Dayforce (DAY) 8 Feb 232022 Q4 Earnings call transcript

Hello and welcome to Ceridian’s Fourth Quarter 2022 Earnings Conference Call. I'm Matt Wells, Head of Investor Relations. And on the call today, we have our Co-CEOs, David Ossip and Leagh Turner and our CFO, Noemie Heuland.

As a reminder, all participants are in listen-only mode and a question-and-answer session will follow the opening remarks.

Before I hand the call over to David, I want to remind everyone that our commentary may include forward-looking statements. to differ uncertainties or materially subject Ceridian's could present are to results from statements risks that and cause expectations. These historical experience can filings. reports of found such Securities as description some statements these Commission, and A in cautionary our of and Exchange in filed we uncertainties the the with the risks be

behind release to performance. and Please rationale review Additionally, over call, use available this for our of the with on we will SEC earnings the non-GAAP are press measures describe a press and Both non-GAAP the course reference filings the release non-GAAP these our earnings filings and measures reconciliation full of our metrics. website. GAAP our Investor Ceridian SEC for to of Relations

note, be replay will website. a Investor Relations call this available our final also of As on a

like David. And turn with that, I'd over the call to to

and to will with industry-leading year QX cloud recurring grow. changes and EBITDA, $X results. with margins on company all and and and in XX% exceptional revenue adjusted our QX XX% our a positions up I'll I'll billion XXXX beyond. call. Matt organizational Today our and begin thank you, us information will give successful efficiency help medium-term insights recent technology quarter Leigh Thank fiscal on joining the that reaffirm you our implementations performance, for then provide drive guidance customer continued more by for Noemie us full strength earnings to our for continue and and financial our XXXX goal our today discuss XXXX. that of for will results becoming talk year gross

QX momentum financial in performance. year with happy XXXX report fiscal I'm and that closed to we strong

excluding currency all exceeded metrics. float. XX% our basis, XX% and guidance constant For QX, recurring revenue we grew Dayforce a On across

$XX.X was from by basis million, margins EBITDA were on with Cash operating $XX.X to XX.X%. flow recurring basis of revenue XXX year from improvement XX.X% adjusted million a expanding cloud activities adjusted ago. or a points significant Our gross an

our cloud growing annual rate Our gross revenue billion, retention Dayforce recurring year-over-year. annual at XX.X% surpassed and $X remains best-in-class XX%

demonstrated achieving and Ceridian efficiency enhancing XXXX, In its revenue operations impressive profitability. growth in while

has We to This ex of to created excellent in adjusted XXXX XX% that XX% all float proud at XX%. the our growth an both setup have customers. value very add-on of base. XX% I'm as revenue also team growth year EBITDA the currency achieved sales recurring constant XXXX we strong new customers provides sales to evidenced of guidance what and for and and our fiscal saw healthy for our of Dayforce XXXX by from

the and market thank of quarter ahead my On motivation is to our global opportunity this size and to and for us. and noteI just team, would optimism, tech the confidence that successful the like seize of their partners sheer fiscal commitment my drives year. contributions employees differentiated to It growth our our HCM my another addressable and

customer productivity and has new and the Dayforce. tangible demand actual verifiable through providing for to boost by efficiency in emphasis investment year. our been It hundreds striving better brand of conversations that in that the had is have of company life Our make I customer has adapting reality on of resulted work value is evidenced numerous more increased stories to work returns been relevant. has and This the throughout never evident every success promise

set that apart us I the discuss product market. our continues Next to in will innovation

payroll expanding our of expand platform global and size the our capabilities. we the to new as continues First, to by target modules add Dayforce market

differentiated enterprise us countries. deliver customers. the Today, capabilities to we in suite most and a payroll to solution HCM offer in XX This the market that is comprehensive its unique also allows for global

means database greater market. that and that area compliance single than engine. This solution with is differentiation continuous a Dayforce Dayforce a in efficiencies any solution Another other offers the single of is and calculation significant single

enabled is and of continuous get cost paid customers. lets Wallet, Over X,XXX for Dayforce XXX an an their our signed launch when for employees turnover are XXX engine they customers, and which that us year-over-year financial year-over-year live. to and calculation increase up employee XXX, Dayforce wellness It increase have of reducing our Wallet want improving

to The key typical a and times remains new average and interact usage competitive among employees. frequent registration attachment of eligible the differentiator Wallet user about rate is with trending Dayforce a XX users above XX% month. high Wallet [indiscernible] rates sales

of $XXX XXXX million in XXX% is expect We revenues Dayforce Wallet year-over-year. approximately which growing over

to is side, integrate continue to AI central and the the we into On seamlessly intelligence platform. Dayforce data

managers intelligent provides Our features the Dayforce customers across answers and allows life cycle DEI, analytics and with covering quickly. flyers employee easily questions their newly entire to our compensation, benefits released People metrics performance analytics get search and and to employees more. Also

user making today experiences. have talent and improved best-in-class focus recruiting for We intelligent also added a experience accurate. including needs changing meet more on have to the automation work our acquisition And we mobile process efficient

