PYCR - Earnings call transcript Q2 2022

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to Paycor's Second Quarter Fiscal Year 2022 Earnings Call. [Operator Instructions]. Please note, this conference is being recorded. I would like to turn the call over to Rachel White, Vice President of Investor Relations.

Rachel White

to year call December XXXX, welcome quarter the XX. and fiscal of which afternoon, Paycor's for earnings second Good ended on

Paycor's On Raul Adam me with Paycor's Chief Jr., Ante, Officer. the and Executive Financial today Chief Officer; call Villar, are

demand, of found be be following Investor today, recorded, the include our press section and call. is available being operations, representing of date. statements website current should of our the a can the which results products, -- release today conclusion to risks, matters. on available to will uncertainties is these customer other on made impact financial our and be this on upon the future. statements as in forward-looking and Our call our assumptions Therefore, replay on as Relations may results, issued any Statements expectations and financial as not website. views Today's based of call updated management's on related business and in not statements our subject subsequent our These relied of are are our be COVID-XX on

business of We turn of provide is metrics call measures and investors. additional to I'll the press website. financial refer Definitions certain provided non-GAAP reconciliation over release metrics to key our and GAAP to that, key in information and a to also measures to our With will business non-GAAP non-GAAP measures Raul. on

Raul Villar

in these as capital us shifting market accelerate revenue guidance, revenue robust in early is management billion all The on once joining over a of growth you which and to Paycor's our quarter you, year $XX time. Thank detail. which to We more raising our stages thank profitability are Paycor exceeded increase we and Adam cloud, still guidance. and the will the positions to discuss quarter full both human for delivered again fiscal discuss Rachel, strong results, second profitability Based second results.

quarter. modern Paycor's through a a small to empowering strong the as we continue our medium demand on solutions businesses by We built and proposition SaaS years for demonstrated focus differentiate open, and this for developed leaders, HCM focused experience to Two unique growth has ago, solutions for extensible in and which tailoring value revenue industries. business Paycor strategy key a drives employee Paycor on market by leaders, results. engagement our platform, XX%

Our mundane on of the and highlight dynamics can the technology Great engagement, tasks seen market retention to acquisition goal-setting, so that labor frontline and coaching, drive performance. play leadership Resignation that talent offerings. development importance our and elements automates strategies, leaders reevaluation focus business The associate talent key through or demand we've

helping employees regulatory companies increasing onboard, in complexity. coach virtual environment software attract, Our a with and is engage

QX. Our internal exceeded in team is on the we expectations and strategy our outlined, laser-focused we've executing

designed leaders As an outcome in investment of technology industries, in our our continue for win rates product increase. to

We've growth bookings growth. and last we've our the differentiated consistent accelerated against our organization. X starting made continued proposition, against quarters over is the the initiatives deliver performance growth our of significant made across This of Our is value quarter. execution progress during each levers changes validation performance-driven our strategic solid to revenue

increased working. is our Tier First, X on focus markets

in in as X we largest markets, significantly XX the Tier bookings to continue which cities We increase define America.

internal exceeded have One are Tier seller levels. markets in been markets focused in of markets. in to drive on We productivity strategic teams this again targets additional sales our X biggest staffing high X coverage our coverage. Tier has our quarter areas these and greater expanding now all sales while aggressively focus adding coverage we maintaining Today,

decision-makers. enormous The Pac-XX classroom. of HR the software expansion in newly Conference, increasing their West awareness be for partnership commitment our out provider the Paycor and to supports in brand leaders X-year We the developing key by highlights and Tier among are also and which the official to business Pac-XX's the excited named X viewership

successfully partner continue we Second, with brokers. to

for coming our Brokers benefits approach to remains and through advisers results. business they prioritized solution businesses, our administration receiving New broker their implementation clients. channel them mid-market flexible choice to for deliver that valuable strong enables continues appreciate while a select trusted and are guided and their of outsized

We XX% today, a continue expansion the broker this channel. are about we working with referral community valuable see significant of and within opportunity to

is approach resonating. industry-specific our Third,

food our offerings manufacturing, key professional that By rates, in we TAM, quarter. for launched companies their represent challenges. solve most and professional including beverage, services, services needs care, win developed purpose-built human are Our higher X which verticals, capital of health driving last understanding of solutions help our and XX% that specific pressing the tailored

quarter, that introduced staffing this reporting new For nursing reporting we payroll-based solution for requirements general complex automates a facilities. instance,

we our our continue Lastly, suite expand HCM to increase adoption and of bundles.

