those yield curves to put together our forecast and our guidance on an.

Unknown Executive: We're not trying to outguess the market; we're looking at what the market in general has to say, and we're using those yield curves to put together our forecasts and our guidance on the interest rates.

Don Edward McGuire: We're looking at what the market in general has to say, and we're using those yield curves to put together our forecast and our guidance for the uninterested. Okay, that helps a lot.

Speaker Change #110: On interest rates.

Unknown Executive: Okay, that helped a lot.

Speaker Change #128: Okay. That's helpful. Thank you so much.

Unknown Executive: Thank you so much. Thank you.

Caroline Noelle Latta: Thank you so much. Thank you. Our next question comes from Ashish Sabadra with RBC Capital Markets. Your line is: Hi, this is David Page on First.

Ashish Sabadra: Thank you. Our next question comes from Ashish <unk> with RBC capital markets. Your line is open.

Unknown Executive: Our next question comes from a She's Sabaja with RBC Capital Markets. Your line is open. Hi, this is David Page on first. She thinks we're taking our question. I just wanted to circle back to the workforce optimization charge that we had in the quarter: 42 million. Should we expect further work or optimization in 2025? And if yes, how much of that there was the benefit to the EPS guidance for 25 as well. David, as Maria has shared earlier, I mean, we're always looking to make sure that we've got the workforce at the size it needs to be and in the places it needs to be.

Speaker Change #110: Yes.

Speaker Change #110: Hi, This is David page on for Ashish, Thanks for taking our question.

Ashish Sabadra: I just wanted to circle back to the workforce optimization charge that we had in the quarter, $42 million. Should we expect further? Yes, how much of that?

David Mark Togut: I just wanted to circle back to the workforce optimization.

Speaker Change #113: Charge that we had in the quarter of $42 million should we expect further workforce optimization in 2025.

Speaker Change #113: And if yes, how much of that or what's the benefit to.

Speaker Change #135: The EPS guidance for 'twenty five as well.

Don Edward McGuire: David, as Maria shared earlier, we're always looking to make sure that we've got the workforce at the size it needs to be and in the places it needs to be. So we made those difficult decisions that we had to make on behalf of some of those employees. But we always look at this.

Speaker Change #113: David.

David: Earlier, I mean, we're always looking to make sure that we've got the workforce at the size that needs to be and into places that needs to be.

Unknown Executive: So we made those difficult decisions that we had to make on behalf of some of those employees, but we always look at this. And if you look at ADP over the years, we've always done what needs to be done to go forward. So I would just leave it at that and say that we're very happy with the guidance we put out here and the margin guidance as well. So we will make sure that we do what we need to do to execute, and we'll see what the future brings.

Speaker Change #141: So we made those difficult decisions that we had to make on behalf of some of those employees, but we always look at this and if you look at ADP over the years, we've always done what needs to be done to go forward. So I would just leave it at that and say that we're very happy with.

Don Edward McGuire: And if you look at ADP over the years, we've always done what needs to be done to go forward. So I would just leave it at that and say that we're very happy with the guidance we put out here and the margin guidance as well. So we will make sure that we do what we need to do to execute. And we'll see what the future brings.

Speaker Change #124: The guidance, we put out here in the <unk>.

Speaker Change #124: Margin guidance as well so we will make sure that we do what we need to do to execute and we will see what we will see what the future brings but as we sit here today, we've done what we need to do and we're looking forward to the future.

Unknown Executive: But as we sit here today, we've done what we need to do, and we're looking forward to the future.

Kartik Mehta: But as we sit here today, we've done what we need to do, and we're looking forward to the future. Thank you. Our next question comes from Kartik Mehta with North Coast Research. Your line is open.

Unknown Executive: Great, thank you. Thank you.

Speaker Change #125: Great. Thank you.

Speaker Change #131: Thank you. Our next question comes from Kartik Mehta with Northcoast Research. Your line is open.

Unknown Executive: Our next question comes from Kartik Mehta with North Coast Research. Your line is open. Good morning. I know you've talked about the strength and bookings quite a bit, and I'm just trying to surprise is maybe asking to buy less modules they have in the past. Any kind of change or hasn't been pretty much status quo and really no change from a demand for a sales cycle standpoint. It's a great question. I think we talked about it a bit in last quarter and perhaps throughout the year, which is that we're really out of new normal as it relates to the overall sales cycle.

Maria Black: Yeah, good morning. I know you've talked about strength and bookings quite a bit. And I'm just wondering, from an enterprise sales standpoint, if there's been any change, as in, is the sales cycle lengthening at all? Are enterprises maybe asking to buy fewer modules they haven't had? Any kind of change? Or has it been pretty much the status quo, and really no change from a demand or a sales cycle standpoint? Fair enough. It's a great question.

Kartik Mehta: Yes, good morning.

Kartik Mehta: You've talked about the strength in bookings quite a bit and I'm just wondering from an enterprise sales team.

Kartik Mehta: If theres been any change.

Speaker Change #136: Is the sales cycle lengthening at all our enterprises, maybe asking to buy less modules. They have in the past any kind of change or has it been pretty much status quo and.