With benefits the [indiscernible] employees can mobile benefits fully mobile the devices. their manage enrollment, on

year application the to and meet Hub, customers specific the groups. for communications Dayforce put personalized released the their to we And and very demands the suite of core of easily that allows workplace. differentiated Experience extend to at branding modern content last the we And features continue which our across offer on the

open adapt staffing the the a of world candidates we of We match upcoming engine, ideal and models using the this solution Dayforce this and build to intelligence at backbone open shared help future to approach will work. standard-based that our talent Insights. us It engine the It flexibility tech increase talent to marketplace. their skills customers skilled an to are creates Dayforce jobs skills. example, to allows For is of

and due differentiation its drive our and Dayforce the our And technology Services has can Tax submission now In modernized XXXX, systems, the always through out same more cloud access stood will we tax to Ceridian customers North finally, competitiveness. as of This the American growth. tax architecture platform. enhance the

XXXX-plus our of as making Suites again once HCM being recognized Once employee we been for which named with us line, for only very distinctive Quadrant more proud we enterprises, Gartner XXXX as the are leader the vendor in product pure-play Cloud with a such. has are progress the HCM Magic

our and profitable us past conclusion, performance In ability sustained gives our growth. innovation, impressive to year, achieve assurance great this product broad reach in

call the Leagh. over turn floor I'll Leagh the Now, to is yours.

to balanced you, our model in plan. David. investing the adjusted to XXXX constant expectations by environment. pleased growing and and Thank XX.X%. in XX, Last the total We to leverage even continues Like and and business complex I year, shifted a am that our continue revenue of EBITDA so growing in and allowed to operating and profitability Ceridian us adjusted you, with our perform operated in above currency XX% we beyond more APJ operating resources, rule growth business this being Ceridian this

mentioned, And guide XXXX David as continues for to our XX. on of improve Rule the

and continue especially am allowed sales innovation so investment results and that the to. which spoke marketing to engineering, the to hire we side, us going the to sales speak I drive in meaningfully, and On has that David to,

support rates businesses, and And XX.X%. of and in of all support year while logged customers maintaining time we meaningfully both of our by and the the services XX% our NPS business, driving while support customer across which did this and globalizing scores tickets also decreasing we up number at in our world-class same retention way service the our

to with of continue more significantly that's grew more than beyond. We partners in ecosystem trend in XX% that by increase than globally. year in XXXX global supported of bookings a now XXX XXXX partner will and by partners our Today, were and also our XX% and completed kickoffs our are partners significantly

our pipeline We are seeing in as partners the well. our effect of

Our and deal pipeline strong and and medium-sized in increased our support all Companies maintaining our for the saw And average overall of globe going our coverage we transformation, leadership, size signaling growth companies. employee to tailwinds drive of reaching of required to by globalization anywhere. are and XXXX, segments the and these their high. XX% markets, are small- efficiencies maturity digital of in level is growth. efficiency our not In in XXXX, our global the parts qualification of upmarket growth and triple-digit base while is pipeline sizes,

fact by spend In says, technology SaaS that year-on-year. increasing with XX%, are IDC growing XXXX in budgets approximately

prove We seasoned and will entered sales year a organization. levers to to time. ones with the efficient right growth the the at be right continue Our

and large enterprise and the We strides strong have market. particularly with pipelines, time reps as make in demonstrable territory we to continue

XX%, Over XX% These our base of of back sales, well this to are strategy have the customers suite. of that in platform our Coupled the term. were Dayforce and XXXX, rates our medium us for growth over positions excess fiscal in XX% works. our with points, proof retention bought durable year

happy satisfied profitable customers long-term drives are and the innovation, combination Continued that growth.

UK a customer a transformation growth hotel leveraging multinational manufacturer HCM with company employees follow, engaging perspective, America, XX,XXX further deal by and some brought both our in auto into Now, to the chose restaurant QX and a wins modern, business of global customer a to its a and North will employees. and will single From the of Dayforce This with experience let for partner be its intuitive specifics go-lives. Ceridian, on done was by Dayforce. workforce get the us unify parts a its XX,XXX that fuel in selected and to platform, partner, by based and process me the wins transformation

single America XX,XXX for Pacific employees and consumer management, Latin standardizing Dayforce operations, organization. a payroll lean driving A goods global and solution with more efficient for manufacturer, a US globally, workforce and chose and on Asia its

airline on key with part XX,XXX brought our by their selected business. and This was us global major deal global the in to efficiency processes, same partners, based to Canada, in driving partner. that one A transform WFM focused this and of Ceridian of global employees payroll

global this less months. teaming XX,XXX both went in sophisticated and streamlining signing in the recently and We taxes Canada. possible. requirements and be payroll one very This than in our live, firm quarter. from and to between made with the employees They also excellent Dayforce, notable professional customer last to some took live, of Ceridian customer happen for had A also services went partners. They nine the live companies US

for express modern companies the Dayforce employees. time a and and the experience in payroll launched for United employees successfully management Kingdom; payroll for leading for and retailer, workforce American and and and Dayforce shipping X,XXX HR payroll airline for a transportation global attendance passenger benefits managed of cargo One major migrated Dayforce, migrated XX,XXX to XX,XXX A for world's employees. largest to

those you in anomaly noted employees some the few For We've of customers this results. us will all would an relentlessly that you mentioned virtually ago A scaling business now norm. and been following and for this the of the it's have excess one focused on have been this XX,XXX. of have is of time, years

