Paychex paid $424.1 million in dividends, 118.7% of quarterly free cash flow
Fiscal 2027 first-quarter 10-Q: dividends paid exceeded the $413.5 million of cash operations brought in, and no shares were repurchased in the same quarter
aiSwingX™ Editorial · Reviewed
Published
Paychex, Inc. Form 10-Q (fiscal 2027 first quarter, filed 2026-09-24, accession 0000723531-26-000006): consolidated statements of income, consolidated balance sheets, consolidated statements of cash flows, the receivables and allowance for credit losses note, the revenue note, the fair value note, and the Liquidity and Capital Resources discussion in MD&A. Quarterly figures cross-checked against SEC XBRL Company Facts.
aiSwingX™ analyzes US filings and reports them as news investors can read.
Paychex (PAYX) generated $413.5 million of operating cash flow in the first quarter of fiscal 2027. Subtracting $56.1 million of capital expenditure leaves free cash flow of $357.4 million. Dividends paid in the same quarter were $424.1 million — 118.7% of that free cash flow, and $10.6 million more than operating cash flow itself. Share repurchases were zero.
In plain terms
Paychex runs payroll for other companies. This quarter it handed shareholders more in dividends than the business brought in as cash. The money in its account fell by nearly half, and it did not buy back any of its own shares.
What happened
Paychex (PAYX) runs payroll, payments and human resources administration for other companies in the United States. Its fiscal 2027 first quarter ended on August 31, 2026, and the 10-Q was filed on September 24, 2026.
Four cash lines for the quarter. All appear in the consolidated statement of cash flows.
Item
Q1 FY2027
Operating cash flow
$413.5 million
Capital expenditure
−$56.1 million
Free cash flow
$357.4 million
Dividends paid
−$424.1 million
Dividends / free cash flow
118.7%
Dividends of $424.1 million exceed operating cash flow of $413.5 million by $10.6 million. Share repurchases in the same quarter were zero. A year earlier they were $160.1 million.
Cash fell by ●●Subscribers
Total assets fell by more than ●● because of client fundsSubscribers
●● of the ●● in revenue is interest on client fundsSubscribers
Interest expense of ●● against investment income of ●●Subscribers
The allowance for credit losses is ●●, up ●● in a yearSubscribers
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FAQ
How is the 118.7% of free cash flow figure derived?
It places the quarter's operating cash flow less capital expenditure beside the dividends actually paid. All three figures appear in this 10-Q's consolidated statement of cash flows.
Total assets fell by more than $500 million — has the business deteriorated?
The main reason total assets fell is not the company's own money but a decline in the funds clients place with it to meet payroll. The subscriber section separates the two amounts.
Does revenue include interest income?
Revenue includes, as a separate line, interest earned on investing the funds held for clients. The amount and its share are in the subscriber section.
How much did the allowance for credit losses rise?
The company discloses the allowance balance at both this date and the same date a year earlier. Both figures and the rate of increase are in the subscriber section.
Where can I verify this directly?
Open Paychex, Inc.'s fiscal 2027 first-quarter Form 10-Q (accession 0000723531-26-000006) on SEC EDGAR and read the consolidated statement of cash flows, the balance sheets, the receivables note and the liquidity discussion.
How aiSwingX™ wrote this
We read the filing on SEC EDGAR in full — statements, notes, MD&A. Press releases and news are not used as sources.
Every figure is reconciled to its location in the filing and to XBRL data. One mismatch means no publication.
An editor reviews before publication; any later change is recorded in the revision history.
Paychex, Inc. Form 10-Q (fiscal 2027 first quarter, filed 2026-09-24, accession 0000723531-26-000006): consolidated statements of income, consolidated balance sheets, consolidated statements of cash flows, the receivables and allowance for credit losses note, the revenue note, the fair value note, and the Liquidity and Capital Resources discussion in MD&A. Quarterly figures cross-checked against SEC XBRL Company Facts. · SEC EDGAR · This article is not investment advice. Disclaimer
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aiSwingX™ analyzes US filings and reports them as news investors can read.
