Paylocity Holding (PCTY) 3 Nov 222023 Q1 Earnings call transcript

Good day, and welcome to Paylocity Holdings Corporation First Quarter 2023 Fiscal Year Results Conference Call. At this time all participants are in a listen-only mode. [Operator Instructions] Please be advised today’s conference is being recorded.

I would now like to hand the conference over to your speaker, Mr. Ryan Glenn, Chief Financial Officer. sir. ahead, go Please

joining welcome Paylocity. of earnings on fiscal Ryan Toby Officer. XXXX. and are call the Beauchamp Steve September call first I’m and And Financial Chief quarter XXXX, Co-CEOs Glenn, on to afternoon, the results today of Paylocity’s Williams, for XX, me Good which ended

days this issued market closed. XX A Today, we results our the the the discussing on be announced in for replay the after tab. of call under will be our will available press Investor release website webcast next Relations

differ including statements. Before results made forward-looking caution statements beginning, subject and risks other actual we from you from differ must based are statements implied to are on which These information actual or the risks those that subject to in contain the the today’s session, forward-looking to results by cause uncertainties, to remarks, these important Also, factors, can these cause and statements. present statements and question-and-answer the materially projected numerous that forward-looking uncertainties solely are during could statements. results

For the additional therein factors to information, to duty other the filings forward-looking undertake update and not We any risk disclosures. do contained Commission Exchange any please Securities and with statements. refer for our

a website of any non-GAAP directly Commission. Please course we is unavailable filed with unable located financial on during Also, and representative measure reconciliation non-GAAP time business, schedule the internally which our financial unreasonable Securities at needed this a is note certain to because measures. comparable these complete refer Investor are information measure GAAP Exchange measure paylocity.com without are their Relations the which press to detailing and the available to measures tab at under to that in non-GAAP effort. we forward-looking is reconcile the there’s how we financial and more will reconciliation of our results today’s release, call, that We currently the believe

our the Scottsdale Toby upcoming Technology to to any in Conference I New be in like and attending attending XX, regard with Please and I Growth Conference November York conference the Suisse us and schedule will be SaaS Virtual November In you’d let Needham will Steve Needham on these schedule, on XX. know time the me events. if at and on January of Conference XX Credit

With that, call to me let pass the Steve. over

and Ryan, joining to you, us fiscal of quarter thanks for first Thank on you all XXXX earnings our call.

the continued the growth and million most end momentum revenue by Our over sales last into the as recurring value of growth XX.X% our the million. exceeded modern strong software with industry of in differentiated providing to XX.X% $XX XXXX was continues QX our guidance year resonate of revenue proposition or of $XXX.X in Total top fiscal marketplace.

increasingly where clients, held in-person The the sessions we Conference, to days. need conference important connect market. theme efficiently retain become train it find, attract, companies in connected and for an across Elevate we and topic the XXX for software more employees, organization. throughout September, than tools labor more Client HR tight prospects to over a prevailing The to leverage talent course the as two of difficult was annual a X,XXX record our partners processes In hosted virtual and of remains has top data and

the level. modern are at product focused both specifically employee Elevate, that company and connected At across suite experience several driving we new HR highlighted our more on enhancements a

want. will postings within in a create attachments advance, tools the communities, whenever new ensure and schedule device, able through ability mobile wherever employees, to engage For and are their clients add as with multiple to employees such announcements they

reviewing, a specific new and engaging editing within centralized for location team. our offers sharing Video, a Premium company-wide and Within content, managing, video hub both

to dedicated create, released edit feature or dashboards, Insights drilling down data use My case. specific newly to clients allows save a our into Lastly, each and set multiple

connect a employees connected with At these had clients are leveraging opportunity saving financial many to solutions services who that tightly is of client to HR more XXX with experience, Elevate, the drive we including $XXX,XXX of that operational and informed with reduction client data from through impressions. a our surveys a employee a insight tool driving over X,XXX is by manufacturing turnover in improvements over and XX% employees community, combination a

