(Reuters) – Ceridian slightly raised its annual revenue forecast on Wednesday and surpassed quarterly sales estimates, thanks to strong demand for its human resources and payroll management services.
The results follow strong earnings at rivals such as Paycom and Automatic Data Processing, underscoring how a strong labor market is driving demand for payroll processors even as rising interest rates pressure the economy.
Ceridian, whose more than 6,000 customers include Spirit Aerosystems, said it now expects annual revenue of $1.49 billion to $1.51 billion, compared with its previous forecast of $1.48 billion to $1.50 billion.
Its revenue rose 21.5% to $365.9 million in the second quarter, beating estimates of $358.4 million, according to Refinitiv IBES data.
Much of that was driven by the success of its Dayforce platform, which allows businesses to manage payroll and view employee data.
The business brought in $268.2 million in recurring revenue in the quarter, and analysts have said that a relatively stable labor market should feed client expansion and stronger margins.
On an adjusted basis, the company earned 32 cents per share, compared with expectations for 29 cents.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Devika Syamnath)