Speaker Change #129: Really no change from a demand or a sales cycle standpoint.

Maria Black: I think we talked about it a bit last quarter and perhaps throughout the year, which is that we're really at a new normal as it relates to the overall sales cycles. It's reminiscent of what it used to look like pre-pandemic, but arguably, there are more decision makers involved. The process has elongated a bit from where it was during the height of the pandemic, but the deals are moving through the motions. I would say that they're moving through the motions pretty normally, but certainly it's not as fast as it was at one point in time, but we're not seeing fewer modules.

Speaker Change #133: Fair. It's a great question I think we talked about it a bit last quarter and perhaps throughout the year, which is that we're really at a new normal as it relates to the overall sales cycles, it's reminiscent of what it used to look like pre pandemic, but arguably they are more decision makers involved are the process has elongated a bit from where it was during the <unk>.

Kartik Mehta: It's reminiscent of what it used to look like pre-pandemic, but arguably there are more decision makers involved. The process has elongated a bit from where it was during the height of the pandemic, but the deals are moving through the motions. I would say that they're moving through the motions pretty typically, but certainly, you know, it's not as fast as it was at one point in time. But we're not seeing less modules. We are seeing a big conversation around global, a big conversation around global system or record things of that nature, which again is where this next gen HCM that's squarely into a into that demand.

Speaker Change #129: The the pandemic, but the deals are moving through the motions I would say that they're moving through the motions pretty typically.

Kartik Mehta: Certainly it's.

Kartik Mehta: It's not as fast as it was at one point in time, but we're not seeing less modules.

Maria Black: We are seeing a big conversation around global, a big conversation around the global system of record, things of that nature, which again is where this next-gen HCM fits squarely into a.., into that demand. So the conversations have shifted a bit, but that's not necessarily new news, Kartik.

Kartik Mehta: We are seeing a big conversation around a global conversation around a global system of Rockford things of that nature, which again is where this next gen HCM fits squarely into our.

Kartik Mehta: Into that demand so the conversation has shifted a bit but that's that's not necessarily new news kartik, it's really what we've seen over the last couple of years.

Unknown Executive: So the conversations shifted a bit, but that's not necessarily new news, Kartik. It's really what we've seen over the last couple of years as a byproduct of how clients in that enterprise global space operate. So certainly, that's how we're leading with that; that's to offer kind of across the enterprise and international space. But from that, a deal cycle standpoint, it's pretty similar to what we've seen throughout this year, which is more decision makers involved and prudency as it relates to the decisions that are being made, but not necessarily less modules or anything of that nature.

Maria Black: It's really what we've seen over the last couple years, as a byproduct of how clients in that enterprise global space operate. So certainly, that's how we're leading with that best offer kind of across the enterprise and international space. But from that ideal cycle standpoint, it's pretty similar to what we've seen throughout this year, which is more decision makers involved and prudence as it relates to the decisions that are being made, but not necessarily fewer modules or anything of that nature.

Kartik Mehta: By product of how clients and not enterprise global space operate so certainly that's how we're leading with that best offer kind of across the enterprise and international space, but.

Speaker Change #139: From a deal cycle standpoint, it's pretty similar to what we've seen throughout this year, which is more decision makers involved and prudency as it relates to the the decisions that are being made but not necessarily less modules or anything of that nature.

Unknown Executive: And then just on the small business side, I mean, you know, as you look at the health of the small business, anything that is changing or anything that would give you concern. Just the, you know, as people get worried about the economy or change in behavior. Yeah, great question. So we monitor so many of these things, right? So I spoke to one of them earlier, which is the pace of new business formation that tends to be a bit bellwether. Again, it's still elevated from norms, but it is down year on year. We are also monitoring our own out of business.

Maria Black: And then just on the small business side, I mean, you know, as you look at the health of small businesses, anything that is changing, or anything that would give you concern, just the, you know, as people get worried about the economy, or, Unknown Speaker, Unknown Speaker, Yeah, great question. So we monitor so many of these things, right? So I spoke to one of them earlier, which is the pace of new business formation. That tends to be a bit of a bellwether. Again, it's still elevated from norms, but it is down year on year.

Kartik Mehta: And then just on the small business side.

Speaker Change #137: As you look at the health of the small business anything that is changing or anything.

Speaker Change #134: Would give you concern.

Speaker Change #132: Just the.

Speaker Change #132: People get worried about the economy or change in behavior.

Speaker Change #138: Yeah, Great question. So we monitor so many of these things right. So I spoke to one of them earlier, which is the the pace of new business formation that tends to be a bellwether again, it's still elevated from norms, but it is down year on year. We are also monitoring our own out of business. We're looking at our clients that call.

Maria Black: We are also monitoring our own out of business; we're looking at clients that call it suspend payroll and how many are sitting in that type of capacity. These are all things and metrics that we've monitored for years to ensure that we're kind of seeing, you know, what is happening in real time, if you will. What I would say are the little pockets, very similar to the new business formation of kind of watch items that we have our eye on. None of it, at this juncture, gives us great pause; quite the opposite.