total adding continues by functionality and portfolio, the platform team Our expand ATM to $XX. per-employee depth to available PEPM, or the product per-month, new our rate increasing and of our expanding breadth

seeing management attach Talent only recognize of existing all customers. are We mind rates bundle develop, functionality for not onboard tools business need recruit them. is to for result, as launched driving leaders considerable and the leaders in to which of top a XXXX, associates, engage adoption increase new it's talent a today, we and in and they and also but excellent with deep the provides includes

we the ecosystem, clients marketplace. build in the an time partners enables and reducing by flexibility their XXX best quadrupled integration XX%. do number our our self-serve to capabilities its partners a ahead provides to applications significant for it stay enables of dynamic clients. year, that integrations, platform of and advantage time-to-market In to And average unified launching takes select We that for nearly integrate our including of the partners in software evolving total have partners. providing customers a open, to to our our platform now aspect have and the differentiated new It of the bolster extensible interoperability, made rapidly to Another our investments last to additional needs industry. us is we add

also insights top the analytics we analysis employees within turnover leaders drivers employee our help resignation Paycor of labor provides predictive today's employee new on at-risk identify released with quarter, market. turnover. to to that functionality and prevent in provides potential It tool This challenging actual

nationwide leave ever better leaders understand work to Great what for it's that an employer than plan and or employees through why the do to prevent critical Resignation, continue more As can outcome. to

receiving efforts to our support to clients, including are We comprehensive analytics last like intelligent providing to through the both for committed would year, this been best-in-class over of marks. which providing also year-end, valuable insights. our these to implementation leaders I help their and commend team in customer-first and excellent uncover have

a last launched with a Over highly self-service quarters, customer and support we robust tool base. portal customer efficient few knowledge chat the a

improvement a for year enhancements, We're a to in business wait As row the best commitment help top workplaces. the the employees result on proven million based to that second brand organization surveying engagement drive advocate and seen quarter. and are performance. XX demonstrates XX-year by are benchmarks. in performance an clients history recognized drivers XX cultural that client with we've Results other extremely live these top XX% to practices times during Energage, our a second a proud an workplace to to It we also of our and cultural build against high than employee more industry as be of predict

HuDey Super to would like season Cincinnati Bengals our our call upcoming amazing appearance. the their and nation, turn Adam With and client, the Bowl results and that, over to on we guidance. congratulate to discuss Lastly, I'll financial

Adam Ante

our our with quarter for outlook Bengals. Thanks, quarter review results third and a close year. of Go, Raul. second with and fiscal I'll begin the

of number market comes have a on remained XX,XXX segment client largely As for $XXX was pre-COVID organic primarily our The revenue measures low a end, growth. increase returned revenues $XXX the and And our by basis. reminder, record the client and had of my comments time customer related million. was a are first base driven as a has increase non-GAAP under this to flat. single-digit This grown quarterly our XX% as well levels labor to to expansion million, continued as financial micro from quarter is employees PEPM new clients. XX employees per growth year-over-year, growth The exceeded mid-market at base. customer average Total

our extent margin, for gross XXX revenue to ambitious and acquisition implementation and to expense XX% with of quarter, XX% our expectations. now growth increased and our revenue investments. as $XX year-over-year. we've our costs. a and line cost from of termination clients. especially investments growing to coming ago excluding clients impacted for markets. employees, client out Net XX% sales invest combination segment as Tier across profit is last year-over-year was depreciation the to programs, sequential well from segment, expectations. line related ensure compared experience. largely in in software retention targets million in due marketing Adjusted strategy $XX XXX contract as levels. delivered continues our organization this of the capitalized X% our to also continued client And lesser gross X to of we experience quarters line we the plans, decrease employment made XX.X%, growth ago. due of with or or we of was Aligned down to margin X,XXX to We and to expand in represents favorably by service support. investments our of a with and initiatives have marketing over revenue customer is now go-to-market great the Our and year and and a in COVID-related basis This all was Business improvements amortization teams this scale of XX% with year trend believe XX% client is our historical drive amortization, XX.X% to with Adjusted and just our is a margin Margin change a levels of points was X This continue a recovering pre-COVID million

