Adjusted EPS of $1.14 beat the analyst consensus estimate of $1.12.

Selling, general and administartive expenses climbed 8% to $389.5 million.

Operating income for the quarter increased 8% to $536.3 million with an operating margin of 41.7%, a 60 basis point expansion.

The company held $1.7 billion in cash and equivalents as of August 31, 2023. Operating cash flow for the quarter totaled $655.8 million.

President and Chief Executive Officer, John Gibson commented, "Small and mid-sized businesses remain resilient in navigating the broader macro-economic environment, as our Small Business Employment Watch continues to report that small businesses are hiring workers at a moderate level and wage inflation continues to normalize along with overall inflation."

Outlook: Paychex revised its FY24 adjusted EPS growth outlook from 9%-10% to 9%-11%.

The company's forecast for total revenue to grow in the range of 6% to 7% remains unchanged.

Price Action: PAYX shares are trading lower by 0.34% at $112.34 on the last check Wednesday.