Paycom Software (PAYC) 2 Nov 222022 Q3 Earnings call transcript

Good afternoon. Thank you for attending today’s Paycom Software Third Quarter 2022 Quarterly Results. My name is Hannah and I will be your moderator for today’s call. [Operator Instructions] I would now like to pass the conference over to our host, James Samford, Head of Investor Relations. Please go ahead.

to quarter welcome call. earnings and you Paycom's XXXX third conference Thank and forward-looking statements that the to those objectives call on Private our performance, not plans, Certain Act this including Securities are Litigation made of meaning within statements the historical Reform facts, future expected of are XXXX. related call. represent our statements of forward-looking only as the date These outlook of this conference

our results statements statements are While on with this risks on actual any are Form most reasonable, our the because forward-looking These made SEC, annual expectations the to may believe discussed subject materially XX-K. report we are differ uncertainties. filings and risks on current based call recent including in and our uncertainties and

A Richison, at and and the gross included And schedule non-GAAP that events new non-GAAP to during such of is these Executive turn we Paycom’s except available we or now Any purposes. adjusted press only non-GAAP we You disclaim made including release the law. as obligation Also speaks Chad refer website and date future today’s Chad? showing of forward-looking whether Chief the over do market net statement alter in review our EBITDA, performance adjusted results after expressly investors.paycom.com. any to should is margin President to required measures, call relying information. financial Officer. applicable not consider as certain refer forward-looking is to made the as close information, GAAP statements, the on to and non-GAAP and which profit, will income, these our on issued it today I’ll reconciliation update adjusted expenses. forward-looking gross factors by and and undertake planning adjusted result for on measures or certain versus and financial call, when a of We use assess otherwise, our

strong call another our few on it quarter our high-quality on guidance minutes and joining world-class take then We revenue thank the with Thanks, we'll produces then today. review questions. growth a everyone very focus and James you spend to to that financials turn delivered Craig highlights our and a I'll and to over margins.

XXXX approximately BETI remains with third and our clients recurring employees payroll driven in by revenue half data employees to self-service payroll. on very very with their XX% Our is business center for that is their strong be of million self-service strategy BETI win up feedback in the is continues automation $XXX payroll. revenue strong, which self-service enable came rapid and new quarter sales. future embraced directly At Demand interact year-over-year, of to the of solutions of growth how have businesses our payroll nearly positive. already and

on augment that sales lead brand respective we And sales Our focus penetrating and territories. awareness XX efforts teams call go-to-market the their includes action. outside that with volumes, to and drive marketing strategy their advertising

Our across efforts our is market leads new range. recognition campaign demo driving strong and producing our brand are strong target

lead a in from coming seeing also are organic directly We employees. surge referrals

the and BETI us many solutions, employee Paycom's experienced employees seeking comprehensive bring to current more As into self-service are workplace.

they most becoming the Paycom get interactions. on position their in becoming employees user And current the go get Paycom, to strong or best like And technology. data in Just organization, with and are experience world, users are want backwards move Employee promoted employees don't influencers. new in consumer the HCM over a to advocates. they control when their

on puts are go-to-market revenue and revenue come. growth strategy go us date We year, our deliver back of guidance growth. EBITDA margin achievement profitable the for delivering sum our our pre-pandemic new XX. growth for multifaceted long of XX% financial runway full and should year the to expectations business strong into remainder Based Rule XX% of to rapid To help adjusted results the to we for many a have years up, high-quality and

product differentiated to strategy Craig? expanding thank strong financials experience revenue and guidance. EBITDA cash payroll a margins that, review flows. adjusted on employees Paycom. accelerating employee I over the Craig in focus Our and outstanding call commitment self-service our to for focused growth XXXX, is of With their fundamentals I’ll with turn for to producing our and want and

