Slide 1: Investor Presentation
J a Investor 101 Presentation PAYCHEX October 2023 HR | Payroll | Benefits | Insi
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain written and oral statements made by management may constitute “forward-looking statements” within the meaning of the safe-harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical fact
Slide 3: The Paychex Story
THE PAYCHEX STORY Paychex — A Technology-Driven Growth Company 1 2 3 4 Leader Innovative Predictable Sustainable in attractive technology leader and powerful growth and markets and trusted advisor business model delivering long- —a key differentiator term postive impact
Slide 4: Paychex At-A-Glance — Leader in Human Capital Management (HCM) Solutions
Paychex At-A-Glance — Leader in Human Capital Management (HCM) Solutions Market Leader Leading provider of HCM Solutions to SMBs with unique combination of HR Technology and tech-enabled Advisory Solutions Growing Client Base ~740,000 Payroll Clients ~2,200,000 HR Outsourcing client worksite employe
Slide 5: Leader in Small and Midsized Business Markets
| Leader in Small and Midsized Business Markets HR Outsourcing Payroll & HCM Software_ Retirement Insurance + #1 HR Outsourcer * Top 2 in both small and + #1 401(k) recordkeeper + Atop insurance mid-market? in the U.S.3 agency in the U.S. + 2.2MASO' and PEO . . worksite employees + $750B+ financial
Slide 6: Leader in Large and Growing HCM Market
Leader in Large and Growing HCM Market Market Size —- Employees’ (Total U.S.) ee $90B+ 134M Market Opportunity (U.S.) SMB? Segment 5-7% 1-1,000 Employees 69M Market Growth (U.S.) & 14% (Share of U.S. SMB employees) 4 Censusctta 2 ShiBie SmallorNicexe Qusece
Slide 7: Secular Tailwinds Play to Our Strengths
Secular Tailwinds Play to Our Strengths Market;Trends Paychex Advantage Technology Innovation and Adoption . oy a Leader in Shift to unified softw: it | . . j a ue, ee al innovative HC} Self-service and e- Lk solutions for WE iecterston otagialsdonon BY small and midsize | Analytics and reporting La
Slide 8: Well-Positioned in Fast Growing Market Segments
A CLOSER LOOK Well-Positioned in Fast Growing Market Segments HCM Technology HR Outsourcing Adoption of cloud HCM software by SMBs Secular increase in demand for assistance with navigating a complex HR automation/digitalization and distributed Market a eve uiroament workforces with increasing employ
Slide 9: What Differentiates Paychex
What Differentiates Paychex \ + i SaaS platforms and customer experiences HR advisory & compliance expertise Anaiyfieand) and Al capabilities nowered by » large data sets Mobile & self-service capabilities with insightful analytics \ey Personalized, tech-enabled services PAYCHEX °
Slide 10: The Paychex Story
THE PAYCHEX STORY Paychex — A Technology-Driven Growth Company 1 2 3 4 Leader Innovative Predictable Sustainable in attractive technology leader and powerful growth and markets and trusted advisor business model delivering long- —a key differentiator term postive impact
Slide 11: Comprehensive Suite of Leading HCM Solutions
Comprehensive Suite of Leading HCM Solutions Full Range of Integrated HCM Solutions from Hire to Retire for Businesses and Employees Integrated Technology Complete Solution Set for SMB Life Cycle (with Open APIs) O (a+) 28 Pal Life-Time Value Recruiting, Applicant HR Services Analytics Tracking, Onb
Slide 12: Leading Technology Provider Leveraging Industry Leading Partners and APIs
Leading Technology Provider Leveraging Industry Leading Partners and APIs M azure A O apporNamics AWS ARISTA — &8clover a Apache ~~" docker G EQUIFAX G Google HIRE,RIGHT™ 4 C3 Gndeed @ mongoDB Java kubernetes AJirav = aR arr sage splunk> stag @ Attametrics
Slide 13: Recognized as an Industry Innovation Leader
| Recognized as an Industry Innovation Leader FORTUNE FORTUNE ©] WORLD'S MOST ™ AMERICAS SJETHICAL MOST a COMPANIES* COMPANIES ETHISPHERE te Pee EG) fehTay XK [ sxandon Hat croup | Recent awards for MostAdmired, Most Ethical, and Most Innovative Companies 1st 4st 4st Real-Time Pooled Paycheck Paymen
Slide 14: Innovation Horizon
Innovation Horizon ore Customer Experience Focused Exmanded Advisory Owner | HR | Employee ervices Strategic Partners Tech-Enabled ach : Continued Leadership in D) IG IT, L HC LEADE Digitalization: Sales HR Technology and and Self-Onboarding Digital HR Solutions (eCommerce) Pe Artificial Intelligenc