and by XXXX This XX to where The Paylocity business the momentum the year. Paylocity achieved the has continues HRIS date, clients you wait XXth leader marks for all Elevate to the we back all create consecutive overall partners product and our and we’ve ranking includes was our helping Fall recently everyone next as thank strong categories to can’t Conference across leader Grid to recognized recognition be Report. best third segments. an employees, again named big for see in A quarter across had parties GX

now would to to quarter. the on pass I further color like the call to Toby provide

to our number desire across metrics community, The growth in Steve. HR solutions, once be announcements posts, Thanks, strong continues their to utilization of of drive and modern QX, connected comments. key our experience employees a the where in including in and reflected more saw we clients again workforce

We engaging terms also increasingly trends strong of and and significant execution in for selling with through QX through for employees look momentum, our across setting continue provide Collectively, up as Video clients to driving XXXX our sales sales their a products our to entire Survey see across we mediums. connect continue both fiscal Premium to a season. more us head market content similar creation as trends in these strong catalyst

Federal growth, to interest from addition client a income as continues recurring the the In increases sustained our interest to of rise on revenue Reserve. funds rate result

investments Given execution as XX% key we reinvest more the continue new to back delivered deliver usage the us, we growth. adoption, help we’re future to the marketing, our and product committed seeing which in most modern and continuing the to and of the innovate industry. success in our of product a plan marketing business, in than in team and including drive market strong this of the to sales of QX product and areas remain We upside front of people, once investments incremental platform in our portion as initiatives, channel opportunity large into as business again digital well

to see From pleased and macro fiscal coming levels workforce across has October leveled reflected this have the in our in season. seen and with sales the our of continue which we’re year, into momentum QX guidance. of selling XXXX increase strong target while team off, rate we very we in We perspective, our a modest demand increase market, a have through fiscal

Great thank in of Work culture for named certification and I our employees the to nation. In’s great than X,XXX strong at receive Best The For in and the Paylocity to Places to Echoing for more Brightest Chicago, Fortune’s Best Built Places Work we Chicago the be comments, like Workplaces recognized start and fiscal externally were Work Best Companies to as to Steve’s to continues XXXX would a to XXXX. all in

to guidance. I would detail the in now fiscal and financial updated to call Ryan like pass XXXX to provide the review results

revenue year. up Toby. an of million, recurring Total for last XX.X% and other $XXX.X same quarter the was period revenues the first Thanks, increase from with XX.X%,

end quarter, come team of in As our to and a top million pleased were strong the above our $XX had Steve revenue guidance. sales we noted,

to in of maintaining we QX industry-leading costs versus was focus year, scaling for levels. basis XX.X% of leverage while XXX operational representing adjusted last on points service Our gross QX continue XX.X% our profit as

R&D by development. we investments research the XX.X% total when dollar significant compared our XXXX of to it year-over-year understand quarter making to fiscal continue as R&D in to incremental R&D, in throughout fiscal what of Paylocity our the investment capitalize. platform we workforce. combine investments to We investment in we is a out and continue XXXX, modern make needs to on and what the in first build to and focused basis, increased we serve And important remain overall both expense On the

the and go-to-market the business revenue In non-GAAP fiscal on on first we regards making the to in quarter, our of investments sales to expenses this XX.X% XXXX marketing a area of focused the in activities, and annual in remain were and period basis, incremental on basis, remain versus drive of our were same On non-GAAP in year, last continued costs growth. consistently revenue quarter an on we expenses a XX.X% first G&A G&A in basis. leveraging XX.X% focused

was basis income and the million covering by end the million exceeded our represented top for of guidance million, GAAP for $XX.X EBITDA quarter million results, income points $X.X of margin operating million. XXXX. $XX.X and profit XX gross Briefly versus of leverage $XXX.X adjusted Our or and XX.X% our fiscal QX, net was was first QX was $X.X

and we sheet, the ended cash and with million equivalents quarter outstanding. In no of the debt $XX.X cash regards balance to