Chad. Thanks,

to fourth remind Before and I and quarter I would the review will XXXX, my financial outlook non-GAAP for related on be year to measures comments quarter certain everyone our our third that a basis. full like

growth with representing of quarter $XXX.X revenues XX% total strong, comparable of results Third year the were over million, prior period. XXXX very

an demand is gross growth Within XX% strong XX.X%. revenue was margin new third the of total million, total adjusted Our revenues, XX% from revenues and for growing representing $XXX.X million solution prior revenue adjusted profit for being recurring wins. representing strong gross differentiated fueled and Total $XXX.X was our comparable quarter, quarter the of year by third period. the business for

high-quality on world-class in on and we third or the target revenue quarter period. focus year the year to Adjusted third $XX.X sales XX.X% or R&D total revenues of $XX of of capitalized marketing million was Adjusted XXXX approximately margins to $XX.X including portion, total costs, produces prior to million the compared and for adjusted were expense quarter quarter million in XX%. $XX.X in R&D third in the of expense period. XX.X% remain year the compared full strong revenues. million was XXXX Adjusted XX.X% prior Our the revenues achieve of margins gross of

the to million in total plan Our and Adjusted market prior saw of invest with to margin quarter compared and and EBITDA in the to third was year areas expansion sales $XX.X in our that these future fueling investments in year-over-year or revenues. of points drive I EBITDA of the the $XXX XX.X% shares. we net third quarter and XX% total or adjusted the which the revenues million innovation XXXX high-margin upside. share of basis growth. in was reflects pleased the XXX business GAAP marketing am or million are for versus $XX.X $XX.X our period share $X.XX million per share to quarter of approximately continue our gains per Non-GAAP we million share diluted year on in model strength million $X.XX the revenue of per $X.XX prior for third quarter XX based income was or or in income $XX.X the or versus prior diluted $X.XX flow-through period. year million share of per diluted $XX.X diluted XXXX net

income XXXX, GAAP our to effective tax approximately be a XX% full we basis. For rate on anticipate year

of of behalf approximately of We to debt of million in XXXX. $X.XX $XX daily the held clients and sheet. Turning $XXX third of total The average funds ended billion on the was the with balance equivalents cash balance cash approximately and quarter quarter million.

of strength or billion recurring me are revenue growth of full the to the guidance. range let turn billion we year third revenue at guidance. We XXXX model, to $X.XXX Now raising of our quarter and very our strong in XX% now midpoint $X.XXX With our the range. expect year-over-year the

expect of range the $XXX EBITDA midpoint adjusted adjusted year. at We million representing the margin from and basis the prior XX% $XXX in EBITDA point of of million, a range expansion to XXX the

approximately in the at over we the to For of million, $XXX of XX% of growth XXXX, the $XXX the year of rate period million quarter expect a the total midpoint revenues range range. prior representing comparable fourth

the the EBITDA achieved guidance of EBITDA million we Combining $XXX expect for of margin greater now representing Rule an adjusted XX% adjusted our at in roughly We the Rule to the to the XX $XXX XX growth the of XXXX. at adjusted least in midpoint expecting margin, points XXXX with of for range fourth are which million, range. revenue EBITDA than exceed we quarter is of X

long growth. a for have We high-margin continued runway revenue

fundamentals for that, questions. will have momentum heading Operator? continue the line throughout and XXXX Our strong improve to XXXX. open into With we we

first [Operator Raimo of Instructions] line question is Your with Barclays. Lenschow the from

Craig. you, great Congrats Chad, follow-up in on one a for question of kind a environment. then quarter for this

at terms obviously, of lean moment, the like what other talked the in of you’re In about things to talk market -- company demands, like after happening. X that’s seeing that kind there’s the

little anything. that’s about little of in just You like -- terms bit spending a seeing how like guys in are like not you different a possible there out talk Can bit is a the of terms employees people But guys looks it to the you going what’s it whole on then their so longer, of see of HR kind offering? more Is it’s nature the that it? like for don’t holding space. on

on model. So comments that’s first any number the flow the cash because that for the that one operating than Craig, Then question. in lower came

I’m So be hear. there’s there, great would Congrats sure something to again. going on

October deals not have would I around, of far the end mean I And XX,XXX as say, say was. shifting would us, the months the huge clients Sure. mean, deals I last we little I market a though, we're far I into I'll first, employer's for been September for an the mean, I like in as maybe it a moving I it I at moving we tight, us. a little one. more mean, there I reminder, and TAM. only is book there's that were reported not X% forward, say sales mean softening as I would I yet. as mean, of year. still hiring mean market. mean first hiring as And take still

X payrolls competitors by there efficient out combined themselves. we’re the their largest businesses clients. employees And Our making a do have more million having X.X

right short So opportunity not we’re on now.

