Paychex Inc (PAYX)
Pretax margin
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before tax but after interest (EBT) | US$ in thousands | 2,175,900 | 2,218,000 | 2,048,200 | 1,824,600 | 1,434,200 |
| Revenue | US$ in thousands | 5,571,700 | 5,278,300 | 5,007,100 | 4,611,700 | 4,056,800 |
| Pretax margin | 39.05% | 42.02% | 40.91% | 39.56% | 35.35% |
May 31, 2025 calculation
Pretax margin = EBT ÷ Revenue
= $2,175,900K ÷ $5,571,700K
= 39.05%
The pretax margin of Paychex Inc. has shown a generally upward trend over the period from May 31, 2021, to May 31, 2024. Specifically, the margin increased from 35.35% in 2021 to 39.56% in 2022, reflecting an improvement in profitability before taxes. The upward trajectory continued into 2023, with the pretax margin reaching 40.91%, indicating a further enhancement in operational efficiency or profit generation relative to revenue. By May 31, 2024, the margin had increased to 42.02%, signifying a peak within this period and suggesting the company maintained effective cost control or superior revenue margins.
However, there was a slight decline observed in the subsequent year, with the pretax margin decreasing to 39.05% as of May 31, 2025. This dip could reflect various factors such as increased expenses, competitive pressures, or changes in revenue mix, although the margin remained relatively high compared to the levels in 2021.
Overall, Paychex Inc.'s pretax margin demonstrates a steady improvement over the observed years, peaking in 2024 before experiencing a modest contraction in the following year. The pattern indicates strong profitability trends, with the company likely benefiting from operational efficiencies and favorable revenue streams, albeit with some volatility observed towards the latest fiscal period.