Dayforce Inc

Q2 total revenue was $465 million, up 10%; excluding float, total revenue was $415 million, up 12%. Dayforce recurring revenue excluding float was $315.5 million, up 14%, and professional services revenue was $71.6 million, up 23%. Operating profit was $42.3 million versus $14.1 million last year; adjusted EBITDA was $147.2 million, up 27%, with a 31.7% margin, up 420 basis points. Free cash flow was $87.1 million in the quarter, or 18.7% of revenue; year-to-date free cash flow was $106.6 million versus $53.9 million last year. For full-year 2025, management guided to total revenue of $1.935 billion to $1.955 billion, Dayforce recurring revenue excluding float of $1.324 billion to $1.344 billion, adjusted EBITDA margin of 32%, and free cash flow margin of 13.5% to 14%. For Q3, they guided to total revenue of $476 million to $486 million, Dayforce recurring revenue excluding float of $329 million to $339 million, and adjusted EBITDA margin of 30% to 30.5%.

David Ossip said Dayforce had a "great second quarter" and beat the high end of guidance across all metrics. He emphasized the company’s 12-to-1 system simplification story, its single data model, and its positioning as the "AI people platform" as the core reasons customers are buying more modules and broader suites. His tone was confident and expansive, repeatedly pointing to sales momentum, strong retention, and a long runway to deeper penetration across the existing customer base.

Jeremy Johnson highlighted that revenue and cash flow both scaled well: total revenue grew 10%, adjusted EBITDA margin reached 31.7%, and year-to-date free cash flow margin improved to 11.3% from 6.3%. He said the increase in full-year free cash flow margin guidance from 12% to 13.5% to 14% is largely driven by tax changes in the One Big Beautiful Bill Act, which should provide about a $40 million to $50 million cash tax benefit this year and about $20 million in 2026 and beyond. He also detailed pension-related cash charges of about $30 million in Q3 and about $5 million in Q4, while noting the noncash accounting impacts do not affect EBITDA or ongoing business performance.

Analysts focused on how strong bookings will convert into revenue, the role of systems integrators, the size and monetization of AI products, and the apparent disconnect between strong bookings and a softer sequential growth rate in Dayforce recurring revenue. Management said SI-led sales were up 80% in the first half, 45% of new sales in Q2 were SI-led, and add-ons and managed services are helping drive faster back-half revenue conversion. On AI pricing, Ossip said there is clear potential to charge more over time as more agents roll out, but he did not give specific pricing. On the Government of Canada and federal contract questions, management said Canada is on track with about half of a roughly USD 15 million deal already recognized and the rest to come through the back half of the year.