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First Quarter Highlights and Financial Results Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 1 Fiscal 2027
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 2 Forward Looking Statements Certain written statements in this presentation may contain, and members of management may from time to time make or discuss statements which constitute, "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, all matters that are not historical facts. Forward-looking statements are not assurances of future performance. Instead, they are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to known and unknown uncertainties, risks, changes in circumstances, and other factors that are difficult to predict, many of which are outside our control. Our actual performance and outcomes, including without limitation, our actual results and financial condition, may differ materially from those indicated in or suggested by the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. More information regarding these risks and uncertainties and other important factors that could cause actual results to differ materially from those indicated in or suggested by the forward-looking statements is set forth in the Company’s earnings release and filings with the Securities and Exchange Commission. The information provided in this presentation is based upon the facts and circumstances known as of the date of this presentation, and any forward-looking statements made by us in this document speak only as of the date on which they are made. Except as required by law, we undertake no obligation to update these forward-looking statements after the date of issuance of this presentation to reflect events or circumstances after such date, or to reflect the occurrence of unanticipated events.
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Paychex An industry-leading human capital management (“HCM”) company delivering a full suite of technology and advisory services in human resources, employee benefits, insurance and payroll. Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 3 Overview • Trusted HCM provider serving ~840,000 customers and paying 1 in 11 U.S. private-sector employees(1) • Leading provider of AI-enabled HR technology and advisory solutions powered by unrivaled data • Top HR outsourcer with ~2.6M worksite employees(1) • Large and growing $100B+ underserved market • Durable business model with strong cash generation and disciplined capital allocation (1) As of May 31, 2026
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First Quarter Highlights Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 4
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 5 First Quarter Highlights Sustained growth in revenue and earnings with strong operational performance o Delivered double-digit growth in PEO & Insurance revenue, operating income and diluted earnings per share o Continued strong demand for our advisory and benefits solutions across ASO, PEO and Retirement o Improved client retention year-over-year and continued to achieve record PEO worksite employee retention Advanced our strategic priorities o Progressed FY27 strategic priorities: data and AI leadership, go-to-market evolution, and advisory differentiation o Delivered tangible WISE AI outcomes, including preventing ~90% of the top targeted payroll errors o Announced WISE Hire in September, bringing agentic recruiting capabilities to SMBs o Advanced our go-to-market evolution by positioning Paychex as a strategic partner helping businesses succeed and by equipping sales and customer service teams to offer the full breadth of our technology and advisory solutions o Continued to strengthen our advisory differentiation, supporting strong growth across our HR outsourcing solutions Returned $424M to shareholders in quarterly dividends
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Adjusted Diluted EPS(1)Total Revenue Operating Income 6 First Quarter Financial Highlights $1,540M $1,630M Q1 FY26 Q1 FY27 $542M $619M Q1 FY26 Q1 FY27 $1.22 $1.34 Q1 FY26 Q1 FY27 Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 6% 14% 10% (1) Adjusted diluted earnings per share (“EPS”) is not a U.S. generally accepted accounting principles (“GAAP”) measure. Refer to slides 16 and 17 for a reconciliation to the corresponding GAAP measures.
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$1,163 $1,213 $329 $368 Q1 FY26 Q1 FY27 Management Solutions • Higher product penetration • Price realization and higher revenue per client 7 First Quarter Revenue Key Drivers PEO(1) & Insurance Solutions • Growth in the number of average PEO worksite employees • Increase in PEO insurance volumes (1) Professional Employer Organization (“PEO”) (In Millions) 6% Total Revenue +5% +12% +4% $50$48 $1,540 $1,630 Interest on Funds Held for Clients • Higher average investment rates Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary.
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WISE: A Highly Differentiated, AI-Powered Intelligence Engine Workforce Intelligence Strengthened by Expertise Designed to Enhance Productivity, Decision-making and Results 8 Built on Decades of HR Expertise and Trillions of Data Elements WISE Intelligence Aware of context • Proactive, context-aware intelligence • Anticipates issues and flags risks early • Enables smarter decisions in the flow of work WISE Assistants Advising in the moment • Dynamic, real-time guidance in workflows • Reduces friction and manual effort • Enables smarter, more efficient outcomes WISE Agents Acts to deliver outcomes • Autonomous workers embedded in workflows • Execute tasks with minimal intervention • Delivers scalable, trusted automation Supported by Expert Services and Managed Solutions Better experiences. Smarter decisions. Stronger outcomes. Embedded across Paychex Flex | Paycor | SurePayroll Enabled by Modern Infrastructure spanning Payroll | Tax | Payment Orchestration | HR | Benefits Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary.