August, increased existing Additionally, through credit revolving our to million. expanding facility we liquidity in $XXX our

costs, G&A team we start our and opportunities and with pleased the for which with quarter to demonstrate happy while year. performance in sales strong made included identifying operational scale We’re another our we’re to the progress also QX,

regard billion in daily client-held income, $X.X our balance QX. client and was funds to In interest average funds of

the We billion yield approximately approximately average average an the yield basis average balance balance annual XXX with a of be an are estimating are with full points. estimating billion be On $X.X basis, in of points. daily will daily basis we year will $X.X QX approximately average XXX

interest of Additionally, not XX include points our basis changes in increase XX points interest basis does includes and this it the XXXX. rates please in week’s rate currently impact to guidance XX December, point assumes any but note to that basis calendar increase,

financial guidance full and for Finally, I’d like our to XXXX. QX fiscal provide

$X.XXX to fiscal of is XXXX, quarter And to range expected adjusted in growth over of of approximately to second total fiscal $XX.X million, revenue. fiscal expected to be XXXX. $XXX over quarter of total XXXX. the is XXXX, And over million in range expected adjusted XX% $XXX the of revenue billion be the For $XXX XXXX or to XX% million which fiscal second the range in $XX.X be is million for represents million. is EBITDA in to And $X.XXX be fiscal revenue EBITDA range or to growth total XXX points million leverage of to $XXX basis approximately the expected billion

to In we us combination pleased our growth full XXXX margin and midpoint XXXX. in the pleased adjusted above in conclusion, revenue in we’re with fiscal raise which, QX XX guide, guidance the fiscal XX% places the represented EBITDA Rule at are results, year to of with our

we Operator, for are questions. now ready

you. line with & Co. Needham Thank Berg come the of will Instructions] go from Please our Scott [Operator And question ahead. first

and of how against quarter, congrats years, all, couple in you so in we great. more to on continues It customer winning? revenue size, is of revenue first to stay? Is related A ARPU deals there should targeting growth taking the today that impressive at XX% best strength Or larger beat about mix tell, helping everyone, think added a of as I really, volume difficult and there your the But can recurring the Hi you questions. be purely in number for customers percentage five-point was least strong? your and growth? focus here, quarter benefit maintained with out terms around that beat, this a in business thanks and a you’re my five fantastic maybe really comp, that

Yes.

So, of two across all increasing, places momentum I the a we from that has overall, us, happens in the of to really that and terms still we’re that per And in platform, I get up you our been is And that. to you new being biggest different able couple talked sales team. and coming having And from customers ways. markets driver point second that. really continue to think in the strength it’s and the adding for success average comes the execution think about, do revenue bring good the we from serve customer

products about year more upmarket the talking that, customers selling over products and of then, customers. to back we’ve both top last existing continues on and those having been initiative And to successful. First, be that the of new new

of you that having as an well. those see customer So, revenue some larger to impact clients per average

question Got there. someone’s in weeks, couple I some areas at others ask tonight I SMB have guess weakness and to Even a it. over got the of has out reports certain macro Helpful. the two And last shown least. certainly

the kind SMB. service all market of You that’s

the enterprise of squarely part in of what end low segment. the think that is I

any interesting I but seeing aren’t had to You suggest pressure no, might call there? any you ask out? numbers all it. that changes The be to Are seeing

No, demand momentum of Yes. the now. type our in obviously climate. we’re this got happy it’s sales obviously, right with What a question a I and of really we’ve an you results, from inside selling would perspective, lot season important tell