us don’t slow really see We’re as for would our within efficient I and making businesses more why that control. that’s down

quarter. to the higher, say would made things timing And operating on items and And quarters as the most tax those expenses here Raimo, just third get on was so our of just between slightly the had so that some discrete some caused impacted timing in cash I to and then really paid. flow, here payments additional when additional they're benefits more in really rate of expenses couple the was third the Typically, some we Yes. this we that it And of And stock we comp. is -- rest be it quarter. a relates payments quarter. third but

to nothing items. So really those out X other point than

Jefferies. The is Samad next Samana question with from

just just you. about seasonal seeing clearly If I us maybe at fourth the X%, curious something in If quarter of guidance, so plus is there’s plus said the as help that. kind back Chad, float December the than normalized and actually guidance timing, last staying I of you about anything stronger think your like look Just help I’m XX%. X%. change us you’re year, renewal revenue? you it XX% think quarter? to the for if impressive. that terms go fourth if or confidence plus If normal, even And seasonal the a in growth, initial what’s understand think in above quarter can uptick maybe driving closer strong it’s in first I I one the uplift against comps, look it’s for

late. of I Yes. as a had strong mean lot of we've starts

a the that the us, of start when business, course, quarter, starts, those starts If that end deal to beat the the so all a subsequent quarter, client new we new receive when at quarters, client we a deal for for quarter the beginning for is that of in receive only of might that if The our matter. XXX% we billing If does for by XXX%. size for XX% receive we that And XX% the of client. start deal dictated at that revenue we revenue the of them Then start the billing of quarter, really quarter. we really starts.

layer rate that have do in. some about the increases. as pace. fourth is, obviously, helpful. bat you've They're mean using quarter-to-quarter. And we as client clients So But the visibility the be also driving benefited in. start converting off to do what those we We've the which a layer new I at talked how of product we just would We're our is as quarter those rapid strength seen, go pretty conversions. right from good

And fourth into quarter. strong we're having growth so the

And maybe just a Great. follow-up. then quick

to lapping close offices. getting sales We’re the new

your how on should how there in they into what forward you fully we Are factoring third still gains and productive? And that quarter happened update be about to does Or think fully would outlook? them? room -- any Just productivity the then both maybe is there? what consider for

sit X quota here having has and it backlog the to a the it today on mean to say even I we offices one all as reminder, or I as in call beginning reps that's in going full that in late and up been months just probably the I having up XX we at And reps going the opened quarter XXXX though Today, been right then now, reach of takes offices field. out year and I X we first very I'm I and through think Yes. -- the X with offices, mean, we've of as with the very X our this year. mean last maturity opened opened pipeline X, selling. best would they’ve XXXX. up

the year become then so And exact quota will next the throughout mature as continue beginning them at same end -- and other our of of beginning -- and end XXXX the that sorry, the or at of or them X. sorry, -- offices for in to all one of for at the at XXXX increase have then for and of they other will XXXX the offices

The is Stifel. from from next question Brad Reback

your change Chad, you customers? noticeable in at have seen or any hiring retention

No, any changes. seen can't say that I we've

months would ourselves. little think some you obviously, additional hiring bonuses people we're bit there or far extreme say Now just that might as look would ago doing. what X have. from clients I people it's recruiting not bonuses changes as And I people to of would our even were when pay seeing facing the maybe we're a as mimics the out to as extent, be what

more getting people some companies more level. think at I back and the are into office

hybrid, I more think there's work more if work-from-home less even at office. not the and

in the someone is a provider. craziest that also I can think without any the lot have using by with a But slowdowns to has at-bats of do vendor. our generation. do mean a is I just everyone X% I try So not or our size. only thing again, business do a or we're of our we seeing payroll using try to mean Most themselves lead to market.

efficient businesses differentiated much is both making with the a out very workforce go-to-market success with we very as serve. as more with there having well that that we’re strategy So companies resonating those

with question The next Marcon Baird. Mark line is from the of

tax you’re strong congratulations was my you’re now a the and Craig, wondering rates quarter? add quarter. right get feel might on able sort how the for you I factoring of what us float to me look in filing like the Let for could if what fourth that on or give

Yes.

we're all So we've short point, But disclosed Mark, paper. XX we basis over that to doing an annualized But represents, haven't Those of for the be million basis. some talked of XX close basis on kind achieving. fairly what and every about, points, we each what rate investments also We're commercial in points layer $X time. should at CDs term. our then getting overnights exact are

as types well the are those as So of investments, some X-year treasuries.