President, to Global to scale, to and Steve In pleased look Speaking role, fiscal share we our Revenue very field of Operations. the Customer I'm new lead Holdridge as will XXXX, entire of promotion this global ahead operations. year Steve

sales, We through the the and point our known single to toward is that that to to the growth we and drive of customer our was promised this delivering we functions the value time customer right structure together toward and continue bring have revenue to experience. goals always intended quantifiable touch move this every

To support efforts. marketing of this in resources support go-to-market new structure, our also allocated additional to we've brand and

real of business providers are We transformation.

single bring help a at leader of and moment these every the when partner to growth, to Steve this for efficiency customer everywhere a And convert them meet together is opportunity. is to searching absolutely into help teams us time right

transformation Ceridian joining of both industry to Steve latest well four inside is take us. to for Ceridian exemplary, personally would well record endorsement our since joined known leader, and he behalf walls. in track congratulate leadership. on global the like to of and prior all his this at in A his loved opportunity I of true us His this years

evolution over organization who grateful revenue I value leading value Before commit March X. the would to they him up sell customer set working in for and it Rocky next Rocky and our turn thank process our to was we Steve ensure like business renew. the truly to to will leave of is contributions I transformation, stage this instrumental numerous when live us wish quantifiable we to Noemie, on that Subramanian, with we goes side-by-side He and our are again sales for in realized when well. the his in our

demand In healthy. remains the closing, environment

market Our strong. pipeline growing. is The is opportunity

their the is for cost. are powers customers renewal their productivity ecosystem our and reduces best-in-class. efficiency, and accelerates transformation succeeding When we remain their Our and rates sustained that growth, reach answer expanding and

and Above purpose, all I customers commitment team, their completely our promise to along right aligned else, deliver, we didn't better. stop shareholders have steadfast brand to further life if be remiss who the and would our to I make with for to think, our work

and I review deeply through turn quarter our Noemie walk the and And with more will you guidance. the that, Noemie? over to year it to to

provide to in full year website. release our on like on I'd both which and Relations of performance are detailed Investor Leagh. XXXX Thanks, fourth color additional quarter our press guidance, published the

As David results highlighted, metrics FX currency, quarter grew headwinds. guidance profitability exceeded revenue recurring persistent Dayforce grew across despite Notably, total our all XX% fourth and revenue at and XX%. constant revenue

the XX.X% basis QX was cash last recurring gross range on operating flows Our was high I in margin end our an million adjusted that margin report XX.X%, and the EBITDA an points year-over-year. pleased of operating to basis, above guidance improvements. of exceeded year, upside part by cloud revenue adjusted and margin XXX $XX.X am increase very driven of

in change the estimate sales of from we amortization benefited of commission million $X December, In month period. also a

deferred estimate length our fiscal XX-year period, retention rates higher relationship. customer our guidance. year five-year of commissions a is 'XX reflecting our a estimate also embedded now amortize change We from over period, and revised This of in a customer will

Turning will 'XX impact FX to year for the felt year, we of then to we primary The headwinds. the the about expect where about to ex half. guidance. points fiscal being total in points of trend moderating headwinds revenue XX full second basis revenue, XXX FX I recurring float the year, half note first Dayforce basis across that the with of expect total same in persist want

at of the in excluding million constant million, full expected currency. $XXX XX% revenue year, is the at recurring the growing range to For midpoint Dayforce to float be $XXX

As noted our under our Dayforce release, now North in America tax and provide tech the we our modernized have infrastructure solutions press platform.

As this points business revenue in XXX effort is contribute of recurring basis ex modernization in 'XX. such, tech our expected float to fiscal Dayforce growth approximately year

And XX note full largest float over reflects like revenue addition, In months our take run enterprise environment. our to rate a would more achieve that deals, revenue. I interest guidance to total normalized

expect pace as less XXXX. increases As fiscal we compared moderates, rate of year the upward to variability

or expected is at EBITDA $XXX margins of Adjusted million to in of million $XXX range the be XX% midpoint. to the

Our of by reinvestment business, margin guidance expansion. a scale, recurring as back as degree primarily gross cloud into assumes continued well float driven the

ratio cash we in for flows, an mid-XXs XXXX. As year operating it relates to the conversion the expect adjusted EBITDA full

Commensurate closing, progress to in that and we like XXXX and our Leagh to with shared our proud we implied our remain echo committed as progress very eager medium-term goals. by In made David saying in made we're 'XX XXXX the and in I'd XXXX. guidance, to both on of in are continue executing vision

turn to to like back call to I'd for over Now, it the open Matt Q&A.

Hello.

