PCTYNEUTRAL

Gross Margin

72.3%

Higher than 64% of Technology sector peers

Updated 142h ago

Sector Performance

64th percentile

PCTY

72.3%

Sector Median

65.2%

Sector Avg

60.6%

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Deep Analysis

Paylocity's gross margin of 72.3% means that for every dollar of revenue, the company keeps roughly 72 cents after paying the direct costs of delivering its payroll and HR software.

This is higher than the sector median of 63.8%, placing PCTY in the 64th percentile among its Technology peers, indicating above-average cost efficiency relative to the industry. However, trend data is not available: there is no year-over-year or quarter-over-quarter change reported, and no historical values beyond the current figure, so it is impossible to assess whether margins are improving or deteriorating. The combination of a high single-point margin with no trend information means the metric offers limited insight into future risk or opportunity; an investor cannot tell if this level is stable, improving, or eroding. Because the overall verdict is NEUTRAL, this strong margin level supports maintaining that stance—it is a positive signal for profitability, but the lack of trend data prevents it from being a decisive factor for either a buy or sell recommendation.

Frequently Asked Questions

What does the Gross Margin tell investors about PCTY?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does PCTY's Gross Margin compare to its sector?

PCTY's Gross Margin of 72.3% compares to a Technology sector median of 65.2%, placing it in the 64th percentile.

Who are PCTY's closest peers by Gross Margin?

The closest Technology peers by Gross Margin include: LYFT (47.6%), COHU (46.3%), UBER (45.0%), LSPD (44.4%), GRAB (43.4%).

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.