we're we're investments at, now. the where that's point. really this of And are those then So at seeing kind

you And the the Chad, selling September terms Great. the of fall in in you’re the you here the mentioned bookings that what seeing then really and in that fourth cadence, key normal strong and like for October. terms make pipeline, of given quarter does season? feel strength Wondering,

long since want. go I I time, say Yes. can I we July the mentioned those a a as because we're I leads been database mean world. of to XX companies We've just of back go for getting from mean getting would book the even leads I I the months recent. our I the will period mean most -- time. mean August, and I employees hit their can and I in sales. a they're lot in largest mean pandemic strong just as mean employees. having from of we're X-month far I back started,

so And leads. strong having we’re

XX% there. in data able -- we in we’re leads, go those as turn to -- client doing Once that really over of able But gather payrolls, of into are information product. we go all that But finding our to influencers using already convert have first all payroll. employees we’re They’re their the BETI. X to as to and points their clients system again, clients. BETI. over become they very own we some and use within them like And We’re employees new definitely, onto a the to

us companies, They’re So that they’re they’re businesses. other into other not is as company. to strategy. bringing differentiated those either any promoted employees that at other doing move with And or get a where

having expect I we’re slow And a wouldn’t that. success that to down. so of with And lot

change the proposition have company employees not value your even don’t the exposure helping those matching eliminating or doesn’t for up you as if with expected you, and risk the be they and suffer really as think of what becomes paid. so labor it well I consequences pay market the or loosens negative associated that what tighter reducing to

question Brian is Our Schwartz from next with Oppenheimer.

those are congratulations And Chad, in or in excellent you meaningful deal changes on an sizes maybe generations as quarter. your to terms any the conversions, cycles of lead through going metrics? the seeing

have up. sizes to Deal No. continued go

So deal upmarket. further about pulled continue be I we further sizes every can mean, talk and to year, how I

big say up. I your change see As let's of And yes. sizes to deal far part there. any the question, wouldn't other And meaningful I are there's no the cycles, been mean cycles, changes the as that. going

for Craig, on got showing Yes, on X there’s done what less And them for follow-up here in you. for the I’m any one you’re the XQ The advertising And it’s quarters. -- just if catch-up your or EBITDA, you the then last has both. business for guidance increasing the spend wondering improvement QX. in than margin, maybe

was just if wondering you have I on target. any So color that

I how ability sure ad We want necessary we the And the similar fourth to have see want do gives we've quarter. would done that. spend, it to as to into we're kind to make spend say increase us of those going if the in ability as we we to past.

Joshua with from is question Needham. next The Reilly

the job here. quarter Nice on

more more additional Is you Or offerings? focus current If your today. have maybe Or it the going modules? at you I like there? just is look an something forward the new on XXXX enhancing paid R&D think modules strategy, update adding

say Yes, it's I would both.

both module to and creation changed. comes it strategy, Our hasn't when adoption,

of of additional for it's sometimes, of example of products. we that products for then we those and call charge and different features an and within And Manager on-the-Go create on we And DDX is them. And product a example create those charge modules a has those could we product that functionality not others. and and a then I return is functionality. name many level an do do Sometimes, that. we features XX have we investment. that do

forward, So it of mix see as us. we as makes healthy for continue you'll to sense both a move

then And Got it. clarify. just to

point for quarter, come likely XX considering On the to basis increase current in out that’s guidance the guidance? the the are you fourth rate tomorrow

on will impact have November time. any mean December in our rate and I Yes. over little layer Those increase fourth very quarter. in

a quarter. on those So impact our have small fourth very would

is question Enders next with Our Steve from Citi.

This on competitive in landscape. changes I is deals, into George want [ph] ask about you for to your Steve. particular, to move market? up any running as you noticed started Have in

company XX just we're IPO XXXX. employee I same We've plus whether or have Not employee talking into were we would different some now the sub-XXX which X,XXX company. But competitors. really. talked I say running from we've had would even say we if -- to the since always players always we're talking about sub-XX you're players, when gone X,XXX about at we would

talking for more, time. long or when employees been very, a you're same very about it's the X,XXX So players

running I the up new we're wouldn't I players. to little that say into old so seeing a And of some we're move would faces continuing say, we're more. market, because

love in mentioned brand to And your then more there’s expand it. the program. remarks. plans any on marketing there to Got kind if a and you of seen hear little that the you’ve program successes I’d prepared