Unknown Executive: We're looking at clients that call it the spun payroll and how many are sitting in that type of capacity. These are all things and metrics that we've monitored for years to ensure that we're kind of seeing, you know, what is happening real time, if you will. What I would say is the little pockets very similar to the new business formation of kind of watch items that we have our eye on. None of it at this juncture gives us great pause; quite the opposite. But at the same time, we're monitoring these things to make sure that we don't get surprised as it relates to the shift.

Speaker Change #132: At suspend payroll and how many are sitting in that type of capacity. These are all things and metrics that we've monitored for years.

Speaker Change #132: To ensure that we're kind of seeing what.

Speaker Change #132: What is happening real time, if you will but I would say is a little pockets very similar to the new business formation of kind of watch items that we have our eye on none of it at this juncture. It gives us great pause quite the opposite but at the same time.

Maria Black: But at the same time, we're monitoring these things to make sure that we don't get surprised as it relates to the shift should there be one, but there hasn't been one yet. Perfect. Thank you so much. I really appreciate it. Thank you. There are no further questions. I'd like to turn the call back over to Maria Black for any closing remarks.

Speaker Change #132: We're monitoring these things to make sure that we don't get surprised as it relates to the other shift should there should there be one but there hasn't been one yet.

Unknown Executive: Should there, should there be one that there hasn't been one yet? Perfect. Thank you so much. I really appreciate it. Thank you.

Speaker Change #132: Perfect. Thank you so much I really appreciate it.

Speaker Change #132: Thank you there are no further questions I'd like to turn the call back over to Maria Black for any closing remarks.

Unknown Executive: There are no further questions.

Maria Black: I'd like to turn the call back over to Maria Black for the closing remarks. Great. Thank you. So I will end where I started, which is I'd like to take this opportunity to thank our 64,000 associates. All of the results that Dom and I have the pleasure of getting on this call to represent. They are a byproduct of 64,000 associates that are all incredibly committed to having the best-in-class technology, the best service, and the biggest, broadest global scale. And everything we do, whether it's from product innovation to our contracting process, to our sellers, to our service associates, it really takes the entire company being aligned on what I would suggest is a commitment to client and client centricity.

Maria Black: So I will end where I started, which is I'd like to take this opportunity to thank our 64,000 associates. All of the results that Don and I have the pleasure of getting on this call to represent are a byproduct of 64,000 associates that are all incredibly committed to having the best in class technology, the best service, and the biggest, broadest global scale. And everything we do, whether it's from product innovation, to our contracting process, to our sellers, to our service associates, it really takes the entire company being aligned on what I would suggest is a commitment to client and client centricity.

Maria Black: Great. Thank you. So I will end, where I started which is I'd like to take this opportunity to thank our 64000 associates all of the results that Don and I have the pleasure of getting on this call represent they are a byproduct of 64000 associates that are all incredibly committed to having the best in class technology.

Kartik Mehta: Best service and the biggest broadest global scale and everything we do whether it's from product innovation to our contracting process to our sellers to our service associates. It really takes the entire company being aligned on what I would suggest is our commitment to client and client centricity.

Maria Black: In that spirit, I'd also like just to take a minute to thank our 1.1 million clients. I will tell you, as we celebrated the 75th anniversary of ADP, it was quite a remarkable moment to think about all the clients that we've impacted over 75 years and have had the honor of contributing to their journeys of success and navigation. So I definitely want to take a minute to honor all of our clients. And then, last but not least, all of you who dialed in today. I appreciate you joining us.

Maria Black: In that spirit, I'd also like just to take a minute to thank our 1.1 million clients. I will tell you, as we celebrated the 75th anniversary of ADP, it was quite a remarkable moment to think about all the clients that we've impacted over 75 years and had the honor of contributing to their journeys of success and navigation. So definitely want to take a minute to honor all of our clients. And then, last but not least, all of you who dialed in today, I appreciate you joining us. I appreciate your interest and your investment in ADP.

Kartik Mehta: And in that Spirit I'd also like just to take a minute to thank our $1 1 million clients I would tell you as we celebrated the 70 <unk> anniversary of ADP.

Kartik Mehta: It was quite a remarkable moment to think about all the clients that we've impacted over 75 years and had the honor of contributing to their journeys.

Maria Black: I appreciate your interest and your investment in ADP. And I look forward to speaking with you soon. Thank you for your participation. You may now disconnect. Everyone, have a great day. Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music, ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music

Kartik Mehta: Success in navigation, so definitely want to take a minute to out to honor all of our clients and then last but not least all of you who dialed in today I. Appreciate you joining us I appreciate your interest and your investment in ADP and I look forward to speaking with you soon.

Maria Black: And I look forward to speaking with you soon. Thank you for your participation.

Speaker Change #140: Thank you for your participation you may now disconnect everyone have a great day.

Unknown Executive: You may now disconnect everyone. Have a great day. Thank you very much.

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Unknown Executive: Thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us Thank you very much joining us today, thank you Thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us Thank you very much joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us today, thank you very much for joining us Thank you very much for joining us today, thank you very much for joining us today Thank you very much for joining us today.

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Unknown Executive: Thank you very much.

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