HR software provider Paycom (NYSE: PAYC) reported Q2 CY2026 results topping the market’s revenue expectations, with sales up 9.8% year on year to $531.2 million. The company’s full-year revenue guidance of $2.20 billion at the midpoint came in 0.7% above analysts’ estimates. Its non-GAAP profit of $2.78 per share was 16.8% above analysts’ consensus estimates.
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Paycom (PAYC) Q2 CY2026 Highlights:
- Revenue: $531.2 million vs analyst estimates of $513.1 million (9.8% year-on-year growth, 3.5% beat)
- Adjusted EPS: $2.78 vs analyst estimates of $2.38 (16.8% beat)
- Adjusted EBITDA: $235 million vs analyst estimates of $213.4 million (44.2% margin, 10.1% beat)
- The company slightly lifted its revenue guidance for the full year to $2.20 billion at the midpoint from $2.19 billion
- EBITDA guidance for the full year is $1.01 billion at the midpoint, above analyst estimates of $959.9 million
- Operating Margin: 31.7%, up from 23.2% in the same quarter last year
- Free Cash Flow Margin: 35.8%, up from 32% in the previous quarter
- Billings: $530 million at quarter end, up 9.4% year on year
- Market Capitalization: $8.17 billion
Company Overview
Pioneering the concept of employees doing their own payroll with its "Beti" technology, Paycom (NYSE: PAYC) provides cloud-based human capital management software that helps businesses manage the entire employment lifecycle from recruitment to retirement.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Thankfully, Paycom’s 18.1% annualized revenue growth over the last five years was decent. Its growth was slightly above the average software company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within software, a half-decade historical view may miss recent innovations or disruptive industry trends. Paycom’s recent performance shows its demand has slowed as its annualized revenue growth of 9.7% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. 
This quarter, Paycom reported year-on-year revenue growth of 9.8%, and its $531.2 million of revenue exceeded Wall Street’s estimates by 3.5%.
Looking ahead, sell-side analysts expect revenue to grow 6.1% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and implies its products and services will face some demand challenges.
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Billings
Billings is a non-GAAP metric that is often called “cash revenue” because it shows how much money the company has collected from customers in a certain period. This is different from revenue, which must be recognized in pieces over the length of a contract.
Paycom’s billings came in at $530 million in Q2, and over the last four quarters, its growth was underwhelming as it averaged 9% year-on-year increases. This performance mirrored its total sales and suggests that increasing competition is causing challenges in acquiring/retaining customers. 
Customer Acquisition Efficiency
The customer acquisition cost (CAC) payback period measures the months a company needs to recoup the money spent on acquiring a new customer. This metric helps assess how quickly a business can break even on its sales and marketing investments.
Paycom is extremely efficient at acquiring new customers, and its CAC payback period checked in at 13.8 months this quarter. The company’s rapid recovery of its customer acquisition costs means it can attempt to spur growth by increasing its sales and marketing investments. 
Key Takeaways from Paycom’s Q2 Results
We were impressed by Paycom’s optimistic full-year EBITDA guidance, which blew past analysts’ expectations. We were also glad its billings outperformed Wall Street’s estimates. Zooming out, we think this quarter featured some important positives. The stock traded up 7.2% to $187.50 immediately following the results.
Paycom had an encouraging quarter, but one earnings result doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).