Yes.

update employee the effort big the -- all which XX% when making made or mean duplicative and any usage-driven someone's the the employees all new our really data we've About by with gone or within are where been touch are single what branding shift. without system. of the think anybody there's changes Paycom at changes by from direct exchange, HR payroll. database, I a will employee I I so DDX, strategies looking of And marketing, directly

wrong, is what is going go employees their we'll the marketing the wrong? is do we're And the into ask now the my payroll. noticed their so And I check payroll is they by payroll. if don't employees funny often, fact, person check looks you've no, person shifting It's in own suffered a doing own though our brand toward and as when payroll. fix payroll it is your hey, business we'll the And before analysis, through ever consequence

because the all why so roll out same to not do that employees thing. the they'll And

realized And comfortable own HR we that their so uncomfortable in I as employees the of before, actually to which app when realize and oftentimes the database. we're do with, staying might helping what with retreat and as lane well payroll. advantages oftentimes would the Today, payroll is employees be say, single individuals the we're can

next The the of Siti from Mizuho. line is with Panigrahi question

how has on trending Siti revenue ‘XX? expect just clients? Panigrahi. your the expectations? BETI BETI follow-up. current is what I for then This have adoption you is done a initial this of your BETI ask been to what has do for And behalf I Alex quarter? Like wanted FY Or of performance percent And versus how BETI

since BETI. on not again, to to using continuing mean Yes. every up. and BETI that's getting employees every at many We're leave going may we're last another, good the trend company that's technology. or backwards one so July And sold all is are And I XX% Nobody since they from leads go about is after had does in why go of client in July. current They BETI. clients July that's sold have been onboarded onboarded client last but right

it very old You difficult for phone take to them. do them an app it ask way, off and somebody's the becomes

And so -- it's and unnecessary.

that go continues clients are as within mention so fact increase And that continues already of or talk clients to to doing got did of their usage so, payroll. I up. using XX% get And employees the product. new earlier BETI the continue better already payroll the did you've own to make about at first or their

case comes their to because organization as with impact to mean on the already. is the get to can't sell. the BETI our if for their mean someone of Look, understand the value time. being BETI. I I you positive I strategy. and all don't anything our I today, else about salespeople it's as else tell I And benefits everything so -- well and that employees, mean everything you have

between a strategy we've not it's the already receiving And a within having employer. correct from so inherent a data it's strategy it's continuing fits to drive and pay employees really and are correct that that been their that -- problems

able customers And it. for I pricing the modules? you with does your Got rising to increases to have on ask, how your pass And inflation, price compare BETI your wanted other to modules? been to

I not Yes, fee. a pricing in I mean, BETI BETI from fee it's standpoint. would our substantial pricing say that that nominal with modules compares more

company Our in first we're in pricing adjustments, do of make as adjustment future, or pricing would the based ever was clients. a XXXX. that We ROI should to it did that be talk about the choose to deliver off able for we

create in mentioned we develop I product where we're a and module past, not we the billing. As do that from sometimes,

I make time any valuable, the to through there share that pricing we only we've makes created in on, that sense more that think -- adjustments. as we're value continued able that product it So we've the

with is Bergin question Bryan Cowen. next Our from

like no uptick with what in start the Can comment to to going adjusted achieve OpEx the It you’re gross curious target your there’s in margin added leverage to you year. that. for XQ I’m just sounds XQ I wanted change levels? on margin. to get XX%

the increase we've a the gross impacted year to Yes, on say the we're that our next I of the catch guess, operations the couple past, group to able towards end continued would that to that the be be bringing and hiring of things I had. we've in have year. In would margin, QX, revenue

in well depreciation. gross impact as a We as something the that's small data online. on had the Dallas margin that's brought center So

always is So then efficiencies that And look that the pull, we we margin. depreciation for impacting the in gross levers model.

of high-growth company. So -- of some kind a for but want we're sure get We have future. can we at to we'll investing maybe as continue year the rest the where throughout make look continue to the efficiencies

in high, past made understaffed that gross statements up margin we be is We've shows our too if operations and way could it a oftentimes in service. about the little

of And you means ahead And people that as so then we oftentimes, that get start downside, begins little to and those growth. hiring load the in bit the on that change take some growth when a toward come we're it back. full see of to it clients,

say follow-up pace? makes line you’re the then just newer offices just than a new you And ramping seen? the sense. offices. in Or what fully guess follow-up across on I staffed those parts different you’ve Okay. is that with sales that, faster organization? it would That of a of Are historical off basically these now

more in X back I to is Yes. first -- don't middle more I will been other of hiring. an then believe a hiring? fully shift over I've were of as it all maybe in of employee-driven questions the or know become where that this. easier being fit about we X What staffed, And environment. I in it's definitely X say you like the was we've something job good one, it's everyone mean talked for about last Well, what months, about I hire to I think a of done the

right. That’s Yes.