January know, time starts. for As you a is big

prior part although more employees other So our perspective. evidence you have from bit significantly sales of is then the the in little periods. no slightly of slowed positive. we as kind versus measurement, that pretty same-store the on remarks, when And it But a slowdown mentioned that still look platform has at prepared think is we clients. at looking did I And a

at that And pretty so we the the resilient have seems it moment. are like clients

all That’s have. Great. I questions. my taking for Thanks

that Brad the Thank you. ahead. One And go question. Reback for come from Stifel. moment with our will next Please line of

very Great. point specifics any around of Anything there Steve, are much. into or on Thanks last verticals? moderating, sort you can clients dig that around employees adding there? geographies

guidance. at the it There you the is situation, small. relatively in variations all our with slice base current board. diverse try to kind that client we across at overall, some consistent representing customers, different expect, look do pretty the really but industries. dice call and So to is industries it at out over are included pretty been might it that we not as XX,XXX There’s really And the looked ways. all realistically. much We It’s in of it in and

So, it’s, pretty moderate, that change flat. we that, was think forward, overall, didn’t going to certainly fairly and going

And August, entered that around there. strategic some switching the thoughts then you in great. rationale the into That’s facility credit gears, maybe guys

Yes.

seen think reflecting scale business. we place perspective, sort that years as the a And update as put nothing part structure continued that, was us we’ve I growth think few was have had an and the saw just in facility and in reflecting grow what I from of the the what just business. you there the back original our to credit of more capital doing of than we

just I the And growth that, upsized somewhat same, opportunistically the I and different. that, we upsizing think of the was So, given size business. think, rationale and scale but is no the it

much. very That’s Thanks great.

Thank that will the Truist. come question. you. moment for One our next Tillman Terry of And with line

Robert research now And on and Starting how capabilities Thanks. out I full of have off And much roughly does device? Dee percentage fit side a one into so carried is development Thanks for the Great. on development for can on Terry. mobile cycle? of Paylocity’s overall the here follow-up. This taking what questions. mobile be things, mobile platform the then

Sure.

So, you employee manager and think a about it both from user.

When the users take they the more that use on mobile activity So, much platform. you’re of it happens complicated who complex can done. things, application, on And do it we’ve of they capabilities if preference that employee more mostly variety thinking approvals managing and millions can definitely activity does of actually payrolls, about administrator, pretty still they web, mobile. than wide of on mobile of there’s capabilities. today, payroll, lot bigger, a a efficiently where comes and They anything it of advantage on on get got the terms your running the got our And occurs on but you’ve the in on that the do can customers have of that most administrator do most for you to web. web HR workflows, because to

on is most mobile employees term strategy be managers seeing in clients, we done so, and activities more from But phone. of and our that your to invest everything our can continue and build part increasingly first of do we’re their more perspective. a mobile long of to And

to forward. investment So continues R&D of an that going be area an

this following how area? Great. early about all And then about general, it surrounding And capabilities as thinking up, how fillable to potential monetization we forms? in automation the should just TAM are in too such Or newer still is you tell? think Thanks.

can create our of a a kind we time. but modernize Well, to SKUs have we’ve experience great differentiated over had also really new the being of not monetize history able clients, and only product that for

really habit got to we’re part can client And going on. doubled actually our working And until And as believe strategy. new automate our co-creator. we we market clients. the a till collaboration, are since And your like of of those we’ve workflows, they’re be We product map products to of concepts sell robust and our ability ready announcing the that an feedback strongly of get product pretty new are important a in from don’t than initiatives is road things those have a and we IPO. so amount we’ve more that that

workflows, on some pretty the think you’re there, we of right about idea. got I flight. we’ve is thematically, definitely are the So, excited and initiatives Collaboration, in automation

some Our the taking of forms of capabilities. are advantage fillable clients

You place, the is using application onboarding see that they’re workflows probably that primary in also often our today. but in

on the Thanks. quarter. Congrats Great.

our moment One from Securities. that for next question. will And come Patrick with JMP Walravens

Hi, Owen on on Pat. for the Congrats again strong quarter.