investing returns We great results we seeing flow continue our to attractive and aggressively intend and while annually. investments, on neutral targeting free cash are

early and our We quickly of huge share cloud, million, expectations. for million stages to XX% X% are in costs of line drive we or the $X.X period transitioning shareholders. to was meaningful of R&D expense the and $XX strongly of value and R&D was will market compared Including year and more with revenue of believe capitalized enable investments spend us XX% similar to or in revenue, a $X.X capture at year-ago a the million revenue development to ago. these

to PEPM R&D was attract, opportunity insights and revenue, drive our and expand We expense product with their to strategically better and quarter XXXX. G&A of million to $XX to engage or XX% for leaders will the second consistent associates. of portfolio in continue invest coach

XX.X% to of aim million The previously percentage compared as sequentially. highlighted. or in and continue profitability have to X I was However, the XX% change ago. income the opportunity a revenue done year $XX we reflects drivers to in G&A so profit to invest a down drive Operating margin growth

quarter our steadily sheet, have We been levels of regard approximately In the Interest model, and we with We income an balance confident no profitable strong the to fund million. average $XXX top closed basis time. to ended are expand consistently attractive funds line million business was daily XX over of we we and the generated highly $XXX scalable with can quarter and $XXX,XXX growth profitability cash or balance expect points. With debt. deliver of client these on margins.

for the guidance third the to moving quarter. So

$XX to $XXX to and million. $XXX adjusted XX% midpoint at range, expect of operating growth or revenue the total million the income $XX of of We million million

our at $XX For the in $XX the year-over-year keep income the regarding million to we to to revenue million. expect And are things range. few $XXX mind raising to we of of million about guidance operating full our midpoint growth XX% A or outlook. year, million adjusted $XXX

will such to We in Our comps with generation. trends business. our lower the associated underlying easier form prior optimistic on year depressed about and strongest year-end the third our form with growth benefit is year-end quarter in production opportunities historically production QX employment to We in anticipate as historically revenue COVID. due W-X our due from seasonality associated remain

months XX-plus As expect during a take revenue. 'XX bookings we into growth in fully fiscal ramp to reminder, the will

in in digits, single remain driven low benefit minimal While improved continued from related we've in cautious part tailwind COVID. experienced including employment modest is the uncertainty trends by market a labor from growth. our to we guidance, This

marginal to begin little anticipate is to we 'XX our most the begin we rates to interest we seem rising some March. interest rise, lift will FY of expect our income, overnight driver in The critical impact that While rate as and anticipate guidance. rates likely

HCM posted income However, a the driven in $X.X generate and a In in we rate point good XX all feel another interest in client overnight our we growth in basis the elements quarter by estimated focused on to execution believe summary, quarter. increase business strong funds win in the have place less plan. momentum of We of the about our million market. than would

focus Our industries modern, resonating extensible in platform with with on a clients. unique is leaders

market remaining believe target our the in revenue on that, call we term. deliver we profitability percent With runway are the sustainable to for alone, growth and the improved SMB of positioned well Operator? open longer we'll questions. XX-plus With

Operator

Instructions]. [Operator

is Our with Mark JPMorgan. from Murphy first question

Mark Murphy

on congrats season. football And great Yes. a a great quarter,

way is So Raul, you, out? able kind X and Tier cities in I -- rate that growth the XX% it I much X flesh a versus wanted to are Or to bookings of to approximate if how that is X? Tier XX%? compare is ask you mean, to Tier seeing you roughly there there that of you're is faster

Raul Villar

Yes.

way is the overall it's above our bookings in And over of growth So XX% we're it it. to the think Tier X now is at average. is rate the Mark, about looking our way

previously to in having a continuing markets. the talked targets we our of We're growth those heads XX% we're are headcount press seeing about X Tier to had XX% of going that lot majority in, those on market. success. and year-over-year, headcount. continuing add So to into We're We're of

Mark Murphy

Okay. wage to may of follow-up, a your any about perspective, increase passing you inflation thinking labor that all, enters of the as if some thinking own that including topic are on input offset seeing perhaps -- the maybe -- margin light could living you about cost how And shed on you're able From of a structure? right, a through inflation, be cost to help in PEPM, your it are quick in at you higher you or costs?