Our first Mark from Baird. Marcon question from comes

attractive It your shine What speak regards competitive growth internationally? afternoon of there? And smoothly? that as was I really I it have the able talked of global very complementary. like that nature. the is with opportunities. terms enterprise good engine? When of an it then key various in them marketplace what talk number well. would multinational I sounds as calculation single were Can a that at noticed and extent and native And the obviously global were Insights you're relative a just clients the sales And opportunity Dayforce it payroll in that to congratulations. deals. highlights, country drivers seeing with single you everything large are Hey, And mentioning in all to continuous the you've you bigger signed. lot database? the to the you're a bit advantages to Is Wallet of about the to what translate global little Is being Is the deals to deals

speak looking companies are their would they and now how is this move transform advantage you. that take with and say can organizations about great What at in most relevant Mark, one on to world. today's to are basis. at initiatives I can Thanks is to model how line On be that shared looking the most organizations services global operating a of that they

them sites allows single are a on more shared them organizations all because initiatives. analytics It for a to in standardization to in beyond with payroll system. Dayforce strategic allows have at finding to them model like currency, the we're to do their global constant provides operating and services using the it and altogether there it that so work a areas certain And allows them It technology, looking process achieve people.

very market. And so the we're Leagh, add finding that's inside what that? to nicely resonating would you

of First press we our refer you all, you. from what at I to and would global customers I where David release would a one about talk Mark, hear of you. it's time. said, just nice Thank beginning are country And sort to that echo

I something well. seeing think as that that's we're

in that large in order employees pipeline that global in a David but are say, many XX,XXX achieve have with employees we're to what North companies actually is to refer to global seeing XXX,XXX very globalizing They we our right America. very, auto manufacturer You're efficiency, parts multinationals, globally.

a that in employees to globally. and refer global We with XXX,XXX employees XX,XXX we live. They professional services have brought the firm US Canada

expand go-to-market of huge So should our and more and over land of strategy to a you is see part time. this expect that

can capabilities And early clients. in put the to access are listen helping just company for large Dayforce great. what extent wage Wallet their That's just to European European place you staffing Randstad a mention

wondering starting outside some access? I'm of it to see US to the what as relates So to early traction we're wage extent

event as media, the In the UK Dayforce Mark you'll inside biweekly if launch see the in with a weekly they Wallet or excitement and tremendous UK market. LinkedIn you was big look are and as monthly it on well-attended typically to did the that North payroll periods for opposed the populations in social or we of America. tremendously Europe, are

are obviously, have, way along of We a market. partnerships doing we the movement inside it for demand the of the big it to money. because a is pragmatic have there in So,

UK of as XX.XX adoption currently of look what encouraged we and that system. are it. the geo And very Germany live, the with seeing we'll probably kind we bring we're so, towards And adding

the is market there as a requirement wage as well, well the within early are obviously, We access also market. where APJ looking ANZ towards for

you. Thank Terrific.

from Mark. Murphy of our Thanks, question next And JPMorgan. Mark comes

strong the you Thank Yes. on much. very guidance. very congratulations, And

then, of that perhaps of I do registration revenue First to maybe to holdouts year. are is this some potential would of to follow-up. what happen? see the to you And or of all, the be get that a -- next the have wallet $XX users, and assuming see XX% quick it's what the if the rate was continued curious, hurdles convert I great billion eligible expected around

per So sure, the not It's wallet. Mark, it's it's year-over-year. XX the the still early of crossed times if a If for we've application number volumes correct, at the loads I'm not days probably few the growing XXX% is I well actual we day. the if XXXX loads, time billion, now, X-X number over XX,XXX XX,XXX at around daily ago. loads got And I look beyond or the to of months in actual look frame. $X used we're

very So, of -- what I about know in quickly. from I the don't X% comes about size guess less a it the of it's is But overall now, revenue contribution, growing percentage it company.

Okay. call Understood. it for you Thank didn't I that. the on you David, properly. thank clarifying. hear for clarifying phonetically

the it's have was of non-farm you follow-up, the seeing or kind were rate how you And recent view, that you since backdrop number. overall and you a do hospitality, high something you're did exposure. instructive the Unemployment where do or as Is I payrolls the noisy today? late XXXXs. on think think employment there that I data. strongest a was the relatively anomalous, As lowest stunning believe leisure It interpret monthly

about talk and really QX. remember up employment of of you'll hospitality have December, you see seasonality highest as starting that, level drop-off you again and you in the those a of that segments. begins build the go typically And QX retail. through particular to then Typically, didn't They in with

pretty didn't by see I the to it segment, surprised as by remember, I So, by geo employment wasn't -- when we have well. data numbers. And numbers comes live

expected. what had we it's So

very Thank you much,

Thanks, Cowen. Mark. comes Bergin And next of Bryan our question from

Thank afternoon. I want with good all Hi, start to I you. guess, demand.

