What happened

Shares of Paycom Software (NYSE:PAYC) have popped today, up by 14% as of 1 p.m. EDT, after the company reported first-quarter earnings. The HR software specialist beat expectations for both the top and bottom lines but withdrew its 2020 guidance due to the COVID-19 pandemic.

So what

Revenue in the first quarter increased 21% to $242.2 million, easily topping the consensus estimate of $237.9 million. That all translated into adjusted net income of $77.9 million, or $1.33 per share. Analysts were looking for just $1.26 per share in adjusted profits. Adjusted EBITDA was $117.9 million, and Paycom finished the quarter with $181.8 million in cash and cash equivalents on the balance sheet.

Paycom logo

Image source: Paycom.

"I'm proud of our excellent first quarter results and the continued success we are having onboarding new clients," CEO Chad Richison said in a statement. "Our value proposition has never been stronger and we continue to see increased demand for the Paycom solution."

Now what

Paycom provides software for payroll and HR departments, and the business is taking a hit because it charges customers on a per-employee basis and many clients are laying off employees amid the COVID-19 crisis. The company has also transitioned 98% of its workforce to working remotely, and has halted all business-related travel.

Paycom withdrew its guidance for 2020 due to ongoing macroeconomic uncertainty, especially around unemployment. The company hopes to provide more information regarding outlook once it has more visibility, particularly once unemployment figures "become more predictable."