Adam Ante

but the Yes. across higher price but Mark, see aggressive in and Nothing able some to costs, talked as us the shared. marginally Adam. to continue I transition think board, overly that of subscription haven't not folks of is customers, for allow to with. we to something that But in it we've to where And the some areas. pressure I increases do price it sense. labor we continuing bundles the into annually. of the internal could this guidance pricing factor some our to we've through. been Yes. And we're it's We're regular not course, see course, relates makes we'll that models evaluate terms that increases, of also opportunities we pressure mean newer

And -- for so to that opportunity customers allows at the in increases our wrap for enable and same the more and time. the products

Operator

with next Our Gabriela is question from Borges Goldman Sachs.

Gabriela Borges

Raul I'd their cross-sell to in to any versus it what X as differences noticing to customers as and pertains pertains to Adam, on it ask whether more rest the Tier love they're product, you're you to employee ground. propensity and growth, their buy seeing your the

X. for Just curious those and versus us you and X X of contrast the Tier in compare metrics could if health

Adam Ante

think it's don't getting Nothing a that overly more as last tiers over be different. well probably we've material. into to think that would XX bit we're And I as seeing Yes, no, early Gabriela. I those that the XX been necessarily little months. Hey, anything aggressively

of a say So to going think I the that the would going markets be a They there's point of any to sell so want sale. newer of That's little more bit be those tend bundle in also clients buy I call we're it's do strategy adopting a be point of we to sellers -- in that the sale. higher I think little differences bit those a sellers or -- time larger, can little at bit going little might material before larger function out. we little our markets to to a -- see bit a at clients there. bit

longer propensity higher that I to So too the that's those right unit upfront, maybe think buy term. you and But of little now. see strategy early see really economics our to a some bit

Gabriela Borges

That's as just consistently, get June? that we being growth XX% How on of you hotter deliver path Okay. the comparisons question put is particularly year-over-year should up. think Follow-up little the bit to more able a XX% into about sustainability the helpful. to

Adam Ante

thing Yes, the what business. about been new mean, is saying I on us beginning the consistency the for and really we've in the thanks. the bookings since

over Tier continue and to expansion in with revenue model deliver course, so where back see broker the We growth about get I to the we we And accelerate. our our into continue the as our there. we're on on to feel XX-plus to, as to continue I side to the we've strategies execute think other to and of improve then, X you're cross-sell way just and that bookings going the that's path the And base. that's retention the strategy time, pricing percent. the good committed think But internally,

Operator

with Our is Truist next from question Securities. Terry Tillman

Terrell Tillman

this the Yes. questions, scripted to guess but well. the X Congrats me And for it. as best who at Rachel, who's -- I from have curious I'm my can Adam had as I'm I Shuffle? Ickey and go Raul, follow-ups. I didn't going part then of

Raul Villar

the Shuffle. definitely in the is Ickey leader Adam

Terrell Tillman

All Got out of right. the that Okay. way.

you idea all you thought this going and, of call, to big And having sales that XX% on to? on a Raul, I if sales Adam. said coverage when a are had that's you're even coverage you was, a maybe hiring, for follow-up perspective, So the But you low is threshold? about success and I XX% have kind hiring. expanded you then And know ratio that where the if it's but give through went opportunity. from public, I Tier ratio us a now can X forgot hence, the sense on pretty where

Raul Villar

lots hiring there. hiring there. our in of the have I runway significantly there of We coverage X, Tier we've mean increased the Yes. again, from majority still perspective, a

the into target the we're with additional staying and feel onboarding think year of hiring rate that's leader, for can because system just right you from to like right an number XX% I for XX% people the perspective, how -- the it's quality. the headcount add we them, the

ultimately manage mean there. could we're that so a but be we And to it staying little higher, I day day.

our going think long good go We're Obviously, We're have I overall perspective. on our to totals. ahead coverage continue quarter-over-quarter. target. So based something Tier on to about that in that's of we we're seeing a from a just we guidance way X. But to feel good the headcount sales headcount build