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 9 Recent Awards and Recognition Paychex continues to be recognized for its innovative technology, market leadership, and corporate culture HR Tech Top HR Products (WISE) Paychex’s agentic AI engine, WISE, was named a 2026 Top HR Product of the Year by HR Executive, recognized for its innovation and impact on the HR technology industry Newsweek America’s Greatest Companies Paychex was named one of the Greatest Companies in America by Newsweek, with five-star ratings for its financial strength, innovation, commitment to its workforce, and sustainability efforts
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$3.77 $4.27 $4.72 $4.98 $5.51 FY22 FY23 FY24 FY25 FY26FY22 FY23 FY24 FY25 FY26 $5,278 $6,512 $4,612 $5,007 $5,572 Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 10 Sustained Financial Performance (In Millions, Except Per Share Amounts) (1) Adjusted diluted earnings per share (“EPS”) is not a U.S. generally accepted accounting principles (“GAAP”) measure. Refer to our Annual Report on Form 10-K for a discussion of this measure and a reconciliation to the corresponding GAAP measure. Total Revenue Adjusted Diluted EPS(1) * 5-Year CAGR
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Fiscal 2027 Outlook Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 11
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 12 Fiscal Year 2027 Outlook (1) Adjusted diluted EPS and adjusted operating margin are non-GAAP financial measures. Refer to our discussion of non-GAAP financial measures in our first quarter fiscal 2027 earnings press release. September 23, 2026 June 24, 2026 Year-over-Year Growth Year-over-Year Growth Management Solutions Revenue 5% - 6% 5% - 6% PEO & Insurance Solutions Revenue 7% - 8% 6% - 7% Total Revenue 5% - 6% 5% - 6% Adjusted Diluted EPS(1) 7% - 9% 7% - 9% Anticipated Result Anticipated Result Interest on Funds Held for Clients $200M - $210M $195M - $205M Adjusted Operating Margin (1) ~44% ~44% Effective Income Tax Rate ~24% ~24%
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Financial Results Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 13
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 14 Financial Results For the Three Months ended August 31, 2026 (1) Refer to a reconciliation of non-GAAP financial measures to the related GAAP financial measures on slides 16 and 17. Three Months Ended % Aug 31, 2026 Change Management Solutions 1,213.1$ 4% PEO and Insurance Solutions 367.6$ 12% Total Service Revenue 1,580.7$ 6% Interest on Funds Held for Clients 49.8$ 5% Total Revenue 1,630.5$ 6% Operating Income 619.2$ 14% Net Income 429.7$ 12% Diluted EPS 1.21$ 14% Non-GAAP Measures:(1) Adjusted Operating Income 684.7$ 9% Adjusted EBITDA 738.3$ 9% Adjusted Net Income 479.2$ 9% Adjusted Diluted EPS 1.34$ 10% (In millions, except per share amounts)
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Financial Highlights ($ in Millions) • Strong liquidity position with $1.0B in cash and corporate investments • Gross leverage ratio(2) of ~1.5x • Return on equity of 47% • Consistent free cash flow generation supports industry- leading dividend payout ratio Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 15 (1) Excludes operating lease liabilities of $85.8M and $74.2M as of August 31, 2026 and May 31, 2026, respectively. (2) Gross leverage ratio calculated as total debt divided by trailing-twelve-month adjusted EBITDA. Adjusted EBITDA is a non-GAAP financial measure. Refer to our discussion of non-GAAP financial measures in our first quarter fiscal 2027 earnings press release. (3) Free cash flow is a non-GAAP financial measure calculated as operating cash flow less purchases of property and equipment (which includes internally developed software costs). Purchases of property and equipment for the fiscal quarter ended August 31, 2027 and 2026 were $56.1M and $55.9M, respectively. (4) Dividend coverage ratio is calculated as free cash flow divided by dividends paid. (In millions) Aug 31, 2026 May 31, 2026 Cash, Restricted Cash, & Total Corporate Investments 989.2$ 1,177.3$ Total Debt, Net of Debt Issuance Costs(1) 4,558.0$ 4,556.1$ Gross Leverage Ratio(2) 1.5x 1.5x Return on Equity 47% 45% Fiscal Year-to-Date Period Ended: Aug 31, 2026 Aug 31, 2025 Operating Cash Flow 413.5$ 718.4$ Free Cash Flow(3) 357.4$ 662.5$ Dividends Paid 424.1$ 389.1$ Dividend Coverage Ratio(4) 0.8x 1.7x
