How does Automatic Data Processing (ADP) make money?

Automatic Data Processing (ADP) generates revenue primarily from HCM, which accounted for 44.5% of total revenue in TTM through Q2 2026. The company reported $21.9B in revenue and converted 20.1% of it into net profit, equivalent to roughly $4.41B in net income — what's left after the cost of revenue, operating expenses, interest, and income taxes.

What is the gross profit margin of Automatic Data Processing (ADP)?

Automatic Data Processing (ADP) reported a gross profit margin of 48.2% in TTM through Q2 2026, equivalent to $10.6B in gross profit on $21.9B in revenue. Gross margin measures how much of each dollar of revenue remains after the direct cost of producing or delivering the product — a higher figure typically signals pricing power, scale, or a less capital-intensive business model.

What is the operating profit margin of Automatic Data Processing (ADP)?

Automatic Data Processing (ADP) reported an operating profit margin of 18.6% in TTM through Q2 2026, equivalent to $4.08B in operating income. Operating margin captures profitability after research & development, sales & marketing, and general & administrative expenses — but before interest, taxes, and one-off items — and is the cleanest single read on the underlying business's efficiency.

What is the net profit margin of Automatic Data Processing (ADP)?

Automatic Data Processing (ADP) reported a net profit margin of 20.1% in TTM through Q2 2026, equivalent to $4.41B in net income. Net margin is the bottom-line share of revenue that survives every expense — operating costs, interest, and income taxes — and is the figure that flows directly into earnings per share.

Is Automatic Data Processing (ADP) profitable?

Yes. Automatic Data Processing (ADP) reported $4.41B in net income for TTM through Q2 2026, with a net profit margin of 20.1%. The company earned more from its operations than it paid out in costs, interest, and income taxes, leaving positive earnings on the bottom line.

How much does Automatic Data Processing (ADP) invest in research and development?

Automatic Data Processing (ADP) invested $775M in research and development during TTM through Q2 2026, roughly 3.5% of total revenue. R&D spending funds the company's future product pipeline and is expensed in full on the income statement rather than capitalised, which makes the operating margin sensitive to how aggressively management chooses to reinvest in innovation.

How much does Automatic Data Processing (ADP) spend on capital expenditures?

Automatic Data Processing (ADP) spent $340M on capital expenditures (CapEx) during TTM through Q2 2026, roughly 1.5% of total revenue. CapEx represents long-lived investment in property, equipment, data centres, and other physical infrastructure, and is subtracted from operating cash flow to arrive at free cash flow.

How much free cash flow does Automatic Data Processing (ADP) generate?

Automatic Data Processing (ADP) generated $4.98B in free cash flow during TTM through Q2 2026, a free-cash-flow margin of 22.7%. Free cash flow is the cash left after capital expenditures and represents the discretionary pool the company can use to pay dividends, repurchase shares, repay debt, or fund acquisitions without raising external capital.

What is the effective tax rate of Automatic Data Processing (ADP)?

Automatic Data Processing (ADP) had an effective tax rate of 23% in TTM through Q2 2026. The effective rate is the actual share of pre-tax income paid as income taxes and can differ materially from the statutory rate due to foreign earnings mix, tax credits (such as R&D), share-based compensation deductions, and one-off discrete items.

What are the main business segments of Automatic Data Processing (ADP)?

Automatic Data Processing (ADP) reports revenue across 4 reportable product segments, led by HCM at 44.5% of total revenue in TTM through Q2 2026. See the revenue-by-segment table on this page for the full breakdown and how each segment feeds into the income-statement waterfall above.

How Automatic Data Processing Makes Money: 2026 Visual Revenue Map

Automatic Data Processing (ADP) Income Statement Flow — TTM through Q2 2026

Calculated from the four most recent reported quarters, ending June 30, 2026 (reported July 29, 2026).

Automatic Data Processing discloses geographic revenue only in annual filings. to view the full breakdown.

Automatic Data Processing (ADP) Revenue by Product Segment — TTM through Q2 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported segments changed mid-year.

Revenue contribution by product segment for Automatic Data Processing (ADP), TTM through Q2 2026.
Segment	Revenue (USD)	% of total
HCM	$9.76B	44.5%
Professional Employer Organization	$4.86B	22.1%
HRO	$4.27B	19.5%
Global	$3.05B	13.9%
Total	$21.9B	100%

HCM$9.76B
Professional Employer Organization$4.86B
HRO$4.27B
Global$3.05B
Total$21.9B

Revenue Breakdown — TTM through Q2 2026

In TTM through Q2 2026, Automatic Data Processing (ADP) reports revenue across 4 reportable product segments; the largest segment was HCM at 44.5%, followed by Professional Employer Organization (22.1%) and HRO (19.5%).

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