Terrell Tillman

guess, of on question Okay. bookings. And Adam, the I conversion a

a point to us upside be the XX reason talked integration could Could bring of because in of and about work a to made implement. by there that remind remarks, technology revenue. there some the it's level conversion faster? be why the to all you prepared bit consistently reducing that's time to bookings question though, just some I I all's improvements of You've upwards XX%. up, if little The in this from is you some that. of conservatism strong months curious, I'm part know

curious, potential behalf of adept getting stuff bit So just kind there out conservatism I'm powder more just kind all this of a customers? rolling you on or of is any dry at little

Adam Ante

is support peak job some great help into us a Thanks, see in Yes. in I the and energy more mean, we a busiest the done Terry. year-end, I our I has more January. lot mean, time. And of we're clearly that the of I parties also efficient here to that think team. definitely team put The getting definitely third -- using through time space. we're which

just I out And XX% -- performance is the point Again, It in the accelerate FY that really there continues bookings I up December. the continued cautioned improvements. think coming 'XX about seeing of through we're and be is show bookings thing some faster. that growth could do So the to doesn't opportunities.

a revenue. focus part the It all to all before improvements that the But and of just sort continue to of our of big And us. last come years. to quarter couple the revenue a bookings big see frame, over is that it's really continue in. gets so into internally, we of in or time been April ramp January going it's will layered for yes, and of

Operator

Bergin Cowen Bryan Our Company. with is next and from question

Jared Levine

Jared This is Bryan. Levine actually on for

revenue did net where did retention, stand to the normalized level the retention in And for return In then, gross that terms of mid-XXs? revenue XQ?

Adam Ante

Jared. consistent. been Yes, Gross retention fairly has

don't improvements. given but sure, retention, haven't on the quarters show yes, for to think, consistent. the number I We net And continues explicitly, fairly

And that range we mid-XX% so see that in a right bit return little quarter-over-quarter. better

positive momentum see in to and there gross retention. continue net we both retention So

Jared Levine

it you the pretty related in skewed it Great. And Okay. certain would a Omicron? impact size? then terms to any And then broad-based? it environment, in of describe was was demand of -- terms how employer towards Or

Raul Villar

all it impact more I and we broad-based. haven't an been all sizes. seen than strong for of would we it's It's for execution had say much us. clients markets And of in our an Omicron, Yes, impact. too is

keeping any been impact them, COVID, But people So we're for quarter people like first in we have staff. on businesses that, seeing some overall impact the didn't hiring obviously, other closed, since and see of environment. than demand the

Operator

question next from Samana with is Jefferies. Our Samad

Samad Samana

the you Good dig compare last I ramped fully the year? versus a guys quotas, that about kind ramped and coverage know side to reps So how want healthy think headcount more. not reps should but growth. about to to this of maybe just the how of kind goals. mix the of we just But I does maybe talked little it in time and bit see right coverage for productivity maybe are now? on sales the productive percentage

Adam Ante

Yes. Hey, Samad.

are be they into course, their -- newer as higher with folks who in still their hiring those with of as to total capacity we're full did tenure than So ramping year a excuse me, really hiring this still that we're going percentage the we and quota-carrying of than are quota, us. we they're sellers number course, more our of ones as are the last of see lower year,

year. going a different than seen little what So last would have bit it to be is we

year, course, by our about only we headcount X%. last Of grew

and that of growth lot now a through XX% on target QX for to So QX, said, like QX, on earlier into XX%. Raul

would ramped our of we and expected is productive as as fully or But we total folks clearly fully that see, hire do have we as of designed a sellers. we less sellers, these in. sort as So percentage

Samad Samana

kind bodes Great. That those of growth right, reps as certainly sustaining, for well come online.

another to just good there's know maybe hear. "build partner" And I buy a philosophy. the for the Raul, product company that's of, I that of -- you we've that. opportunistic some you product of about think Anything maybe seen. you're the turmoil buy about maybe and So how in question some that versus versus about perspective the with think of think curious from being on accelerating just side, terms I'm rollouts how then thinking a or

Raul Villar

Yes.

I space. to in be think continue we opportunistic the

We But can are to of believe us, evaluating we a the significant in number for has the be right us opportunity type it of opportunities. that future. help

And and against to to portfolio PEPM execute we've our tuck-in-type overall our I objectives. historically, we'll that. help expand X continue or And X to product so think acquisitions add added

yes, so It's just And trying market. ones lot the of the a right there's to in find opportunities for Paycor.