at selling, I say have offices past, as new comes it more mean, because said continue new I $X year, the fact years finish million it individual. Okay. would this don't And to we're we know said the with that million we're as X always the we'd we've amount we've to wasn't with the than a Yes. past, mean upmarket. go sales had will that did just when someone the success I of in name increasing million ago, -- it's them. they've year someone first that year, sure about an X, sells as after I'm $X after long award the offices, And I product had, in sold. increasingly $X to a the that I always going in that I what rep

when office expect saying $X but from much. going sale below selling new $X not you that million, top a I'm rep, an an would reps you your to average so average rep And have over million a executive

type You would raise raise open expect opportunities to -- that all new the that office boats. we Including to as them.

Our next line Celino KeyBanc. the of question with from is Jason

commercials, I if about Great. on especially I’ve I’ve or it’s more much been been Paycom thinking too know just me Chad, but don’t games. Paycom seeing football Craig,

the advertising strength top-of-funnel coming it really of marketing the leaned we’ve efforts? share. possible of you last increased incremental During pandemic, Is from the capture that seen some quarters is over and to into couple

Yes, marketing definitely and getting how ourselves. retargeting and at better we're we brand

So we're mean And beach of it. we that is sales. of because a feel on those levers softer yes, landing I one impact oftentimes, marketing definitely

started leads that I even to the since has pandemic things indirectly wrong. we their we our but the of consequences softer are beginning dramatically having that able dealing of to just with tired with not -- because employee-driven check of think the come I'm market them changed do going employees call rank-and-file are when from spending

falling fair. Okay. ROI and companies some about efforts efforts that tech With of or No, other of pull acquisition do? back. this guess software for does types cost the of as you that change we’ve that’s the advertising prices marketing dynamic, been I hearing

believe No. I you waste in can still mean I money advertising.

going start. our to from every appointments So leads not ROI we not we It those deals is close week measure an that convert based them of and do change single percent it's get to then and as the metric. strategy. it We how I mean, leads off but only they

effectiveness how changed. -- that marketing measure of we hasn't our So

from is Alex question Research. Zukin The with next Wolfe

you a usually, relative in solid and where we an on volatile say to macro to this season, very environment. just First would say I just amazing continue difficult up that’s quarter. everybody is, congratulations obviously reporting But guys put

you environment a the I’ll how and that efficiency, at to guess, -- this tougher their long had either starting like out, And much around guess start how of zoom back kind actually Meaning macro if Chad, thinking what’s normalized then efforts certain crystal -- if is are of you like around durability is, levels? is I that? kind that reprioritize to helping more if ball you aside, and being think you tailwind for their the in to I you? to payroll your you as with compliments and office the companies refer trend, which Like, about which this question you? more back hiring of to your automation again, look of So

payroll. reason it is do at this it's on systems be be haven't always how The we're overly call makes blah. payroll. getting doing BETI. to been blah, mean in been doing with complicated is that win multiple doing employees I going will say payroll. because their It it own in all themselves. just mean just only Everybody employees blah, only are going started It's why I employees to their own companies sense themselves I

So they their biggest and for I can do people that that especially when risk want to do exposure, this and satisfaction greater back exposure create I they less that They office, work up waking less our into less, mean, want mean to less your equivalates fact less less. do to employees. think opportunities, I with and the them. are

basis. matters I So from us strategic product our going don't move a for to really think it what's in order on

of regardless Now be -- be but labor a is Well, maybe and saying market could tighter is. I the their reason exist going looser of not saying I'm change making you're market? a case deals size yes. now the the versus But to the if I'm smaller what that's in labor -- for the mean

so we them. And that believe and that I provide -- for

that's their as it. really the what's shifted I that driving we've else payroll over giving employee over own that control think So it. feeds and to really And everything

