Payroll processor Paycom Software on Tuesday forecast fourth-quarter revenue that was below market estimates hit by sluggish demand for payroll solutions and human resource management amid an uncertain economy, sending the company’s shares down 28 per cent in extended trading.
Sticky inflation and high borrowing costs have clouded Paycom’s outlook and hurt demand for the company’s human resource and payroll services amid a resilient job market.
The results are in sharp contrast with rival Automatic Data Processing which last week topped profit estimates on higher demand for its payroll services.
Paycom forecast current-quarter revenue in the range of $420 million to $425 million, compared with estimates of $452.3 million, according to LSEG data.
The company also cut its annual revenue forecast to a range of $1.679 billion to $1.684 billion.
It posted revenue of $406.3 million for the third quarter ended Sept. 30, missing analyst estimates of $411.2 million.
Net income came in at $1.30 per share compared with 90 cents per share a year ago.