cloud wondering on competitive providers. a Can give us about I’m So, update competition brief with bit a little about landscape? the – you

over proposition. value we that It environment. are three exist as competitive deals the to our in to that being competitive part clients feel Sure. two, players clients that’s got posting we value in say we’ve they don’t to to even any it’s you against one, share the obviously, And winning different competitive a with perspective. our from lot think the like the We’ve differentiated most, partner I change. don’t than would I We We the back set, typically would all to a very with got that have. we and growth perspective, been were there’s revenue bringing a from and markets, are we’ve maybe not that We see able our key macro not biggest different market and expect. that win new like here, of market. the any nothing just a think but competing is providers of modern proposition. capabilities ability the a clients, up able be successful,

decreased that a or growth experience potential if back guess, XXXX. then, about for wondering how you kind recession. was Ultimate We in of looking kind I further thought instructive predictive handle would at early Software. Paylocity is of XXXX XXXX four through of Great the Awesome. on Recession impact and Thank you. And saw quarters I

employees think just was, I of the the through of Yes. course But of first mean and And best in guidepost continuing for cause the been the commitment us pandemic from the we’ve business, you the across the that I invest of with and and anything I you and perspective. pandemic running mean, across hire I saw growth we operations marketing really come business what in us how future saw consistently product was of through really think clients. business. preceding to I the pandemic the whole from what obviously, terms fairly for like sort had to different. sales impact a from was think also is what macroeconomic to continuing all, our our and

So I really where today, we quarter. we sit feel a just strong think we like had

execution with We’re we’re really and the our resonating sales competitive that seeing, prospects. referenced in that differentiation dynamics the Steve pleased really with the the and market clients

the I so pandemic think growth. with did to in the for invest the the course business despite any uncertainty, way would continuing lot and consistency And of approach think I very it a we of in macroeconomic we much same future throughout

Thanks so Awesome. much.

One you. come that line the Samad next from will moment Jefferies. Thank Samana and go ahead. Please with for question our

Boretz This for guys. Steve, results. for thanks taking Congrats strong Jordan Ryan, Toby, on on Samad. is Hey the question. my

So I on market showing came is morning, want out ask to first as remains been tight. macro, of The everyone on. decline. focused I labor pretty has a kind This question think the the [indiscernible]

expectations? of any that did in trouble quarter, past versus So quota-carrying How maybe you terms in hiring this come reps? do have

Yes.

the and we’re grow, So across and that’s great our join we board. to obviously, to looking teams, for continue people

value the we’re on sales our a certainly for but across competitive I time. the for not opportunistically, up and employees a talented in really board, ramp onboard really including after proposition fairly market. year-end, people sales, It’s typically hiring. about sales. come are we’re they’re with our to getting to season still say, really all that primary that have happy We people would bringing So excited ability hiring

of So customers. to places that our research have lot like and that development and and support includes sales a our teams

to it’s sales year-end, a think busy really after time from we a is into are start a hiring we’ve before important because nice So head staffing And really up got of levels ramp which year. perspective, start going year-end. strong I

the is pretty this out gross Great. And looks and at look of it for gross then the If the I take gross adjusted a business float, margins, the margin substantially increased like your Ryan. back year-over-year. core contribution I margins maybe from

comment the within maybe So I’m what’s strong expansion curious, driving ex can core on you that business float?

Sure.

I leverage, impact obviously, basis about quarter, XXX happy the and, of the think, nice is continue your business and really even with the in game points, So interest to think in I we teams, And increase drive margin some on point, I think, plan. to those in focus automation that interest leverage including income that us, income. and efficiencies, against actual and the scaling driving for really continued

executed our I G&A, results at So back as that we against marketing investment saw and look and you in incremental of and sales margin primarily areas plan standpoint, business from and step and like in think profitability R&D. the leverage the of game growth quarter’s a felt driving we being

again, results, congrats on you the guys, Well, strong time. and appreciate Great. I the

Thank you.

come from One moment question. that will for you. of Bryan Bergin next Cowen. with Thank line And the our

Good afternoon. sales into wanted I you. strong guys. dig execution. Hi, to force the Thank

You have kind reached here. really seem another level of to

execution what step-up attribute the So you this that you’re seeing? in do notable

Yes.

