Dayforce Q3 Earnings Miss Estimates, Revenues Rise Y/Y, Shares Up

Dayforce DAY reported third-quarter 2025 earnings of 37 cents per share, which missed the Zacks Consensus Estimate by 33.93% and decreased 21.3% year over year.

Revenues of $481.6 million were in line with the Zacks Consensus Estimate and increased 9.5% year over year and 9.6% on a constant currency (cc) basis. Excluding float, total revenues were $439.4 million, reflecting an increase of 11.4% year over year and 11.6% on a cc basis.

In pre-market trading, shares rose 0.06%.

DAY’s Q3 Top-Line Details

Recurring revenues (83.7% of total revenues) increased 7.2% year over year to $403.1 million. Excluding float revenues, recurring revenues totaled $333.0 million, reflecting robust 14% year-over-year growth, or 14.1% at cc.

Dayforce, Inc. Price, Consensus and EPS Surprise

Dayforce, Inc. price-consensus-eps-surprise-chart | Dayforce, Inc. Quote

Dayforce achieved recurring revenue per customer of $175,172 in the trailing 12 months ended Sept. 30, 2025, reflecting an impressive year-over-year increase of 9.8%. As of Sept. 30, 2025, the number of live customers on the Dayforce platform reached 7,025, representing year-over-year growth of 4.4%.

Powerpay’s recurring revenues reached $19.7 million, reflecting a decrease of 2.5% year over year. 

Professional Services and Other (16.3% of total revenues) increased 22.5% year over year to $78.5 million.

DAY’s Operating Details

Selling and marketing expenses amounted to $86.8 million, up 1.2% year over year. General and Administrative expenses totaled $81.2 million, up 28.1% year over year.

Adjusted EBITDA was $147.3 million, up 16.8% year over year. Adjusted EBITDA margin was 30.6%, up 190 basis points (bps).

The adjusted operating profit amounted to $119.1 million, up 15.4% year over year. Operating margin expanded 130 bps on a year-over-year basis to 24.7%.

DAY Balance Sheet & Cash Flow

As of Sept. 30, 2025, cash and cash equivalents were $627.6 million compared with $625.2 million as of June 30, 2025.

In the third quarter of 2025, the company reported cash provided by operating activities of $31.2 million, down from $112.7 million in the prior quarter.

Free cash flow was $5 million compared with $87.1 million in the previous quarter.

DAY Zacks Rank & Stocks to Consider

Dayforce currently carries a Zacks Rank #3 (Hold).

BILL Holdings BILL, Advanced Energy AEIS, and Akami Technologies AKAM are some better-ranked stocks that investors can consider in the broader sector. Each stock carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Bill Holdings’ shares have declined 42% in the year-to-date period. BILL is set to report first-quarter fiscal 2026 results on Nov. 6.

Advanced Energy is set to report third-quarter 2025 results on Nov. 4. Advanced Energy shares have surged 79.9% year to date.

Akami Technologies is set to report third-quarter 2025 results on Nov. 6. Akami Technologies shares have plunged 23.7% year to date.

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This article originally published on Zacks Investment Research (zacks.com).

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