or on through behavior January seeing Just maybe would Anything, new like are Can momentum slowdown? recessionary that? KPIs that business please? you comment suggest eminent you any

exceptionally It's December sales you into continues sales kind the of a January. through after didn't typically on that. back Usually came throughout The beginning the very sales right a busy, bit Thanksgiving, of month team active, slowdown very, activities and towards in strange very the see was that Solution we January. December, of high the time. end. then of see cycle, very, Advisory Last And year, activities a

very deal, is value get become system, the several IRR in a to that for single very economy. still the that delivering projects. on our I be in robust will customer amount times slowdown very into to each is important the definitely is company focus think quantifiable I and inspection diligence what seems the talks to though side, the going a specifically type the in of on there the I words has the other order at say that doing every up for But anything market So and approvals every is can't the hard macro speak to to of

helpful. That's to then margin here. And pivoting Okay.

the So sense that here, us from commission expense XXXX close recurring gross XXXX? expect ex-float land Can solid you to what is then change just impact in of the give amortization. in you do the a just that? on margin And where cloud

Yeah.

latter. I'll with the So start

the about look of you at a $X If million… it I was month December, think Noemie

Benefit.

assume inside for extrapolate we that. just the year. I …benefit could

XX% the up for I the that X% last probably progress by entire the about In we at basis towards hitting year. to up year terms X% that mentioned as we relative expect margin which QX to would probably XXXX. between the look points. to gross rule of would year, to If recurring, towards XXX target ended XX.X%, we're on And basis go was adjusted you -- expect we the would make it an us QX, on of

probably so year. the And or the about up course another it see of by percentage so you'll go over

had that's we've going XX% and look to you Yeah. to we're gross always it year to in And make did to Bryan, out pretty APJ. XXXX linear and until be automation, using in that flow, of gross I XXXX, think comes may when said close centers remember well then. we at as by with the as a in cloud increase aiming recurring you best it our progress we're the cloud at we when be shared recurring work if every progression, significant that our our we pretty going margin come margin look to way to services

continue It's see to of and throughout of the we going an reach XXXX. you'll be progression more So see benefits we to XX%. in that but impact XXXX, less linear going forward until

for Okay. Thank you the detail.

Just believe one EBITDA plan opposed to XX% do to on thing sales range do the would that that end long-term by XXXX. the is target I of moves adjusted the XXXX the commission as I -- with changes

So it brings it about -- it a in year. by moves the

Understood. Okay.

Thanks Bryan.

Our of Bank. next Shah from Deutsche Bhavin question comes

for question, quarter. congrats on a taking my Thanks Great. and strong

under why to on of you just it's some more of elaborate you think on potential maybe of are if the little the exact about how versus replacing a disruption Just or bit best you Steve, changes then following the at all? maybe And just thinking up made consolidate CRO maybe that you on him handicapping any promotion can Rocky? the for role

Yeah, that. I'll take

allow in eventually. it, about you and we -- able we us to the the to alignment to In allows be go needed the a it's years functions. the always First four know we structure because stability visibility be wanted you entire like noted to had this customer order that cycle. talk and Bhavin. David structure David I to full and scale I'll do we able a to call. talked model we very we fact facing I journey And each that on to a a of life few much. have to But don't ago We that move do say it and what about moving to that. of nice complete of customer Thank knew things this, to toward that -- all, target during throughout

value lot our customers. We care quantifiable delivering a to about

it me value throughout go-live that measure it value. for market partner, that partner, to us measure cycle believe partner, sales on differentiated. us process. make quantifiable will or to the we and support renewal can to the but And partner, actual we process, then to the life sales services focus allows believe process and the this be that it that in So the renewal that not consistently to we excuse transformation life allow will set -- can we bring transformation us through partner And deeply the be through

will to there disruptions. He Rocky to I our do, say And here last the is the lion's upgrade you through what will to was way globalize asked as I an aligned, did also and say value-based North we leads this couple increase team as would that us, would Steve sales. zero entire years. out with of our selling. change. our and He have awesome American well and share us Greg business through all him of years who which that's selling and know think I did of George job. was is be with for exactly couple today they this transformation-based been a

the couple of last working Steve I little-to-no And really for partners customer entire life leaders. a think he's that on built the quantifiable will all. disruption value great culture, think have great he at be And throughout been years that cycle. there And and I

our of change and into efficiency take business the investing what as we've brands and this our story. a and it telling back some so do been is to drive to in And result savings of able

forward to momentum. frankly think I going see we're So

we're and is happy the As like and team upwards. a onwards result super just

Appreciate the response, Leagh. valuable

of between maybe should XQ to roughly this help mind one implies three would beyond. maybe going million question year the you delta Just that into maybe in I versus the on full the us guidance float keep to follow-up. of XQ quarters. understand forward? million should Can if as million which just we $XX Anything $XXX go following relates that as the be we thought it stable have anything for $XXX and

and the reflected my less -- prepared than we and variability higher in going bit into on I QX, environment rate with said tax to well. you seasonality we've we the of guidance that the rate our upward processing volume got as -- of little QX magnitude there's But to a interest on And on be XXXX bit going starts a most recent then it as remarks, end think interest for environment. the in volumes as the I XXXX. year So of to normalize factored XXXX is for simply because the was

you again for Thank questions. my it. taking Appreciate

Thanks, Bhavin.

