Oct 29, 2026 earnings call — Payroll tax distribution expansion and recurring growth
Asure reported third quarter revenue of $40 million, a 10% year-over-year increase.
Revenue $0.0B (est $0.0B) · EPS $0.21 (est $0.19) · Next-quarter revenue outlook $0.0B–$0.0B
Key quotes
"During the third quarter, we meaningfully expanded the distribution of our Payroll Tax Management solution, which already represents nearly 20% of Asure's revenue."
"Asure Central brings single sign-ons, user provisioning, role-based access together with payroll, tax, HR, recruiting, time and attendance, 401(k), benefits and Luna, all in one environment and resellers can white label the experience with their own logo."
"We grew revenue 10% to $40 million and adjusted EBITDA grew 29% to $10.5 million with adjusted EBITDA margin expanding approximately 400 basis points to 26%."
Analyst Q&A 6
revenue per employee and reseller purchase
Q (Jeff Van Rhee · Craig-Hallum): He asked the current per-employee-per-month revenue and how it could evolve. He also asked what the Southeastern reseller purchase brings and its revenue, plus a quick bridge to 2027 free cash flow.
A: Management said the full-suite potential is over $100-plus per employee per month and could be as much as $180 with added products. They reported payroll revenue per unit was up 57% this past quarter. The acquired reseller was about a $10 million run rate when bought, with a couple of million expected this quarter, and they expect the 2027 guide implies midteens growth and about $8 million of interest costs leading to roughly $14 million free cash flow next year under their assumptions.
"We published the art of the possible, which is $100-plus per employee per month as specific number." — Patrick Goepel (CEO·CHAIR)
cost savings and Q4 EBITDA drivers
Q (Richard Baldry · ROTH Capital): He asked what drove flat costs despite revenue growth — integration, AI, or scale — and how far AI savings can go. He also asked what explains the Q4 adjusted EBITDA range and its variables.
A: Management said they are in the early innings: scale is already helping and they are starting to implement AI across ops, finance, and sales. For Q4 they expect some headwinds from sales hiring and integration of the acquisition, even though recurring revenue is growing versus nonrecurring by a little over $2 million in Q4. They view the guide as conservative and said midpoint implies about 10% year-on-year growth next quarter with organic growth driving much of next year.
"If you look at the mix in the guide, recurring revenue is growing over nonrecurring revenue to the tune of a little over $2 million in the fourth quarter." — Patrick Goepel (CEO·CHAIR)
SMB demand and float interest benefit
Q (Jared Levine · TD Cowen): He asked about SMB HCM demand, pipeline, and any macro effects on sales cycles and volume. He also asked how to think about float revenue after the recent 25 basis point hike and over the next four quarters.
A: Management said pipeline is strong and multiproduct demand is increasing as small businesses want fewer vendors and help with compliance, 401(k) needs, and access to capital and people. On float, they said roughly $0.5 million a year of benefit per quarter point with current balances, and Goldman expects another 0.25 point in December and 0.25 in March, which could be about $1 million upside if that happens; their current guide assumes only the hike already announced.
"I think from my perspective, it's worth for us roughly $0.5 million a year every quarter point right now with our current balances." — John Pence (CFO)
gross margin outlook and drivers
Q (Eric Martinuzzi · Lake Street): He asked if Q3 gross margin was an outlier or if longer-term gross margins have improved and why.
A: They said GAAP gross margin is about 70% this year and they expect roughly 72% GAAP next year, with non-GAAP near 75% this year and about 76%–77% next year. The improvement is from scale: people ramping with better tools and higher average revenue per customer as more products are attached.
"I would say next year, I think we're shooting for about 72% GAAP and about 76%, 77% non-GAAP." — John Pence (CFO)
enterprise payroll tax demand and marketplaces
Q (Colby Sanford · Stephens): He asked what enterprise buyers and ERP partners said at recent conferences and how Oracle/AWS marketplace listings will generate leads. He also asked about PEO moves by competitors and any impact on new-logo deals.
A: Management said feedback from the conferences was very positive and lead volumes are up, and their embedded payroll, tax filing, and treasury foundation is resonating with enterprise and mid-market buyers. They expect strong growth in '27 and '28, believe they can build PEO capabilities if needed but prefer unbundled managed services, and are leaning into AI and software together.
"But you've already seen it, but in '27, '28, I think you're going to see strong growth in that area." — Patrick Goepel (CEO·CHAIR)
Oracle/AWS response and reseller deal details
Q (Gregory Gibas · Northland): He asked about early response to Oracle and AWS listings and whether those networks or events have created opportunities. He also asked for more detail on the acquired payroll processor's vertical capabilities and whether the purchase price met the 2x revenue target.
A: Management said it is early but initial returns are positive: lead flow was much higher at recent conferences and there is good buyer interest from their modernization work. For the acquired payroll processor, they said the purchase price was about 2.6x revenue, the staff and product fit are strong, and added scheduling and reporting capabilities will be leveraged going forward.
"I think purchase price was about 2.6x revenue." — Patrick Goepel (CEO·CHAIR)