Dayforce Raises Annual Revenue Forecast Due to Strong Payroll Demand; Shares Increase, Reports Reuters

Dayforce has raised its full-year revenue forecast, anticipating strong demand for its payroll and human capital management services. This positive outlook resulted in an 8% increase in its shares during premarket trading.

The company’s flagship Dayforce platform saw a significant boost in second-quarter recurring revenue, climbing 20% to $321.6 million, driven by robust client spending on its cloud-based human resource management, recruiting, and payroll processing services.

Extensive investments in artificial intelligence have enhanced Dayforce’s ability to compete with larger industry players. CFO Jeremy Johnson noted that the strong performance has led to improved cash flow, prompting the Board of Directors to approve a $500 million share repurchase program.

For fiscal year 2024, Dayforce anticipates revenue between $1.74 billion and $1.75 billion, an increase from its previous estimate of $1.73 billion to $1.74 billion. However, the company’s forecast for third-quarter revenue ranges from $425 million to $430 million, which falls short of analysts’ average expectation of $430.7 million.

In the second quarter, Dayforce’s revenue reached $423.3 million, marking a 15.7% increase from the previous year and surpassing expectations of $417.5 million. Nevertheless, the company reported a net loss of 1 cent per share, compared to a net income of 2 cents from the same quarter a year prior.