Robert of Our comes Davidson. D.A. next Simmons from question

questions. you might native my add I Thanks have relative in taking to term? payroll Hey. the will for to wondering of was [indiscernible] that what countries you near

I sorry I'm quite the hear question. didn't

relative we countries the will think. natives I payroll What near term to add in

extending the of end acquired. the to of do the with quite get already you customers We've At it the starting same backlog GA Well, across have to will we a through the in to time, year. as already online. We're at this moment are we And limited footprint go go Germany. charter a focus our through, as implementation the year. release for we accounts Germany got countries know that is by the APJ the

platform. we're Singapore you you our in are GAs acquired if So global Singapore continuing there already very as and interface, the year the last around us to Dayforce we will launched invest which nature are similar to bring into probably allows we've we few add. payroll that And that in a engines like know to

seen competitive Have pretty usual? is changes that three it any sense. about And talk months or out, you Got landscape? to you'd call you much in makes it. as can the six then That business last the

we're not is say, that variety know space. – emerging in mid-market, in In same against And an You leadership I So emerging we Quadrant, there. end large the segments, the SAP say, top that now, typically right? when market, up very I I UKG play the growth are it's we which in of Workday three wins who relatively had our competitors landscape. press we alone Magic very of traditional continue the was win were now But competitive changed the in – we clouded great get Gartner would different quadrant we manufacturer playing noted we into ADP. to the ERPs, example see demonstrably. the But a and auto would global in parts with. would as release, many the say, a the see

and at provisions we deal look against explosives oil that was done a multinational ADP Australia was it gas New partner-led. did global days the with competitive That was and markets. Zealand, deal multimillion gas does dollar in XX and – for that a deal, the mining actually and you in that a and done of When oil

cycles so you're the than deals would past one that in pre-qualified are the is competing the more same accelerating. not our with in we're partners the our we I degree sales working that we're say But And because thing are and to might much, really past. perhaps seeing demonstrably that have

to result, our we're a able value Ceridian. customer but As maintain our to only to not

Robert. Thanks,

from comes question Siti next from Our Panigrahi Mizuho.

my taking question look I for impressive. we Thanks Great. very enterprise started pre-COVID. And quarter. and David, it's remember you Great when investing congratulations. momentum, at

momentum. size For seeing the large few quarters are this last we deal

into XXXX. XXXX year. heading is for deals? the And the right large pipeline these cycle sales last like now us This deals So enterprise deal how time remind what's versus

that. much very thanks for So

that Leagh would would which that are things here. last metric There few went deal a So look be I to to is that XX% average of in kind spoke parallel year. by point the are size running the up

First a in-seat of team. all, and of sales we enterprise have large kind enterprise

than with generated that is several we over that beginning that we and the the team business last the pipeline the that development And been larger so enterprise of has by went organization an that go into means year at pipeline XXXX. one times the into XXXX

with more sourced large large few of a by by global That manufacturer large those, also automotive we've one we're Australia that is about organization. Canadian the also the Leagh deals made tremendous SI’s. seeing and integrators. of sourced The based being system progress organization second that chemical the system the integrators spoke by of another was another was SI. large The sourced was by airline out sourced SI. very The

as which And the the positively SI channels investing been being pipeline know by in last you so we've we're or now influenced four years. three the for probably seeing

those into and year much of together, you take pipeline. with much when sales we So a more all go healthier robust

actually I somewhere probably to was was XX quick, contracting. In chemical terms at it size lightning average that a look really the to XX company identification it like of from If weeks the varies. deal

six that think look is I most I which at the the was are in also about at the pipeline. terms outliers. If move through employees those months I probably airline company, about XX,XXX But time of think to

with the As populations you taking of would enterprise those we've the expect quickly. very would in point XX typically very large do to be the live large One other gotten to types I enterprise space it And would side, implementation. has good at very months make mature XX opportunities. on large to

Leagh about all. XX,XXX an And spoke not is consulting that's The The employees. so off April kicked and about which project they in or at went anomaly company December. large live in upwards that, of

what we're basis. in So the enterprise seeing I'm large with encouraged very

That's XXXX? else? And professional there we talked the great reason revenue revenue services as about think And in services, getting the services Is or year-over-year, professional the follow-up X% involved about is that, for revenue was color. you Dayforce that up to SIs should deals. anything why a professional how

to integrators. the Yes, we don't you're that year-over-year. is system of X% primarily, it amount. the trying is if talking actually are it's projects system of is more-and-more the I a of XX% I you the yes, about XX% integrators to inside But number look move overall the And are think that up now was implementations the quarter. But it basis, correct. I think at fiscal for actual by think --

XX%. Yeah.

