(Reuters) – Dayforce raised its full-year revenue forecast on Wednesday, banking on robust demand for its payroll and human capital management services, sending its shares up 8% in premarket trading.
Strong client spending on the company’s flagship Dayforce platform that provides services such as cloud-based human resource management, recruiting and payroll processing boosted its second-quarter recurring revenue 20% to $321.6 million.
Heavy investment in artificial intelligence has also helped the company compete with larger players such as Workday and Automatic Data Processing.
“Our strong results are translating into improved cash flow generation, prompting our Board of Directors to approve a $500 million share repurchase program,” CFO Jeremy Johnson said.
Dayforce expects fiscal 2024 revenue between $1.74 billion and $1.75 billion, above its prior view of $1.73 billion to $1.74 billion.
However, its third-quarter topline forecast of $425 million to $430 million was below analysts’ average estimate of $430.7 million, according to LSEG data.
Its second-quarter revenue rose 15.7% to $423.3 million from a year ago, exceeding expectations of $417.5 million.
But the company reported a net loss of 1 cent per share, compared with a net income of 2 cents a year ago.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Shreya Biswas)
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