Samad Samana

just I'll it a one. And short I'll squeeze make and Great. one in, more

their retention the the funnel, I that Are other heard Paycor. maybe some be which as SMBs seeing we in the maybe are to top talk from leads own interest maybe the of about top activity how the companies prior of for good would coming we've just normalizing, conversion? of in think think the space about any even funnel or you about Just think into the I changes

Raul Villar

both our in significant seen leads the We've increase we visitors what and into system. would high-quality site consider Yes.

primarily both the which complexity, tend the now retaining, of issues, for, looking in right So the of to we top-of-the-funnel are for has are generation, companies attracting and that, drivers talent be There's strong category. a to lot lot think things really regulatory a that demand opportunities created all us. fundamentals

Operator

with Brian Our James. next question from is Raymond Peterson

Brian Peterson

strong the on Congrats guys. quarter,

services. mentioned big how your that be verticals? the have the of that just do in some others remind pro on other to how is us that curious versus you look to early verticals, of And about some think you ramp opportunity relative you vertical place? maybe at you starting in already some So progress Can I'd entry

Adam Ante

Yes.

the half on, key now of verticals, that focus of right we about So the it X the overall overall verticals our like And market. portfolio. about represent represents half

growth We're seeing across verticals. pretty So in much outsized key line. some our

creating growth revenue, impacts longer we I as being when across we're the it's then impacts term. really markets how it target in And go-to-market think right think that intentional clients as right, better you experience about about and right, creating products booking about in pace our it longer-term and about upfront, these now that of fits. and the revenue how just the those retention, the strategy

So verticals. I to playing bit case see in think any in that do but we're now there's continue overall add a way, ramp of performance to and how outsized our that continuing right a it's to to those

Brian Peterson

the or terms up it out And Adam, think maybe following anything quarter. we X second rates? you'd that those in X on through kind there of if the the verticals, Or trends you If business or vertical you're curve, the about verticals anything seeing call I'd that. between frame as think maybe about to of going and rest of be of curious you can kind different kind employment your is of that attach

Adam Ante

Yes.

including frequently offering. talent in more well workforce verticals, And that I our demand management, benefits you we solutions, see some the not verticals. think case what we might across more as now, attach see those is complete a for greater where all see of that's as the key

So solution to I having And key terms products see up market good verticals. in of We take to win that we driver and is win the those outsized for we demand some actually more, performance end think to win inside of rate. the there couple a the then those with real stronger and tend rate.

Operator

question our is next Suisse. from And Kevin McVeigh with Credit

Kevin McVeigh

seeing Because $XX XXXX. Was that? that target always you was revise talked that? PEPM drove I a It if in to it what Or looks the did And up, before. like that revised potential you don't case? remember

Raul Villar

we continuing had to just target that that progress XX No, last show drive target. make the that's we're against -- we've for to towards. And that months the

gap. think inorganic adds between increases organic $X continue platform. close through the or PEPM year the to We've I to per we been averaging and $X

Kevin McVeigh

much way to is then frame the tax work quarter? there onetime And how Great. that impacts any

Adam Ante

given market partners we've that becomes revenue well. a to explicitly. we out of nothing it's mean mean, of in how part go as terms I through the Yes. it I

partners to work other we have tax platform. areas So of well the support ERC as and the as

sort historically it's in be support of for its to to able sure. but work terms of line tax in So it's the contribution been overall, helpful

Operator

question with Shah Deutsche next from Our Bhavin Bank. is

Bhavin Shah

provide clearly we and do in ratio, plans markets X then you of kind Tier broker those but into and are those terms progressing? you into these are coverage going X relationships how plan? ahead guys insight logos And maybe are ultimately Where think Tier relationships how of You of in new translating your your revenue? can relative about some to

Raul Villar

Yes.

slightly -- we're internal ahead our the our target channel. in broker So targets of

feel we market, And brokers. it with ability expand make to progress just gives we to we X so there. an more more into brokers good meet when with a connect and Tier continue like us And

broker it saw We us And and expand and And so there, in think contributing it's to going levels what's as and XX% gives partnership more modest I the both continue it, year. on coverage. at the local we is national press channel. our outsized us we're results the coverage that overall. for we're for And new connections growth really level up for in happening in nearly to a over quarter, target we're

