Mike Infante

Tim reaffirmed balanced allocation (investment-grade rating, organic investment, dividend, M&A, buyback residual) but signaled heavier buybacks with shares seen as compelling value at 1.9x leverage.

Asked by Michael Infante on for James Faucette. Tim said tokenized positions use existing rate schedules (registered for native, beneficial for custodial, pass-through-like for synthetic) and add complexity that drives position growth.

Tim said gating factor is capacity to engage partners, not demand. Expanding team to meet demand. Companies in pipeline tend to be digital asset ecosystem firms. For non-crypto corporates, depends on capital raising economics and investor demand. Speculated large upcoming IPOs could include tokenized sleeves as market catalyst.

Ashima quantified sales guidance delta at $40-45M at midpoint, translating to only 10-30bps revenue impact given conversion cycles. Positive drivers for FY27 include volume trends, existing $430M backlog, growth-accretive M&A, and internal growth. Will provide formal FY27 guidance in August.

Tim framed it as revenue positions being the core metric with fractional shares and small managed accounts growing on top. Spread will fluctuate. Ashima added 11% revenue position growth still above long-term mid to high single-digit trend, with additional positions akin to backlog converting later.

Tim acknowledged H2 ramp needed but said origination up 20%+ is positive indicator. Closed largest-ever DLR sale to tier-one global bank last week. Deep pipeline mix of on-track and possible closings supports $290-330M guidance. Met with dozen+ client CEOs recently.

Ashima explained revenue raise driven by iJoin and Signal acquisitions offsetting rate cuts, plus underlying business strength. Tim said early in year, reinvesting in tokenization, digital assets, shareholder engagement, AI and platform. Staying with EPS guidance is the right call.

Tim said expect GAAP volatility from Canton Coins which will be adjusted out. Plan to liquidate holdings over time but Canton Coins could become more valuable as network grows. Ashima added ~1 point impact to capital markets revenue, not significant at Broadridge scale.

Tim said DLR not moving total sales needle but very material for the product. $200B daily volume larger than entire crypto market ex-Tether. Signed 8 new clients in FY25 including Tier 1s. Sponsored repo for treasury clearing driving adoption.

Tim acknowledged year-long elongation trend but said nothing incrementally worse now. Emphasized sales coming from areas of investment: voting choice, wealth platform, DLR repo, global post-trade. More strategic conversations than ever before.

Ashima broke down 15% total vs. 11% revenue position growth. Also noted only 75-80% of regulatory revenue is directly tied to position growth, with international proxy and other comms growing slower.

Tim explained license model typically from acquired companies. Well advanced in transition but a tail remains. Q3 wealth license renewal shifted to Q4, creating quarterly noise.

Ron said it's about speed and cost, they've done ~40,000 transactions on the JPM private blockchain, and could move half of SWIFT wires onto such rails by year-end.

Peter said nothing specific to flag. Volatility across the world created opportunity to display capabilities and gain business. Pointed to upcoming cross-border teach-in describing a $160 trillion market with only 1% market share.

Ron reported 3-4 signed contracts at $5M run rate, 50 accounts in pipeline. Most interesting finding: FIs most interested in multicurrency bank account product even more than payment capabilities. Slower sales cycle than end businesses but formula is working. Still bullish on contribution.

Ron reiterated rails are insignificant cost. Getting 50-60 bps on trades (sometimes 100 depending on customer) mostly because of liquidity and compliance, not rails. Does not see compression as high risk. Compared stablecoin hype to EV -- more written and said than actually used.

Bob said Paychex has not seen PEO downselling and has not assumed further retention gains, having baked in only the trends seen so far.

Management addressed Bill.com partnership go-to-market and PEO mix dynamics.

Follow-up on Bill.com partnership go-to-market and PEO mix dynamics.

Gibson noted existing embedded/white-label capabilities especially in CPA micro area. Open to broader partnerships where mutual value exists. More to come.

Maria said they are monitoring the regulatory environment closely and preparing for all possibilities on payment rails. Strategic imperative to support however client employees want to get paid.