PAYXPaychex, Inc.

“In tests where AI was used and where it was not, the choices that employees made, I think, improved their outcomes and improved our outcomes. So what do I mean by that? As you know, you can immediately go to the cheapest plan. But given your circumstances or what you spent last year or changes that may have happened in your life relative to dependents, that may not be the most economic plan for you to participate in. These AI tools' ability to model that for you—to maybe make the middle plan choice versus the lower plan choice—is, like I said, a better outcome for the participant and, of course, that impacts benefit for us as well because it is a higher-priced plan.”

“Our generative AI-powered employment law and compliance platform processed tens of thousands of inquiries this quarter, helping clients and Paychex, Inc. HR experts navigate complex and always-changing wage and employment law.”

“Some of the things we are doing in terms of generative AI models, which we have now released to scale after the pilots—doing voice payroll, doing email payrolls. What we are seeing early stages in our beta groups in sales using our sales guru tool and what we are seeing from a service perspective.”

“AI agents orchestrated real-time information across service and product systems, equipping thousands of service personnel to support clients more effectively. This agent swarm architecture really removes prior friction and serves as a foundational capability to future agentic developments.”

“We received positive feedback on the new AI-driven benefits intelligence we embedded in the enrollment workflow this year. It leverages employee-specific data to recommend plan choices and streamline benefits selection.”

“Following successful pilots last quarter, we are scaling the use of our voice and email agents for payroll processing, enabling service teams to focus on proactive higher-value advisory support.”

“adjusted operating income margins increased approximately 80 basis points to 47.7% driven by increased productivity and cost discipline while increasing our investments in AI.”

“we have actually launched those tools inside of our HR generalists—we are actually seeing pretty significant productivity improvements since we have done that.”

“we actually own the patent on using agentic AI in a mesh form and structured and unstructured data to answer HR and compliance status.”

“We also expanded our agentic AI sales and service tools to the entire sales team with a goal to drive revenue growth and efficiency.”

“We now have over 500 AI-powered capabilities and agents that can drive higher productivity and smarter decisions and outcomes.”

“Now that we are capturing every interaction that we have from an HR, payroll, and compliance perspective with our clients through every form of communication, every interaction we have with them or one of their employees adds to our dataset. And with our tools constantly looking and doing the analysis around what are common trends, we are getting more insights. And those insights are allowing us to be more proactive with our clients.”

“AI really makes—if you are a scale player—really makes a big difference, is what I will tell you. Because I have a lot more insights about what restaurants are paying in Rochester, New York or San Francisco. I have got that data. I can bring that together and now present it in a way to give you advice. If you had your own HR director, you are not going to get that.”

“Our Paychex Flex and Paycor platforms were recognized as industry-leading HCM solutions with two 2026 Lighthouse Tech Awards. This achievement underscores our commitment to empowering businesses with modern AI-powered solutions that simplify HR processes and drive business outcomes.”

“We believe Paychex, Inc.'s proprietary payroll data, regulatory expertise, and advisory relationships create a sustainable advantage that will enable us to responsibly embed AI into our solutions while maintaining a durable competitive moat.”

“I think John hit on it. I think we still think there is room as we move forward as we continue to embed AI in all of our processes across the company. We feel like there is still plenty of room to expand margins.”

“As we embed AI into our expert-enabled technology, we are strengthening that advantage by leveraging our vast data to scale our expertise, enhance productivity, and elevate client outcomes.”

“We are moving from insight and efficiency tools to proactive agents that leverage our vast and growing dataset to complete work to drive business success.”

“in this new AI era, our scale, our breadth, our capabilities from an expertise perspective, and the fact that we are dealing in mission-critical type of work where errors are costly—I think that you are going to continue to find more and more clients of all sizes turn to Paychex, Inc. to be their HR department and to provide them leading-class technology and advisory solutions in the years ahead.”