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ADPAutomatic Data Processing

Industrials · Data Processing · Nasdaq
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The 10-K against last year's

92 changes: 11 added, 11 removed, 69 reworded, 1 quiet changes

10-K Aug 5, 2026 vs Aug 6, 2025
Risk FactorsRedline ↓
17.1%
of the text changed · 7,070 words now
18.2%
of the text changed · 7,847 words now
Legal ProceedingsRedline ↓
23.4%
of the text changed · 371 words now
Accounting PoliciesRedline ↓
5.1%
of the text changed · 4,685 words now

10-K 0000008670-26-000030 (2026-08-05) vs 10-K 0000008670-25-000037 (2025-08-06)

The redline

The paragraph that changed most in each section

Marked against last year's 10-K: cut words struck through, new words highlighted and underlined.

Risk Factors 251 words changed in this paragraph; it is 42% similar to last year's version.
We have programs and processes in place designed to prevent, detect and respond to data or cybersecurity incidents. However, as a result of the complexity of our operating environment, the period over which hardware and software has been acquired or other reasons, our programs and processes may not be sufficient or adequate or may fail to prevent, detect or respond to a cybersecurity incident or identify and/or remediate a security vulnerability in our operating environment. The techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, frequently and are increasingly more complex, sophisticated and effective (including due to the use of AI). As AI technologies, including generative and agentic AI, continue to evolve, threat actors are increasingly leveraging these technologies to enhance the sophistication, scale, speed and effectiveness of cyberattacks making them more difficult to detect and defend against. The adoption and deployment of AI technologies within our and our authorized third parties’ solutions, services, and systems may also introduce novel security, data governance and operational risks. In addition, new computing technologies, including quantum computing, new discoveries in the field of cryptography or other developments could result in a compromise or breach of the algorithms we or our authorized third parties use or have used to encrypt and protect data. We may fail to anticipate or detect these techniques and/or incidents for long periods of time and, even when we do so, we may be unable or fail to implement adequate or timely preventive or responsive measures. Our ability to address data or cybersecurity incidents may also depend on the timing and nature of assistance that may be provided from relevant governmental or law enforcement agencies. Hardware, software, applications or services that we develop or procure from authorized third parties, or are required by governmental or law enforcement agencies to install on our systems, may contain defects in design or manufacture or other problems that could (or in respect of third party software, may be designed to) compromise the confidentiality, integrity or availability of data or our

Source: Item 1A, 10-K 0000008670-26-000030 vs Item 1A, 10-K 0000008670-25-000037

MD&A 211 words changed in this paragraph; it is 60% similar to last year's version.
Years Ended % Change June 30, 2026 2025 2024 As Reported Net earnings $ 4,413.5 $ 4,079.7 $ 3,752.0 9% 8% Adjustments: Provision for income taxes 1,316.8 1,230.4 1,120.3 All other interest expense (a) 141.0 114.8 71.4 All other interest income (a) (92.9) (94.2) (97.0) Optimization initiatives (b) (4.5) 19.4 Business alignment program (c) 91.1 — Gain on sale of assets — (2.6) Net (gain)/loss on ADP Ventures' investments (d) (8.4) — Transformation initiatives (b) 0.1 5.4 Legal settlements (c) (e) 18.0 (0.4) (4.0) Optimization initiatives (d) 19.3 42.0 Adjusted EBIT $ 5,874.6 $ 5,347.1 $ 4,890.1 9% 10% Adjusted EBIT Margin 26.8 % 26.0 % 25.5 % Provision for income taxes $ 1,316.8 $ 1,230.4 $ 1,120.3 10% 7% Adjustments: Optimization initiatives (f) (1.2) 4.8 Business alignment program (f) 23.2 — Gain on sale of assets (e) (f) — (0.6) Net (gain)/loss on ADP Ventures' investments (f) (2.1) — Transformation initiatives (e) — 1.3 Legal settlements (e) (f) 4.4 (0.1) (0.9) Optimization initiatives (e) 4.8 10.5 Adjusted provision for income taxes $ 1,341.1 $ 1,234.5 $ 1,131.2 9% Adjusted effective tax rate (f) (g) 23.0 % 23.2 % 23.0 % Net earnings $ 4,413.5 $ 4,079.7 $ 3,752.0 9% 8% Adjustments: Optimization initiatives (b) (4.5) 19.4 Income tax provision for/(benefit from) optimization initiatives (f) 1.2 (4.8) Gain on sale of assets — (2.6) — Income tax provision on for gain on sale of assets (e) (f) — 0.6 Business alignment program (c) 91.1 — Transformation initiatives (b) 0.1 5.4 Income tax benefit for transformation initiatives (e) from business alignment program (f) (23.2) — (1.3) Legal settlements (c) (0.4) (4.0) Net (gain)/loss on ADP Ventures' investments (d) (8.4) — Income tax provision for net (gain)/loss on ADP Ventures' investments (f) 2.1 — Legal settlements (e) 18.0 (0.4) Income tax (benefit from)/provision for legal settlements (e) (f) (4.4) 0.1 0.9 Optimization initiatives (d) 19.3 42.0 Income tax benefit for optimization initiatives (e) (4.8) (10.5) Adjusted net earnings $ 4,485.4 $ 4,092.0 $ 3,784.5 8% 10% Diluted EPS $ 10.94 $ 9.98 $ 9.10 10% Adjustments: Transformation Optimization initiatives (b) (e) (f) (0.01) 0.03 Business alignment program (c) (f) 0.17 — 0.01 Net (gain)/loss on ADP Ventures' investments (d) (f) (0.02) — Legal settlements (c) (e) (f) 0.04 — (0.01) Optimization initiatives (d) (e) 0.03 0.08 Adjusted diluted EPS $ 11.12 $ 10.01 $ 9.18 9% 11%

