AUTOMATIC DATA PROCESSING INC

Automatic Data Processing, Inc. operates in the Human Capital Management industry, providing HR, payroll, talent, time, benefits, and outsourcing solutions. The company serves over 1.1 million clients and pays over 42 million workers in over 140 countries and territories. The industry is highly competitive, with competition based on product and service quality, reputation, ease of use and accessibility of technology, breadth of offerings, and price.

ADP is one of the largest providers of HCM solutions in the world. Primary competitors include other business outsourcing companies, companies providing ERP services, providers of cloud-based HCM solutions, and financial institutions. The PEO business competes with other PEOs. ADP's competitive advantages include its leading-edge technology, its industry's largest workforce dataset spanning over 1.1 million clients and 42 million workers, and its global scale. In the U.S., ADP pays one in six workers and moved $3.5 trillion in fiscal year 2026.

ADP generates revenue through a comprehensive range of technology-based HCM solutions and HRO solutions. The business is characterized by long-term client relationships that result in recurring revenue. Client retention is estimated at approximately 13 years in Employer Services and approximately 6 years in PEO. No single client or group of affiliated clients accounted for revenues in excess of 2% of annual consolidated revenues in fiscal 2026.

The Employer Services segment offers HCM solutions including Payroll Services, Benefits Administration, Talent Management, Workforce Management Solutions, Compliance Solutions, Human Resources Management, Retirement Services, and Insurance Services. Key platforms include RUN Powered by ADP serving over 980,000 small businesses, ADP Workforce Now used by over 90,000 mid-sized and large businesses in North America, and ADP Lyric HCM for large enterprises. ADP pays approximately 26 million workers in the United States. ADP Retirement Services helps over 210,000 employers. ADP's Insurance Services facilitates access to workers' compensation and group health insurance for over 280,000 small and mid-sized clients. ADP SmartCompliance processed and delivered more than 79 million employee year-end tax statements in fiscal 2026.

The Professional Employer Organization segment, ADP TotalSource, serves more than 19,000 clients and more than 770,000 worksite employees in all 50 U.S. states. ADP TotalSource is the largest PEO certified by the Internal Revenue Service as a Certified Professional Employer Organization. ADP's HRO solutions serve over three million client employees. Global Solutions serve over 70,000 clients, with ADP paying over 16 million workers outside the United States. ADP's Workforce Management offers solutions to over 160,000 employers. ADP acquired Pequity in 2025 to support compensation planning needs.

During fiscal 2026, ADP invested approximately $1.405 billion in research and development. The company acquired Pequity in 2025. ADP's common stock is listed on the NASDAQ Global Select Market under the symbol ADP. As of July 31, 2026, there were 397,262,737 shares of Common Stock outstanding.

Total revenues for fiscal 2026 were $19.594 billion, compared to $18.006 billion in fiscal 2025 and $16.621 billion in fiscal 2024. Net income was $4.066 billion in fiscal 2026, compared to $3.722 billion in fiscal 2025 and $3.659 billion in fiscal 2024. Diluted EPS was $9.87 in fiscal 2026, compared to $8.96 in fiscal 2025 and $8.78 in fiscal 2024.

ADP is focused on leading with best-in-class HCM technology, including AI built into the core of its platforms. The company's global data platform was named 2026 Data Solution of the Year for HR in the Data Breakthrough Awards. ADP's approach to AI agents earned recognition as one of Fast Company's 2026 Most Innovative Companies, earning the number one spot among HR companies. ADP continues to invest in its sales organization and best-in-class sales technology.

ADP is expanding its global footprint, serving clients in over 140 countries and territories with 67,000 associates. The company is focused on delivering a single, unified, consistent experience for global and multinational clients, leaning into its strength in global payroll and expanding HR and workforce management solutions. ADP continues to build relationships with best-in-class providers for seamless integrations through embedded payroll offerings and the ADP Marketplace.

The filing does not discuss specific margin trajectory, cost structure evolution, or efficiency targets in a forward-looking context.

ADP invested approximately $1.405 billion in research and development in fiscal 2026.The filing does not explicitly flag structural headwinds or execution risks to the growth plan in a forward-looking context.

The filing does not explicitly identify geographic, regulatory, or macro factors as constraints in a forward-looking context.

The industries in which ADP operates are highly competitive, and the company faces competition from other business outsourcing companies, ERP service providers, cloud-based HCM providers, financial institutions, and companies' in-house functions. ADP's business is subject to a wide range of complex U.S. and foreign laws and regulations, including privacy, data protection, AI, and cybersecurity laws such as the GDPR, CPRA, and the DOJ's Data Security Program. The ADP Trust Bank is subject to comprehensive ongoing oversight and regulation by the OCC. ADP TotalSource is subject to various state licensing requirements and, as a co-employer, may be subject to certain obligations and liabilities under federal and state tax, insurance, and employment laws. Changes in laws or regulations affecting clients may also impact ADP's operations, products, and services.

Management emphasizes three strategic priorities: lead with best-in-class HCM technology, provide unmatched expertise and outsourcing solutions, and benefit clients with global scale. The filing highlights that ADP's AI is built into the core of how it orchestrates, governs, and executes HR and pay processes. Management states that ADP's global data platform, spanning over 1.1 million clients and 42 million workers, provides the industry's largest workforce dataset. The filing notes that in the U.S., ADP pays one in six workers and moved $3.5 trillion in fiscal year 2026. Management's tone is confident in ADP's competitive position, emphasizing its 77 years of workforce expertise, global scale, and commitment to responsible AI through an active AI & Data Ethics Council.