Bhavin Shah

logo Resignation the new for further terms the the to the given of Super majority seen follow-up, customers just you helpful. meaningful such talent, any existing the but kind of Great coming a and as for guys great of expansions And always changes table things in just have revaluation? sales back as have been bookings,

Adam Ante

investments but changes I'd positive in we've say mean direction. about momentum to see continue do Yes. to and resources starting put our that and at material there. that more point, there focus talked No we this I

it no changes long-term bookings continue the support material in will term. to near growth, those So but

Operator

Mark is from question next Baird. Our Marcon with

Mark Marcon

further? add have Wondering, that of the a me Obviously, out ton income, investing Let have regards at how you would you my and What terms extend great of terms in a with float you're Is in? congratulations. a impact to to to role? bit kind in there program. that duration of the and had to any obviously color more order it does ADP, much grow experience provided kind of they the little change take of in you flexibility

Adam Ante

into right flexibility, we longer-duration that, with The so rates -- course, than the lot now rise potentially, more as -- over -- in QX, really soak. to or up now it's getting of longer actually, just rates. it's majority the duration rise overnight XX% tend The were to to is months, have as our into going go a problem of right of Mark, Yes. of instruments coming instruments.

do continue to longer. into right rates out longer-duration of sort instruments, that's do sort this and be So preference Not lots XX But then would let the -- opportunity really our more we is minute XX, of move longest. we'll of have is then X XX, whether that. the flesh and to than years to

I to now to something to that, on continue it's X right movement see next, and that X over we think work we'll So start months. -- you'll call the

Mark Marcon

but out you a certainly at those to. That's great. appreciate a are you higher until to ahead rates position you level, settle and continue to changes can in want if make go actually I want to that you wait

Adam Ante

rates. mean, XX% overnight range. XX% mentioned, today more in that's that been XX% is Yes. sort like than historically, And Yes, of in I I to

So into there's to duration. longer opportunity move

Mark Marcon

balance this is now the quarter? for average float last Where

Adam Ante

It some was that's it's earlier course, to QX, And QX. little of parts million seasonality for higher where in -- a $XXX there's and it, of QX. bit

Mark Marcon

or past Any at regionals with in-house any identifying nice seeing systems. then new terms now? color whether of just of source wins that to And composition of really You've change the Great. terms of a the wins? all in you're players, it's job in in done regards the legacy

Raul Villar

say, fairly it's in-house regionals peers. than would performance XX% outsized that, versus still But our other consistent. have against would I We we're that in It's I hovering say fairly around from still Yes. legacy. standard.

We haven't any changes dynamics. seen really market in the

Operator

[Operator Instructions].

question next from Walravens Our with JMP comes Securities. Pat

Joseph Marincek

Congrats on and It's Pat. Joey the for your Bengals. to Marincek quarter on

sized do Just the what TAM? here, X Any sort that there of looks opportunity the be overall on the about relative question one to like? Have how think color helpful. opportunity that you would exists Tier you in TAM, markets

Adam Ante

Yes, sure.

those I about huge I Maybe where opportunities cities, us. exact number, historically, clearly, top they're close of but sits X coverage. think don't overall the And market XX those of the market. X/X population mean inside to the it's have Tier XX% had we it's little we've As about overall markets, for cities, the -- very

TAM. big a the overall So chunk it's of

Joseph Marincek

to just all? you helpful. X into you do describe market, change as Super Tier it. at seeing does the then continue And a Are quick that? of follow-up, Got or you competition more the the move sort how of pace

Raul Villar

in Paylocity, set Yes, Paycom most tiers. between see the markets all the transactions. change doesn't in competition ADP, We

as we've changed So X. Tier that entered hasn't

Operator

the have over I of closing question-and-answer end our conference to the would back Raul turn for to remarks. session. like We reached

Raul Villar

joining and support. again Thank appreciate us soon. the about you the and excited in look We momentum forward We're with to tonight. you for chatting business your again time

have to a feel free out always, reach Have you everyone. if night, questions. great any As

Operator

does conference. you. Thank conclude This today's

You this time, and lines for participation. may your disconnect at you your thank

Paycor HCM (PYCR) 4 Feb 222022 Q2 Earnings call transcript