I two categories. probably it So it into put think different

foremost, really marketplace. and first the resonating is in the think I product

challenges of them, is the being able find, a able people today, it labor the being attract to to challenging for, think If you’re still you market. of looking retain that

don’t culture And the real and clients seeing for tools in and so really engage different your to are environment automate a but equation. you have processes that just right drive when you that allow actually create value collaboration,

one. product And helping number win from That’s perspective. I a think so really it’s us

all think two, the team really I executing is number sales on cylinders.

that they create tell story that getting take value can and so and and differentiation. making and the trained people And proposition that’s sure hired

really having sales cylinders, and having mentioned. as force firing great on that all so tell a a it’s combination a And you to is of story

some of client penetration gotten guess, have Video? your where then And the to? base you the Community today, Just Plus, just, total where Premium penetration newer levels so I stand Okay. into do now of products, in

we total do give to going like you everything, at way bought sell, two-thirds about kind client if the you product that size, of we of to clients. the of if our get clients, of think based customer that the think you’re meaning all amount math off which take a average total approaching that we the look number call roughly is up can a of I and range available in to that that’s, you directionally, our we number can to it, and XX%, product to sell you

we’re going new to And on continue product to add so top of that.

And so we Plus, amount higher. runway products are think of take still still that sell products Surveys, fair Video, while some get go there’s a still had to that for exactly into newer, can a Premium and and of the higher we’ve that Community penetration

So become that rate our continue our continue of in an but than even of to sales from customers, at our the sales and team we most that part several growth invested to rest is of area invest for will revenue we’ve now, We our years equation. more a faster new still a that meaningful inside get force.

Okay, color. appreciate the Thank you.

Thank you. for our Please ahead. Marcon will line next the from Mark with Baird. go of One question. that And come moment

where were they And with then selling focused? terms to existing most really on Hey, and now you’re existing Elevate, had the you was of were ended that clients, most good about excited what X,XXX how up are the And regards prospects? gaining results many here. prospects? base excited about the most afternoon element that that what into right stellar in prospects you At attention and congratulations the

Sure.

see terms question, challenges clients. manage We for connect content than to that they and about the kind on of use It’s your is That’s that XX% business. attendees better usually a it. to the way the all of would have see might first definitely what’s that industry of typically happening think idea, across of in end be There culture. some prospects. cycle that think we more in in the the current It’s create we the I less and tail event of both HR to And then, cater engagement, So near the clients, trying value that of product are well. current lot our lot to a that towards how teams, attend course, their agenda. people really of customers can of trends, in and newer get as evaluation really

to So us. we’ve and super been in a event Virtually, to able was do for able even been host successful. people it we’ve great than more person

question, a too. think you I that to had second part

the existing were being you on? And About what going clients, that most are selling attention the the key said they thinking are gaining about terms most Of excited inside in you added in increased sales are season? that selling? modules how What force. this your Yes. you to, of about

Yes.

we’re I definitely product penetration So would say seeing across increased rate portfolio. the entire

had. that So you might that imagine, it things newer different of two knew not some one are outstripped or by really just are as we the is being modules. But might things our customers not necessarily

more our labor also collect while uptick. video for tough our definitely a higher been and feedback a been has now. market. Recruiting Survey product from The obviously penetration. a has to customers really seeing seen We’re with like need nice things It’s strong

in important. three even that upper onboarding more ago, that But whereas, end released clients the it or towards we and was value So that product gets things even seeing automating of years are smaller definitely when market. that, the four even like

of the And Elevate and opportunity So educated the do becomes to it’s that. all you’ve of that to pretty across when that board. them things is you customers, new XX,XXX-plus creating, and challenges good knowledgeable you’re keep one a got you’ve the got find