XX%.

to we in quite so again, XXXX. And expect would significantly that grow

again. congratulations Great. you, Thank

Siti. Thanks,

William Our next Matthew Pfau Blair. from question comes of

the I for ideal marketplace. question. wanted talent on a ask my taking thanks to Hey few the

terms go this meaningfully? labor environment? When thinking opportunity of in do you a Thanks. you you start So sourcing labor product size? to how this would expect for about this contributing in about And to tight its revenue how then, are

on We're we before a that. So be see benefit the question products. thanks time for revenue it. from will It the still out building some actual

be terms are, time line. the live of able QX, expect accounts the charter where take we to in QX to we In

already active company. actual the of the the alumni are be the first the as of of as labor that employees sourcing company terms there well In employees the two classifications of call of which would known We people.

call skills for skills we've people done background so something which do then And the screen will are done the to the that employees be we we trusted actual second matching. we engine job use the the categorization validate particular able their can have

of where contracting the getting few terms customers the clients the first stage, In in the accounts, to of next charter should we've identification speaking and we to months. start to be them position few in been with quite our a active in a

it. Appreciate you. Thank

Thanks, Matt.

Michael Our Turrin comes from Wells next of question Fargo.

Thanks question. Employee year still is great. taking for growth the Hey, the this Appreciate it. at platform XX%. on strong

release Noemie user just you what's that Thank You assumptions environment give as part the maybe secondarily, some walk of a some the details mentioned fiscal the in something migration the Is the you're in XXXX then environment And employment as you're healthy. driving us through driving maybe the expecting that you're or of matures, making base there's you the looks press can tax Dayforce impact on guide. mentioned guide? revenue seeing that? on you. still now? Can what's

Sure.

employment we're bit Remember last year pickup of expecting from employment little assumptions from to recovery COVID trends normalize. in David the had to terms the So of period. we it in still the level QX, referred earlier, employment

slight in normalized picking completely then back a in QX We're decline that's and So expecting levels trends now. again. seasonal up employment

the So embedded that's in – our PEPM that's what's for XXXX. guidance for

about – about This tax and is infrastructure. than done modernized our the what we've in no past David from on-premise more effect for talked them to with the the tax types we where too, enabled and the on talk this but we we've migration, different existing And cloud of our really margin profitable customers us delivery well. as we've can customers, an that lot generate a migrate into Bureau

revenue grow about it. to we big have in because customers plan differentiator Dayforce really growth the to well add That's basis of points XXXX. we marketing a and that XXX business That and David, there's you do cloud contributes competitive actually that? activities market and as offering. branding for as services on And aggressive recurring. appreciate the really And that something classify an demand for to as want us

Yeah.

well. business. I think legacy you of the It's what different payroll it all than did we with did no

years, about. exercises platform, us the such So we've over of future branding rewriting Noemie that that, exercise to last that actual allows the us the the cloud gives marketing tax it true been also a customer's but get growth, and number in and into talking foothold system, the actually a it Dayforce the becomes that component is hence

the actual business Dayforce gross the tax as tech up things the into margins were significantly movement the on kind improve the gross profit, the stack profit as of recurring quite though we gross to on did A few able we well.

now the entire basis And we are within points of recurring on see so Dayforce gross few margins platform. the tax what on the a

the We also to some services. did make some of changes

For We longer like do printing. example no that things directly.

ways deliver of types that of we So outside kind Ceridian. of low-margin the worked to out services, customers other to

That's helpful. you. very Thank

Michael. Thanks,

of Our next from Ader Jackson MoffettNathanson. comes

for taking questions, Great. our Thanks guys.

the on a how I think parse can much increase year-over-year. you size of I'm whether deal is curious, one XX% up that's first The

customers but of being steady more maybe employees the to actually like attributable was that larger uptake more versus product. holding customers having employees

business. vectors five for got we've the growth Look,

first that we is The customers. one new acquire

we the is that go we back and increase We base upsell actual second them. platform. the The to

inside the the were think XXXX that with out As to we fiscal of sales base. XX% Leagh I did pointed back

growth And from done effectively. the go the and we've vector And into very the of is see that that you then as obviously list large space. can and third the such, we enterprise enterprise customers

as of same So modules looking the the selling sell it's the we're time growth by area more really the organizations. large kind at And effectively looking at time into a growing at all and rectangle.

you quantifiable XXXX quick just on for can in the then or expectation on follow-up XXXX. wallet margins that wallet. impact revenue in the in either the for impact on talk And $XXX that a or Any right. about expected million All Okay.

you again, to Obviously have million, $XX million, X-X. mumbling I when speak. Not $XXX stop

now. it Got Yes. that. about Sorry

Yes.

of the actually goes obviously up as business of the up as terms the margins margins, In well. go the scale

year-over-year. And the it XXX% I improve. rest that growing we as that would an at over for kind think think profitability Dayforce I expect time. a the in growth probability, again, line today, of the of it’s business application. look overall trend small business will continue But well to some I obviously But it's if of with

Okay. Thank you. Got it.

Research. next Zukin Our Alex from comes Wolfe question of

you me Can okay? guys. hear Hey

Hey, you. to Alex. speak with Nice

Likewise.