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 16 Non-GAAP Financial Measures For the Three Months ended August 31, 2026 (1) Acquisition-related costs included in selling, general and administrative expenses include (I) $56.9 million for the first quarter compared to $61.1 million for the corresponding prior-year period, in amortization of intangibles acquired in the acquisition of Paycor HCM, Inc. ("Paycor"); (II) $8.5 million for the first quarter compared to $18.7 million for the corresponding prior-year period, in compensation costs related to the acquisition and integration of Paycor, including replacement awards, severance and retention bonuses; and (III) $0.1 million for the first quarter compared to $5.0 million for the corresponding prior-year period, in other acquisition-related costs primarily consisting of professional service fees. (2) Adjusted operating income, adjusted operating margin, and adjusted net income are non-GAAP financial measures. Refer to our first quarter fiscal 2027 earnings press release for further discussion. (3) Net tax windfall related to stock-based compensation payments recognized in income taxes. This item is subject to volatility and will vary based on option holder decisions related to exercising stock options and fluctuations in our stock price, neither of which is within the control of management. Aug 31, Aug 31, % 2026 2025 Change Operating Income 619.2$ 541.9$ 14% Non-GAAP Adjustments: Acquisition-related costs (1) 65.5 84.8 Adjusted Operating Income (2) 684.7$ 626.7$ 9% Adjusted Operating Margin (2) 42.0% 40.7% Net Income 429.7$ 383.8$ 12% Non-GAAP Adjustments: Acquisition-related costs (1) 65.5 84.8 Income tax benefit for acquisition-related costs (15.7) (20.6) Discrete tax shortfall/(windfall) related to employee stock-based compensation payments (3) (0.3) (7.2) Adjusted Net Income (2) 479.2$ 440.8$ 9% Three Months Ended
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 17 (1) The calculation of the impact of non-GAAP adjustments on diluted earnings per share is performed on each line independently. The table may not add down by +/- $0.01 due to rounding. (2) Acquisition-related costs included in selling, general and administrative expenses include (I) $56.9 million for the first quarter compared to $61.1 million for the corresponding prior-year period, in amortization of intangibles acquired in the acquisition of Paycor HCM, Inc. ("Paycor"); (II) $8.5 million for the first quarter compared to $18.7 million for the corresponding prior-year period, in compensation costs related to the acquisition and integration of Paycor, including replacement awards, severance and retention bonuses; and (III) $0.1 million for the first quarter compared to $5.0 million for the corresponding prior-year period, in other acquisition-related costs primarily consisting of professional service fees. (3) Net tax windfall related to stock-based compensation payments recognized in income taxes. This item is subject to volatility and will vary based on option holder decisions related to exercising stock options and fluctuations in our stock price, neither of which is within the control of management. (4) Adjusted diluted EPS, EBITDA, adjusted EBITDA, and adjusted EBITDA margin are non-GAAP financial measures. Refer to our first quarter fiscal 2027 earnings press release for further discussion. Non-GAAP Financial Measures For the Three Months ended August 31, 2026 Aug 31, Aug 31, % 2026 2025 Change Diluted EPS (1) 1.21$ 1.06$ 14% Non-GAAP Adjustments: Acquisition-related costs (2) 0.18 0.23 Income tax benefit for acquisition-related costs (0.04) (0.06) Discrete tax shortfall/(windfall) related to employee stock-based compensation payments (3) (0.00) (0.02) Adjusted Diluted EPS(4) 1.34$ 1.22$ 10% Net Income 429.7$ 383.8$ 12% Non-GAAP Adjustments: Interest expense 65.1 68.2 Interest income on corporate investments (10.2) (18.7) Income taxes 135.3 113.7 Depreciation and amortization expense 109.8 109.3 EBITDA(4) 729.7$ 656.3$ 11% Non-GAAP Adjustments: Acquisition-related costs (2) 8.6 23.7 Adjusted EBITDA(4) 738.3$ 680.0$ 9% Adjusted EBITDA Margin(4) 45.3% 44.2% Three Months Ended
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Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 18 Investment Portfolio Results % ($ in millions) 2026 2025 Change Average Investment Balances: Funds Held For Clients 5,401.6$ 5,400.0$ –% Corporate Cash Equivalents and Investments 1,240.9$ 1,776.9$ (30%) Total 6,642.5$ 7,176.9$ (7%) Average Rate of Return Earned: Funds Held For Clients 3.7% 3.5% Corporate Cash Equivalents and Investments 3.3% 4.2% Combined 3.6% 3.7% Realized Gains/(Losses), Net 0.0$ (0.0)$ End of Period: Aug 31, 2026 May 31, 2026 Unrealized Loss, Net 92.4$ 52.5$ Three Months Ended Aug 31,
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Thank you Copyright 2026, Paychex, Inc. All rights reserved. Confidential and proprietary. 19