from much September last that then terms did organic quarter what up of in an was of much employees contributing within contribution year. you back base? quarter? then Marble how growth That’s a this the of great. end did number How per the in the Blue And getting you end And And acquired quarter? up increase existing of the in client rate this

that. Sure, take can Mark. I

impact revenue. of Blue acquisition, So the at as than X% Marble the the of was we talked timing less about

was this that impact one year full quarter, whereas last Blue the was of month. Obviously, the a on just it basis. So had a year, we quarter Marble, impact full

a from exactly somewhere helpful, the but incrementally year-over-year, in but standpoint, the versus Toby mid-single two then point as called haven’t levels, was specifically And to where And was we in see called last had it some year. macro into out that digits that growth positive out. was, one So it’s trended has we number did workforce range. that what

helpful, has off. So but it incrementally leveled

so you Thank much. Terrific.

Thank will question. ahead. BMO Jester the come next Markets. And with One for line Dan you. Capital our go that of moment Please from

Yes. Thanks. thanks and Good my taking for question. evening

Can of in income incremental float benefit be? sort you’re are hiring? deploy So talked that what higher about that to decision of the prepared Is could Is what making the using incremental them. investments activities? that of you you comments, top-of-the-funnel about advertising, the the about thinking make sort some to And variables sort us talk capital? that from that to

we decisions Hey being I future that remarks I people, of past and drive in the prepared had invest a Dan. that’s I environment talked comprised situations to where into with mean, in we’ve growth. about investments in product. marketing And pretty business think and Yes, to rising rate think consistent back the

strategy, growth some investment think So all across there, support continuing sense, it’s course those continuing perspective business. of to In to consistent bullish I the I pretty support from year business. the will and is think consistent it it the an of deployment areas. the and the to year, to the great of throughout we’re be the and quarter, so growth on Obviously, invest hire

at teams long talked balance gen we’ve over things incremental time. look marketing into we of I we as from dollars previously think I dollars investments to would all think have and about incremental investments then And incremental in product incremental things product we’ve that into look about types in are lead and also our putting of a of driving of a year. of the I the talked those this perspective. fiscal history the we Certainly, course deploy back think PPI like digital And

Got there should Is call a there be level Is you’d onetime anything going new can you. That’s context. in appreciate you. trend than then different just for over Stock-based thinking about? quarter, on this any year. past very seen that Ryan. there I one comp you you out? the we’ve helpful on the very And the things are that Thank maybe that. mentioned? Or that

Sure.

think within quarter, elements So there’s some sure. I for the timing

our program We array have broader expanded our to employee base. of restricted a stock

at the a on. I equity we XX% I burn revenue. whether slightly good think other rate those up It overhang, really SBC materially. tick the set. think I or bit fall look may some year around I as of is of feel And this broader think change peer our elements where was that but you’ll versus normalize goes as year year, compensation, that Last see not about about

slight nothing program, I’d tick-up So may beyond that, a you that with call but see out. expanded

very you Thank Great. much.

question. And next the of Thank moment One Please come will for ahead. that Panigrahi with line you. from Mizuho. Siti go our

to, this upmarket, to back behalf in just up go what is assumed raise if as Alex ask, revenue environment XXXX revenue? the guidance you guidance? And I on Hi, worsens, you of pull full would on solution of would also your you differentiated move you into? recurring S&M to increase running help environment more And of to wanted does need the macro FY much I deals? have R&D? rate in assumed what versus how significant are wanted in your a your to the worsening competitors you macro the have the And the win Siti. And revenue? ask, unemployment And how for effect in

All right.

think here. consistent what to has been standpoint. to test in was to You’re But I’m in do how question And with going macro what best. we’ve guided related to the treated I of us. we from a going it we’ve first my guidance assumed I memory think historically, front my

see remarks, it comments to that. prior October, certainly So Toby’s saw normalized bit increase a prepared to July between the and from did we of although growth in we the

