Paylocity Holding-Paylocity Q2 Earnings & Revenues Beat Estimates, Stock Gains

Core Insights - Paylocity Holding Corporation (PCTY) shares increased by 4.24% to $221.00 in after-hours trading following strong second-quarter fiscal 2025 results [1] Financial Performance - PCTY reported non-GAAP earnings of$ 1.52 per share, exceeding the Zacks Consensus Estimate by 9.35%, with a year-over-year increase of 2% driven by strong sales, efficient operations, and acquisitions [2] - Revenues rose 16% year over year to $377 million, surpassing the Zacks Consensus Estimate by 2.77%, with recurring and other revenues increasing by 16.5% to$ 347.7 million [3] - Adjusted gross profit was $278.2 million, up 17.3% year over year, with an adjusted gross margin of 73.8%, an increase of 110 basis points [4] Operational Metrics - Non-GAAP operating income increased by 9% year over year to$ 101.1 million, while the non-GAAP operating margin contracted by 160 basis points to 26.8% [4] - Adjusted EBITDA rose 12% from the previous year to $126.2 million, with an adjusted EBITDA margin of 33.5%, down 100 basis points [4] Balance Sheet & Cash Flow - As of December 31, 2024, cash and cash equivalents were$ 482.4 million, down from $778.5 million as of September 30, 2024, with long-term debt totaling$ 325 million due to borrowings for the acquisition of Airbase [5] - Cash flow from operations for the second quarter was $54.2 million, compared to$ 75.1 million in the prior year, with free cash flow at $41.9 million [6] Guidance - For Q3 fiscal 2025, PCTY expects total revenues between$ 439 million and $444 million, indicating a 10% growth year over year, with adjusted EBITDA projected at$ 171 million to $175 million [7] - For the full fiscal 2025, total revenues are projected between$ 1.558 billion and $1.568 billion, implying an 11% growth year over year, with adjusted EBITDA expected to be between$ 542 million and $555 million [8] Market Position - PCTY currently holds a Zacks Rank 2 (Buy), indicating positive market sentiment [9]