Now work I'm all management where you're you up not you how in showing it the at which are, you all benefits are, clocking management administration ever if employers just added without and having I do clocking responsible are responsible all all all for I'm of end. showing have your going. employees your this and labor but for you your out, time which have which okay you employees expense

And you're to impact Paycom what going your where show and so we payroll. it's how now going is you does

administration. them at how them blindfold in that everybody they it, off of what take and what's it of the going look at down management, get like you amazed market. tracking, better see When be benefits the show much labor I should expense a the gets And lot regardless time better. don't You'll on slowing end,

what upmarket, versus either further the and Understood. at a And the are course to will valuations -- incremental organic XX then particularly I seeing, I would over say XX the approach inorganic they months you as changed you’re innovation? companies with given of that around don’t funding now direction, know the that your or guess if different same opportunity private maybe you how correct if environment correct, next look the is or

think But we that always I we've do I that innovation company. always sense we're to I developed to always mean things look make us. product. said I an organic mean that I've mean, our

our what be ambitious and future. continue in to product with We the we look for

have are more and keep to exposure more risk it think everybody continuing is, company the they and is that We larger And correctly. even difficult opportunity the larger be for the the the pulled to is, it up I market. company paid honestly,

-- have time And larger we less and with the I on. opportunity see of so call going as more to companies you're employees I us. to I don't as goes see companies definitely have think going those we're mean think more

next with Bank. question Bhavin Deutsche from is Our Shah

quip balance awareness on that? it And the do of first maybe what what what X any than things like? XX% on are Like you in? be by can made things that Chad, sense Is that upper the could to of self-service accelerate value those would you the else? look earlier more adoption payrolls, of anything

our from I better mean I a rolling the well. XX% mean impact when clients group are you're talking your to. clients say their would our that this out just believe better the I be getting own. can at it are and does are employee about had I new are something that at as an our employees. that to Well, mean you're -- clients I getting client wanted

which, just And the it's use showing -- from to starting point thing to another you that I'm thing me, it's buy to product a BETI's so I that's one number And very go mean that's strong something, see of getting on. it. definitely usage where high up. saying conversion they're interest. a and

changes? or just talked the follow-up. evolved after of able brand different That’s months different kind at customer a tweaking the to helpful for about go the funnel there. last has into base And mean wouldn’t few maybe come you quick of from earlier a of Are this How angle. effectiveness given these it campaign some your marketing I attract you a bit little buyers otherwise? a of going maybe strategy that marketing

no mortgage, for small a enterprise large person same day, expect as medical No, because correct. a works end an whether enterprise they needs. needs, employee. be thing the I there's such same at care bills, company, all child They company or of the have to same a the same mean their check

for back They're things. work from for one a the So be day, same large work the They the can expect that same next company. person. enterprise employees they a company can working day and smaller company

And employee BETI, so the regardless comes it's it's it everyone. when size. for to of It's for and company's the

helpful. it. Got That’s Congrats.

The next Daniel from is question Jester BMO. with

bookings on Great. earlier September -- quarter, specifically. in call the called and as Maybe Chad, you out about of just kind October -- mentioned the

how you terms linearity, the you other in were quarters? quarter on in outlook? like like third Just the a basis third relative look September, of sort October? of this on business commenting Did book did macro just Or more

is August, Yes. say but question answer booked Well, on could absolutely, took just the is macro is mean, September your outlook August, I strong we July, I mean is, I that is months. are July, October's further it June. most more was the into The a And I strong, go we've so recent so today June. I comment X to in wouldn't and -- so our booking than back past.

as strong. go, to back continued far you As be we've

long And this of sorts obviously all cycles. you’ve different actually macroeconomic through time business Okay. then run for a very

lot of uncertainty like. I about think looks clearly, a what there’s XXXX

you the just to are philosophically, additional to maybe, recession? pull changes? manage either growth? expect in Paycom What how cost you Chad, should that or levers drive What do run So we a

what I as change a mean reminder, we're I little very X% mean I us mean, just based TAM. doing. of the have already for on we

differentiated a product. have We

clients. X.X their X year got said that with million. combine I As before, if client it's count, competitors the we We've you XX,XXX started off

And next us in that. of to think we're so happens and year us is control dependent upon what I

So doing mean, changes see next I be into we're I what from major wouldn't to any year. going

