Paychex (PAYX) FY2023 results: revenue $5.0 billion, up 8.6% on the year

Paychex Inc. (PAYX) reported revenue of $5.0 billion for fiscal 2023, the year ended 31 May 2023, up 8.6% on the year before. Net income was $1.6 billion, up 11.8%, and diluted earnings per share $4.30. The figures are the company's own, from the 10-K it filed with the SEC on 14 July 2023.

Revenue

$5.0 billion

+8.6% on the year

FY2016FY2023

Operating margin

40.6%

39.9% a year earlier

FY2016FY2023

Net income

$1.6 billion

+11.8% on the year

FY2016FY2023

Diluted EPS

$4.30

+12.0% on the year

FY2016FY2023

this yearthe year beforeHover a bar for its figure.

The year in brief

The four quarters: Q1 FY2023 · Q2 FY2023 · Q3 FY2023 · Q4 FY2023

Income statement (profit and loss)

$ million	FY2023	FY2022	FY2021	On the year
Revenue	5,007	4,612	4,057	+8.6%
Cost of revenue	1,453	1,356	1,271	+7.1%
Gross profit	3,554	3,255	2,786	+9.2%
Gross margin	71.0%	70.6%	68.7%
Selling, general and administrative	1,521	1,415	1,325	+7.5%
Operating income	2,033	1,840	1,461	+10.5%
Operating margin	40.6%	39.9%	36.0%
Interest expense	36.7	36.6	35.8	+0.3%
Pre-tax income	2,048	1,825	1,434	+12.3%
Income tax	491	432	337	+13.7%
Effective tax rate	24.0%	23.7%	23.5%
Net income	1,557	1,393	1,098	+11.8%
Net margin	31.1%	30.2%	27.1%
Diluted EPS	$4.30	$3.84	$3.03	+12.0%

$ million except per share.

Free cash flow is operating cash flow less capital expenditure; the effective tax rate is income tax over pre-tax income; margins are the line over revenue. Gross profit is revenue less cost of revenue, and operating income is revenue less the company's own total costs, where the statement does not print those lines. Those four are arithmetic on the filed numbers; everything else is as filed. Money is in $ million as the company files it, or in $ billion by the switch above the tables; per share figures and share counts are as they are.

Cash flow

$ million	FY2023	FY2022	FY2021	On the year
Operating cash flow	1,706	1,590	1,260	+7.3%
Capital expenditure	143	134	118	+6.9%
Free cash flow	1,563	1,456	1,142	+7.4%
Free cash flow margin	31.2%	31.6%	28.1%
Cash from investing	212	-1,505	-461
Cash from financing	-711	-979	-636
Depreciation and amortisation	177	192	192	-7.9%
Share-based compensation	62.6	52.8	52.5	+18.6%
Buybacks	0.0	145	156
Dividends paid	1,175	1,000	909	+17.5%
Dividend per share	$3.26	$2.77	$2.52	+17.7%
Diluted shares, weighted	362m	363m	362m	-0.2%
Shares outstanding at period end	360m	360m	360m	+0.2%

Balance sheet

$ million	FY2023	FY2022	FY2021	On the year
Shareholders' equity	3,493	3,085	2,948	+13.2%
Debt	808	806	805	+0.2%
Operating lease liabilities	57.3	74.8	92.4	-23.4%
Other liabilities	6,188	5,669	5,382	+9.2%
Total liabilities and equity	10,546	9,635	9,227	+9.5%
Fixed assets	396	401	396	-1.2%
Goodwill	1,834	1,832	1,821	+0.1%
Intangible assets	187	225	276	-16.6%
Investments	377	859	43.8	-56.1%
Cash and equivalents	1,222	370	995	+230.3%
Other assets	6,530	5,949	5,696	+9.8%
Total assets	10,546	9,635	9,227	+9.5%

10-K for the year ended 31 May 2023, filed 14 July 2023: the filing.