XXX if million migration, million the of account and conservative think basis $XXX you is else? -- the recurring it kidding. for the actually a just guide about wallet Is the Dayforce more bit I guidance than the more it, -- historical does no, on taking volatile if little that revenue. appear tax Dayforce deliver methodology Dayforce points do $XX of something exclude excluding the for guess, it just in I'm revenue, So, Wallet recurring you your macro,

were business this dollar getting one what on-prem David the in And into just to cloud? it And how you moving the service? to over or that much cloud Dayforce? from piece for a a one boost Bureau help we that convert that for tax well now understand, for charging is Are is us also migrate migration left as

Yes.

no the recurring that tech significant both First Dayforce Dayforce of order investments revenue the of in We going all in to and Alex, we company and revenue as module different put if trying you do for engineering make tax. remember Dayforce a us off the a different like the Wallet we recurring of and against and components get building in of kind the that. to case into it. in resources development get and It's the

So, order hold, two and product Dayforce that. on growth those because obviously recurring line, as to the technology in saying P&T specific frame I I the think don't invested the get what we you're from in modules would

of yes, tax cost the year. you're that been over be revenue on from prices to but in that's a that get infrastructure able there's were the to the that of last I the also improved In those have terms mentioned we had Dayforce. savings side, we pricing, correct, And there's too. getting when increase we a Obviously, look the with margins that line for

exists of to latent just for that base Bureau next that convert in to of still the tax over course in opportunity then in years And the terms either Bureau? the Dayforce or over few

kind did it able No, we're way a that of in it do to all-in. we

migration. XXX So, actually growth QX, particular the that basis points about it's for from at lift you look if

million and XXXX look And like so for across effectively makeup the North this year. moves the to the is the I $X if towards of American year, over payroll to fiscal all is Dayforce Tax million. run Bureau kind $X.X remaining

We've $X got still level. Freedom million probably that around the holds product small business that

business of We million. that. HRO to $X that goes neighborhood inside Bureau allocation more still have million little a float of no towards $X the business There's of bit the in

look then will at have of the years. And products APJ I we the And the that number we total it million. about over next that migrating it's $XX-or-so if be year for probably in

Maybe one incremental by for into better in for the sneaking a adding getting helpful. business. contribution super last as David. generally just just at about private be How inorganic you -- look thought one seems -- the That's the process market functionality to valuations you bit little around as think

on the recurring doing at looking XXXX. M&A not scale quite hitting a on gross significant billion XX% honestly focused organically. adjusted EBITDA of We're $X and revenue We're margin XX% within the any

you guys Congrats. so Thank Perfect. much.

And Raimo Lenschow the Barclays. we'll our last question take from night with of

thank Can you Hey hear you. okay? me

you. to Hey Raimo, good with speak

and dated Are the stuff you talk out are here. it in people of old Yes. seeing legacy can where from create offering Can a any bit -- perfect. really any Same in that a customers where what Are where there getting like of cloud strong, wins trend really, moving. impressive see the there? other terms these terms vendors not tried kind very enterprise things is having coming here? Okay, like of the some of you are that little you there is are patterns are

market, some the We're ERPs expect changed. bureau companies but that's some We're you in right replacing replacing also of cloud the obviously think replacing of that that you always obviously that know of some don't the branders Board. legacy of. the would across we've We're had. payroll the It's I

global compliance. are number are And payroll. capabilities number management, one We're global workforce be differentiated payroll. Gartner HCM our we number Look I only whether We're it we one vendor But set. that completely HR, for quadrant. global on customer leadership differentiated look it for one that when at in we're think specifically in pure-play the for global I also we

large quite the I comes a shared at all we're market operations companies. as of to I the is Leagh you the to and scale of the very of So, inside post-COVID enterprise world. the about of think would spoke just do add the globalization that? companies And to services reality unique it when beginning move what

efficiency. I think that the is driver only consolidation would thing and is the add I

in to of over be companies wins replacement give common as So referred win is many a the fuel in efficiency of to we're order you really Australia course to replacing example. an I that in different XX like last This of David The systems. growth. quarter, both multiple I'll to the drive look systems. and trend a our as able

that's that driver. key say And really so a I would

Yes.

changing Okay. more Perfect. system are client future get you integrators you, your you Have follow-up thinking well. on there when almost say, well. about and stream? is congrats the coming thinking as started that more as you for about actually one then starting me around like quick the recognition integrators revenue that? customer help are you in the And the and as vendors as day live. Any and Thank usually Other system client changed Are you using because from how evolve from one it?

of color, model that's say imagine a can Yes. business a I that add moving I'll you mean towards. I'll ask little but we're simply bit Noemie

transformation proposition. that we we course integrators we sell the would the We will system software. over few in joint years model. the And with implementation. you with you sell do what Noemie of partner should services. we that value to that continue Together come next As a the expect add? They mature the

as have additional a and and includes we're SaaS than that more bit but It's -- a easier modules with well the Yes, it do and Obviously, and other some in the kept in obviously you full suite payroll. and signing years strides sell We're when that ACM big started We've a upon opportunities couple a of you’ve actually right covered direction. time contract. the model Leagh. ago offering you that moving that no, also customers starts to attendance have that and customers doing payroll making

Okay. Perfect. Thank you.

everyone Thanks joining for call. Raimo. Thanks, the