Ceridian HCM Holding Inc. (NYSE:CDAY) Q3 2023 Earnings Call Transcript

Ceridian HCM Holding Inc. (NYSE:CDAY) Q3 2023 Earnings Call Transcript November 1, 2023

Ceridian HCM Holding Inc. beats earnings expectations. Reported EPS is $0.37, expectations were $0.29.

Matt Wells: Good morning and thank you for joining. Welcome to Ceridian’s Third Quarter 2023 Earnings Conference Call. I am Matt Wells, Head of Investor Relations. And on the call today, we have our Co-CEO, David Ossip; our CFO, Noemie Heuland; our Chief Product and Technology Officer, Joe Korngiebel; and our President of Customer and Revenue Operations, Steve Holdridge. [Operator Instructions] Now before I hand the call over to David, I want to remind everyone that our commentary may include forward-looking statements. These statements are subject to risks and uncertainties that could cause Ceridian’s results to differ materially from historical experience or present expectations. A description of some of these risks and uncertainties can be found in the reports we filed with the Securities and Exchange Commission such as the cautionary statements in our filings.

Pixabay/Public Domain

Additionally, over the course of this call, we’ll reference non-GAAP measures to describe our performance. Please review our earnings press release and filings with the SEC for our rationale behind the use of these non-GAAP measures and for a full reconciliation of these GAAP to non-GAAP metrics. These documents, in addition or a replay of this call will be available on the Ceridian Investor Relations website. And with that, David, I’d like to turn the call over to you.

David Ossip: Thank you and thank you all for joining us today. Today, I will discuss our strong third quarter results highlight our commitment to continually innovate on the Dayforce platform and provide an update on our raised full year outlook. Steve will provide more information on sales wins and successful customer implementations. Joe will highlight key announcements out of INSIGHTS, especially our gender of AI co-pilots autonomous payroll service desk delivery and other items that we discussed at our INSIGHTS conference. And Noemie will add detail to our quarterly performance and updated full year outlook. In the third quarter, I am pleased to report that we again exceeded guidance across all revenue and profitability metrics.

Dayforce recurring revenue grew by 35% year-over-year at constant currency and we are pushing the full beat and incrementally raising our revenue and profitability guidance for Q4 and for the full year. Before I go into the financial details, it’s with mixed emotions that I shared the news that Leagh will be leaving Ceridian on 10 November to become CEO of Cooper Software. If you recall, 5 years ago, I brought Leagh on board to bring structure and to build processes to scale and deliver durable growth. During our time together, we have delivered and the results speak for themselves. Our revenues have doubled and will surpass $1.5 billion by the end of this year. Our customer base has grown as well to over 6,300 live customers, including some of the biggest organizations in the world and adjusted cloud gross margins have expanded meaningfully from 67% to over 78% today.

And in terms of scale and structure, we now have an exceptional leadership team, including Steve and Joe, whom you will hear from today. I and this best-in-class team are committed to the continued success of our people, customers and business. Therefore, I’d like to express my gratitude to Leagh personally, although bitter sweet, I am delighted and proud of her development as a highly regarded leader in the cloud domain. She now has the chance to take the reins at Cooper and her appointment is truly well deserved. They are fortunate to have her at the helm. So, from all of us, Leagh, congratulations and thank you. Now, let’s turn to our financial results. In the third quarter, on a constant currency basis, Dayforce recurring revenue grew 35% and Dayforce recurring revenue ex-float grew 29% year-over-year at constant currency.

See also 12 Best Internet of Things (IoT) Stocks To Buy and Billionaire Paul Singer’s Top 10 Holdings and Recent Moves.

To continue reading the Q&A session, please click here.