Our next Credit question Suisse. is from with Kevin McVeigh

Was just way sense, modules said, the CAC? logos, give relative to I’ll any And source congratulations add frame that expectations upside? of outcome. you where given And the Great. per new just was employee fantastic to initially you it kind most Can that? of logo just my per a us

New logos.

the seems folks any But $XX think kind New of Chad, mean, way about of to soft of real market any I the logo, the a choke, we any how to as super number the in million. obviously, adoption Because about of north one and And to think in got are about that’s landing. way choke helpful. there that this modules this that’s get and general there that? relative think morning that context think -- is Is to module And itself, then there we’ve outcome. potentially the debates type using? like modules to a based of of market likely is way about on the within the is now to

a That's our this. differentiated on it's But I logo really definitely mean wins going new margin. say people background I about an and at is is bit have we oftentimes we with those I checks, for mean strategy. are growth. really how us impact like mean I of little leading checks many running us, what's look you. which would types what of impact all onboarding for indicators drive our to the have things going that background to

when you way market. that Sometimes to impact on for things being that labor the you in little say of on markets But ideas side be there the I to would go-to that we're say and information us. deals. help to have impact face-to-face going selling market. us And to have and those be a exchanges any except I that we're and extreme us It's going fact other also the to and to be interchanges bit positive major with it for extreme going have some have market could like it our helps normalize on which something how would the what's likewise, and out we personal us, pre-pandemic were on some would have negative really having would

Congrats, makes sense. That again.

Thank you.

Thank you.

last Our Simmons Davidson. with D.A. from question comes Robert

burns strong like as So extra anything following quarter anything years. such I this guide the X is you up expecting in that? unusual Samad, the from in on sequential year your it’s Are or strongest believe, been,

I Okay. of a earlier. bit understand, quarter. kind about I sure We I'm talked talked sequential a matters. in guide into little this deals of start making kind quarter -- When the fourth

for the that If revenue we start deal. at the we of might deal the in revenue the a that. get quarter beginning XXX% that we billing XXX% get this deal. of the get revenue we in even finished or for a XX% starts of let's If dollars we October, for deal quarter the And July, of deal it. at so first get the take subsequent with that deal -- in of XXX% starts if quarters, started of But the just mid-September,

revenue model And a that here. recurring so have we it's

about -- in interest is all that would layer does about and layering how as So say matter. I rates I've also Eventually, how they start talking talked have over in Craig been I well. time.

that platform we'll when subsequent I think one. they it's -- the there'll really from quarter uplift get adds being of But us, fourth the bit start new our a little that the our onto of next receive expectation quarters, XXX% you revenue be as well. for client in billing and

it. Got

their mean, only on kind -- I bit, Chad mean competitive kind moving Great. a versus in you usual And marketing All in commenting right. seeing tell just just churn are you I what of any little have will Any of normalized approach? seeing I Yes. been market. in realize QX around QX. but it’s notable then So that your changes basis recently X it’s in seen I those A same who’s that but switch things, always guess the very we’ve you idea the competition? a I Richison basically they’re increase that front? pricing, any might as

with As been you’ve same the people. mentioned, it’s

new the people. We’re

next year, XX guys. business. we’re in We’re the And new years

in ourselves ROI benchmark really uses with the against we create the if -- current can our about we product. situation the So that someone

use the same get you to one our competitors. of ROI going if not You’re

You’re just not.

all all with think matter. seeing with of that pricing pricing what’s and someone market available else, And going really correctly, changes ROI so pricing. I continue choose for with it them the competitive. no. can our that we to extent the they as someone There’s will things far Other us understand strategy competitors, going believe That our agrees said, more on a does over as than regardless deploy for them make and any they to deploy realize they if that. But they’re

And pricing. sometimes that’s

giving things it’s free. sometimes for And

So it’s kind really it see seen. on we’ll out of just the been same that But depends there. always what we’ve

now over That for concludes turn Chad Richison I session. will question-and-answer to the remarks. the call closing

the and you many Well, presenting want today to success. be you speaking thank TMT In November, Annual presenting may the forward be and in for in to joining Technology Credit soon. with for our at look Summit We at disconnect. Then Okay. all Fargo you Scottsdale. Suisse December, I call and thank I continued contributing Operator, want our to we’ll at Wells our Francisco. hosting meetings all Barclays Conference everyone thank Conference of of we’ll in to San employees Vegas the TMT Las in

for This you concludes call. participation. today's your Thank

disconnect You lines. may your now