Slide 15: Well Positioned to Capture the AI Opportunity
Well Positioned to Capture the AI Opportunity Large and Growing Data Sets Paychex has one of the largest SMB data sets in the industry — provides competitive advantage History and Experience LeveragingAl We have been leveraging Al for years across the entire business — ahead of the curve Investing t
Slide 16: The Paychex Story
THE PAYCHEX STORY Paychex — A Technology-Driven Growth Company 1 2 3 4 Leader Innovative Predictable Sustainable in attractive technology leader and powerful growth and markets and trusted advisor business model delivering long- —a key differentiator term postive impact
Slide 17: Predictable and Powerful Business Model
Predictable and Powerful Business Model Growing client base and A expanding product attachment with high retention Consistent revenue and earnings growth profile PAYCHEX HR | Payroll | Benefits | Insurance Disciplined and 4 shareholder friendly 3 Strong cash flow engine capital allocation
Slide 18: Consistent Revenue and Earnings Growth Profile
Consistent Revenue and Earnings Growth Profile Total Revenue $5.0B 8% CAGR I ail FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 Adjusted Diluted EPS* $4.27 I ml FY13 FY14 FY15 FY16 FY17FY18**FY19 FY20 FY21 FY22 FY23 Industry-Leading Operating Margins
Slide 19: Paychex Transformation — Technology and HR Solutions
Paychex Transformation — Technology and HR Solutions Management Solutions PEO & Insurance Solutions (FY23) (FY23) iY) 56 % 5% - 10% 15% = 20% FY23 Service Other Insurance Solutions Revenue in Non- @ Payroll Solutions 25% - 30% HR Solutions (ASO) +46% $3.7B () HR Outsourcing Organic WSE 5% - 10% Grow
Slide 20: Paychex Transformation: Technology Delivering Results for Customers and Shareholders
Paychex Transformation: Technology Delivering Results for Customers and Shareholders Increased Investments in ae: 13% Tech-enabled HCM revenue growth Technology & Digital 0 (5-year CAGR) CeTt/Am) % of clients use our technology Z\\\JAM Increase in mobile sessions (FY20-23 CAGR) mi th/AN % of sales d
Slide 21: Strong Cash Flow Engine
Strong Cash Flow Engine Strong Cash Flow Attractive Metrics $B ($B) (FY23) $1.5 Bree Gash Elav Free Cash Flow $1.5B Capital Intensity $1.0 $0.5 | $0.0 FY19 FY20 FY21 FY22 FY23 PAYCHEX *1
Slide 22: Disciplined and Shareholder-Friendly Capital Allocation
Disciplined and Shareholder-Friendly Capital Allocation Priorities Invest in Return Capital the Business to Shareholders + Technology Platform + Industry-leading dividend + PEO expansion + Digital and Advisory ver CE pee + Technology Tuck-ins Solutions . i “sales aerating Retmedover$582, atonal * Cu
Slide 23: Paychex Values in Action: ESG Efforts are Woven into the Company Strategies
Paychex Values in Action: ESG Efforts are Woven into the Company Strategies with Strong Results Environmental v Published ESG Report v DEI Efforts v Board refreshment, with focus on DEI on + Systemic approach (of last four new board members: two vy Announced ambition to reach Net Fi f Zero GHG by 20
Slide 24: The Paychex Story
THE PAYCHEX STORY Paychex — A Technology-Driven Growth Company 1 2 3 4 Leader Innovative Predictable Sustainable in attractive technology leader and powerful growth and markets and trusted advisor business model delivering long- —a key differentiator term postive impact
Slide 25: Long Growth Runway — Multiple Drivers
| Long Growth Runway — Multiple Drivers Grow Client Base and Market Share: Channels, Partners, eCommerce, Digital Marketing, and Acquisitions Expand Share of Wallet: HCM Software, HR, Retirement, Insurance, and Payments Leverage Technology Innovations: Al, personalization, data analytics, integratio
Slide 26: Mid-Term Financial Goals
Mid-Term Financial Goals Ho Total Revenue Growth Adjusted EPS Operating Dividend Growth Margins Growth . Upper Single- Upper Single- PP 9 F 4 Consistent with ee to Margin Expansion ° Digit _ Earnings Growth Double-Digit ee eee / PAYCHEX
Slide 27: The Paychex Story
THE PAYCHEX STORY Paychex — A Technology-Driven Growth Company 1 2 3 4 Leader Innovative Predictable Sustainable in attractive technology leader and powerful growth and markets and trusted advisor business model delivering long- —a key differentiator term postive impact