The Roseland, New Jersey-based company said net income for the third quarter was $226.5 million, or 36 cents a share, compared to $193.4 million, or 31 cents in the year-ago period, beating the expectation of 35 cents a share, according to analysts surveyed by First Call.
"Revenue growth will slow from current rates beginning in our fourth quarter as a result of reaching the anniversary date of the Audatex acquisition and the dispositions of our Peachtree Software business in March and our Electronic Banking business in April," ADP CEO Arthur Weinbach said in a statement. "We believe margins will continue to strengthen in the remainder of the year and EPS growth will be about 15 percent in the fourth quarter."
The current First Call consensus estimate for ADP's fourth quarter is 30 cents a share.
For the third quarter, the company said revenue increased 13 percent, up to about $1.5 billion compared to $1.3 billion in the year-ago period.
The company said revenue in its employer services business rose 17 percent, which was backed by strong new business sales and internal revenue growth.
In addition, the company saw a 66-percent revenue growth in its claims division, which was fueled by its acquisition last May of Audatex, a provider of automotive claims services in Europe.
In afternoon trading, shares of ADP slipped 0.25 to 40.5.