Source: Item 7, 10-K 0000008670-26-000030 vs Item 7, 10-K 0000008670-25-000037

Accounting Policies 117 words changed in this paragraph; it is 35% similar to last year's version.
ASU 2023-09 Income Taxes (Topic 740): 2025-06 Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to Income Tax Disclosures the Accounting for This update enhances modernizes the transparency accounting guidance for internal-use software costs and decision usefulness requires capitalization of income tax disclosures software costs to better assess how an entity’s operations begin when (1) management has authorized and related tax risks, tax planning committed to funding the software project and operational opportunities affect its tax rate (2) it is probable that the project will be completed and prospects for future cash flows. June 30, 2026 the software will be used to perform the function intended. July 1, 2028 The Company is assessing this guidance. The adoption will modify disclosures but will guidance and has not have an yet determined the impact of ASU 2025-06 on the Company's its consolidated results of operations, financial condition, or cash flows.

Source: Item 8, Note 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0000008670-26-000030 vs Item 8, Note 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0000008670-25-000037

Legal Proceedings 94 words changed in this paragraph; it is 56% similar to last year's version.
In May 2020, a putative class action complaint was filed against ADP, TotalSource and related defendants in the U.S. District Court, District of New Jersey. The complaint asserts violations of the Employee Retirement Income Security Act of 1974 (“ERISA”) in connection with the ADP TotalSource Retirement Savings Plan’s fiduciary administrative and investment decision-making. The complaint seeks statutory Company reached a settlement of all outstanding claims for $48 million, subject to the court's approval. Accordingly, as of June 30, 2026, the Company recorded a $48 million accrual within accrued expenses and other unspecified monetary damages, injunctive relief and attorney’s fees. The current liabilities on the Consolidated Balance Sheet. Additionally, the Company is unable to estimate any reasonably possible loss, or range recorded insurance receivables of loss, with respect to this matter. The Company is vigorously defending against this lawsuit. $30 million within accounts receivable on the Consolidated Balance Sheet, which represents recoveries considered probable from purchased insurance.

Source: Item 3, via Note 13 – COMMITMENTS AND CONTINGENCIES, 10-K 0000008670-26-000030 vs Item 3, via Note 13 – COMMITMENTS AND CONTINGENCIES, 10-K 0000008670-25-000037

Every change, by type

Sentences and paragraphs added, removed or reworded

Sentences and paragraphs of ADP's Risk Factors and MD&A, 10-K 2026-08-05 against 10-K 2025-08-06. Each links to the text at sec.gov.