And from did momentum took a a standpoint. into assume a team about would We I that our macro degradation account. retention that to season. really not downturn think results. good the good way characterize with about I going are take forward. we it sales feel significant a into headed materially is really from where I what pretty standpoint So impact feel actually our revenue we selling that the has We would

near-term So we’re Maybe you we like, watch if it’s out as watching certainly feel a that are certainly can I But watching question. nothing closely. repeat would something we the next of closely. that that, something risk, that call although the as part there’s

and macro. the of on the last in part, investments jump year terms given landscape in in I’ll rest think, the the I then upmarket of competitive the

I I the point question. has is your first. this case we I year. been that products, historically in that and sales will mean, I think hitting think which And perspective certainly maybe the macro our and think into to lean continue marketing was investments investments

incremental And longer-term we some are looking face look the to a for the we those areas. downturn, there. investments of really the Those invest on growth-driving important as dollars course saw us. areas think those basis, in to in even business. I still the of are deploy We’re in macro the of And pandemic,

terms really in changing. It’s clients slight us last of prospects we’ve And over growing driven I it a the then or see the by competitive our taking year competitive don’t our push which course and there, environment so, environment, is business. of announced the been a there. part And of the I upmarket, think

comments haven’t back shift Going last the great months six any to in so. or Steve’s earlier, over that I seen

So...

Thank you. right. All Yes.

moment next Simmons Davidson. Thank ahead. And Robert line come from our you. of Please One the D.A. go for that question. with will

wondering how the taking if I you in for you how you integration is then it you about are your Marble could win process question. And seeing the along Blue Or thanks existing base? clients? far Are was Hey, into much new performing. you? are cross-selling help talk

Sure.

globally part started Marble open work remote So to go to our be Blue onto to the working idea original in increase thesis, bringing back platform as if the more that would of popularity. was people the you idea of

an countries. And increasing on so in are that is U.S. different employees what rate, we are, have see predominantly the in clients

so you through Blue Blue us equation we’ve the paid really get enters done. And where them the that that can and that get world that’s because Marble partners the help got around software Marble

a have outside of definitely have those U.S. for been employees customers we felt like nice that So differentiation the that’s

platforms lot because perspective. today, we more can a I experience longer Product but kind a are different that bit our connecting. teams time, believe obviously, lot still that It’s from customers a we think to go-to-market more of over enhance you’ve integrated do A operation pretty takes fairly We’re seamless got still continuing of path. and a down for And will customers you’re experience. little naturally employees integration have internationally. there’s that

very we’re happy So with the performance so far.

of front I though. actually in still think there’s of lot opportunity us, a

can inflation the business talk Got And it. of then about the impact side on the equation? Great. you of

Yes.

potentially not impact the a has impact impact employees it an hit so in as client’s think employees. they’ve inflation fewer terms recession, maybe have, historical number as of if and macroeconomic much I adding a necessarily clients of on in you’ve has our So got seen employees will but recessions, we

that, basis, per because per on impacts our we so a And directly get revenue. month employee paid that

obviously the then would and historical would be can to back lower based be one. that recessions. much trace number pandemic, impact happened You and recovered, it off that precipitously But

that On when you interest you’re in environment, by to the flip a inflation high the inflation raising down rates. side, tries obviously know get Fed

employees. people the have payroll to of thing want a ends to be HR be are that still to up And have to be to more I processes a They which so we to items, rates, being first them And able say must-do bit got the They’ve efficient. able done. is have hedge last get benefit from interest they and would impact.

So from selling our kind still important to make value environments, is able through to perspective, customers. of successful grow and being been motion recession a pretty we’ve sure proposition in that that prior

Thank it. you. Got

for the call session. to all question-and-answer over to management would now participating you any today’s back for like turn closing I in Thank remarks.

Yes.

want your of X,XXX things time hard Paylocity. our Thank wrap of work busiest to course, to very much. take of to all employees for their you we other And our year. enter up, all as I I the in just thank interest opportunity thank Just everybody for

conference This today’s concludes Thank for participating. you call.

now disconnect. may You