Paycom Raises 2025 Revenue and Profit Forecasts on AI-Driven Demand

Payroll software provider Paycom Software (PAYC.N) boosted its fiscal 2025 revenue and profit guidance on Wednesday, attributing the upward revision to increased demand driven by new AI capabilities in its platform. The company’s shares rose 7% in after-hours trading following the announcement.

Paycom now projects annual revenue between $2.05 billion and $2.06 billion, up from its previous forecast of $2.02 billion to $2.04 billion, surpassing the $2.03 billion consensus estimate. The company’s CEO, Chad Richison, highlighted the “smart AI” suite integrated into Paycom’s software, which automates workforce tasks such as drafting job descriptions and identifying employees at risk of leaving, helping employers streamline management processes.

Profit expectations for 2025 were also raised, with core profit forecasted between $872 million and $882 million, compared to prior guidance of $843 million to $858 million. In the second quarter ended June 30, Paycom reported revenue of $483.6 million and adjusted core profit of $198.3 million, both beating analyst estimates.

Despite these gains, the company’s optimism comes amid weakening U.S. labor market conditions, with July’s employment growth falling short of expectations and prior months’ payroll figures revised downward by 258,000 jobs.