AddedRisk Factors
For our PEO to sponsor many of its employee benefit plan offerings, it must qualify as the employer of the WSEs under certain provisions of the Internal Revenue Code and ERISA. Additionally, our PEO’s status as an employer for purposes of ERISA is important because ERISA preempts certain state laws that could limit our PEO’s ability to offer certain benefit plan offerings as we do today. The definition of employer under the Internal Revenue Code and ERISA is not uniform and there is no definitive judicial or legislative interpretation of employer in the context of PEOs. Because many of our PEO employee benefit plan offerings are subject to ERISA, our PEO must administer and operate these plans in accordance with ERISA requirements. We believe that our PEO benefit plans satisfy all applicable ERISA requirements, but if it were determined that the PEO benefit

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedRisk Factors
plans fail to satisfy any such requirements, our PEO would likely be required to modify its current business model, and the PEO could be subject to material fines or penalties. Any such event could have an adverse impact on our financial results and liquidity.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedRisk Factors
The collection, storage, hosting, transfer, processing, disclosure, use, security and retention and destruction of personal information required to provide our services is subject to federal, state and foreign privacy, data protection and cyber security laws. These laws, which are not uniform, generally do one or more of the following: regulate the collection, storage, hosting,

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedRisk Factors
In addition, laws and regulations covering marketing, advertising, and email, telephone and text messaging communications, including the Telephone Consumer Protection Act, are applicable to our business. Claims that we have violated such laws or regulations could expose us to costly litigation, and if successful, significant statutory damages or other liabilities that could adversely affect our reputation, business, financial condition or results of operations.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedRisk Factors
of confidential or proprietary information which could limit our ability to protect, or prevent us from protecting, our intellectual property rights.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedRisk Factors
Our payroll and tax processing services involve the collection, custody and transmission of a significant volume of funds in short-time frames. Our operations and the systems on which we rely have been, and may in the future be, subject to processing, technological, fraud-related or human errors, as well as failures, delays or disruptions, despite our efforts to design and implement effective processing systems, controls and procedures. The inability to properly perform our money movement services, operational errors in the performance of these services (including as a result of human or system errors, timing mismatches, settlement failures, unauthorized transactions or failures or delays attributable to financial institutions or other third parties), or our failure to recover any funds from clients could result in significant financial losses, regulatory intervention, fines and penalties, litigation and reputational harm, which could have a material adverse effect on our business, financial condition and results of operations.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedMD&A
During fiscal 2026, we made meaningful progress on our Strategic Priorities. We continued to leverage our data advantages, domain expertise, and trusted brand to lead the HCM industry's AI transformation. ADP Assist became increasingly embedded in our clients' workflows, delivering meaningful time savings and improved accuracy. Since launching ADP Assist agents in January, we steadily expanded their availability across our payroll, benefits, HR, and compliance solutions, making AI-powered HCM agents accessible to nearly all of our more than 1.1 million clients. We also launched a dedicated space within ADP Marketplace for our partners' AI agents, further expanding our AI ecosystem. Additionally, we continued deploying AI tools across our sales, service, and research and development functions to improve the client experience and drive internal productivity gains. During the year, we experienced strong enterprise sales momentum for ADP Lyric HCM and the ADP WorkForce Suite, as our unified global payroll, global HR, and global time solutions continued to resonate with clients. Finally, we remained focused on delivering value through our global scale by providing compliant HCM solutions, local expertise, and trusted relationships wherever our clients operate.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedMD&A
ANALYSIS OF REPORTABLE SEGMENTSRevenues Years Ended % Change June 30, 2026 2025 As Reported Organic Constant Currency Employer Services $ 14,831.4 $ 13,883.1 7% 5% PEO Services 7,128.1 6,690.4 7% 7% Intercompany eliminations (12.1) (12.6) n/m n/m $ 21,947.4 $ 20,560.9 7% 6%

Read it in 10-K 2026-08-05 at sec.gov ↗

Show the other 3
AddedMD&A
(d) Represents (gains)/losses on investments made through our Corporate Venture Capital arm, ADP Ventures. (Gains)/losses on these investments may result from observable price changes, changes in ownership interest, accrued interest income, and impairment charges. These adjustments may be highly variable, are predominantly non-cash, are outside our control, and are not fundamental to the underlying operations of our business model.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedMD&A
(e) In fiscal 2026, this represents a net charge (establishment of a legal reserve and insurance recovery) from a legal matter settled during the year ended June 30, 2026. Refer to Note 13, Commitments and Contingencies, within the Notes to the Consolidated Financial Statements for further discussion. In fiscal 2025, this represents a reversal of a legal reserve recorded during the year ended June 30, 2023.

Read it in 10-K 2026-08-05 at sec.gov ↗

AddedMD&A
assumptions including projected revenue growth rates and profitability projections are dependent on our ability to upgrade, enhance, and expand our technology and services to meet client needs and preferences.

Read it in 10-K 2026-08-05 at sec.gov ↗

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