Asure forecasts $183M-$187M 2027 revenue while expanding Payroll Tax Management via AWS and Oracle

• “Our third quarter revenues came in at $40 million, representing a growth of 10% compared to the third quarter of 2025.” (Chairman & CEO Patrick Goepel)

• “Our organic growth rate for third quarter 2026 was 9% compared with 4% in the third quarter 2025… and up 5% in second quarter 2026.” (Chairman & CEO Goepel)

• “Organic recurring revenue growth for the third quarter was 14%, which is a continued acceleration driven by the launch of Asure Central a year ago and continued Payroll Tax Management momentum.” (Chairman & CEO Goepel)

• “During the third quarter, we meaningfully expanded the distribution of our Payroll Tax Management solution, which already represents nearly 20% of Asure's revenue.” (Chairman & CEO Goepel) “In August, we announced a co-selling arrangement… on the AWS Marketplace… co-sell into its 330,000 customers,” and “in September, we also made Payroll Tax Management available on Oracle Marketplace integrated with Oracle Fusion Cloud Human Capital Management.” (Chairman & CEO Goepel)

• “In the Payroll Tax Management business, we have already won approximately 30 major enterprise accounts for payroll tax management.” (Chairman & CEO Goepel)

• “In September… we launched Asure Central to our reseller network and took our first resellers live on the platform, which we believe will unlock significant cross-sell.” (Chairman & CEO Goepel)

• “On the sales front, we made significant progress in hiring reps. We're confident in hitting our target of 150 by year-end.” (Chairman & CEO Goepel)

• “After quarter end in October, we acquired a human capital management payroll processing company based in the Southeastern United States for an aggregate purchase price of $26.5 million.” (Chairman & CEO Goepel)

• “Third quarter total revenues were $40 million… Recurring revenue… was $36.9 million… Recurring revenue represented approximately 92% of total revenue.” (CFO John Pence)

Outlook

• “We anticipate revenue of $42 million to $44 million and adjusted EBITDA of $10 million to $12 million for Q4 2026.” (CFO Pence)

• “This implies full year 2026 guidance of $162 million to $164 million in revenue and adjusted EBITDA of $40 million to $42 million.” (CFO Pence)

• “Our preliminary guidance for 2027, we anticipate revenue to be in the range of $183 million to $187 million and adjusted EBITDA margin to be in the range of 26% to 28%.” (CFO Pence)

• Compared with the prior quarter’s call, management moved from providing Q3 and full-year 2026 ranges to adding preliminary 2027 guidance and stating the updated outlook “incorporates the recent acquisition we completed in October of 2026.” (CFO Pence)

Financial Results

• “Gross profit for Q3 2026 was $27.8 million… GAAP gross margin… was 70%… Non-GAAP gross margin… was 75%.” (CFO Pence)

• “Net loss for Q3 2026 was $0.6 million… EBITDA… was $7.9 million… Adjusted EBITDA… was $10.5 million… Adjusted EBITDA margin… was 26%.” (CFO Pence)

• “We ended the third quarter with cash and cash equivalents of $16.8 million and total debt of $64.7 million.” (CFO Pence)

• “On October 15, we closed a new senior credit facility of up to $115 million… led by MUFG Bank Ltd.” (CFO Pence) “We used $62.6 million of the gross proceeds to repay in full our existing credit agreement with MidCap Financial Trust.” (CFO Pence)

• On the October acquisition economics, management said the “aggregate purchase price was $26.5 million,” with “$13.5 million in cash,” a “promissory note… $3 million,” and “the issuance of shares valued at $10 million.” (CFO Pence)

Q&A

• Jeff Van Rhee, Craig-Hallum: asked about per-employee-per-month potential and suite value; Chairman & CEO Goepel: answered, “We published the art of the possible, which is $100-plus per employee per month… if you add brokerage… as much as $180,” and added, “revenue per unit in the payroll business was somewhere up 57%.”

• Jeff Van Rhee, Craig-Hallum: asked what Asure is “getting” in the Southeastern acquisition; Chairman & CEO Goepel: said, “They had some kind of unique front ends… help us advance the whole business on some verticals,” and called it “a pretty attractive acquisition.”

• Jeff Van Rhee, Craig-Hallum: asked organic growth embedded in Q4/2027 and acquisition revenue contribution; CFO Pence: said the acquired business “was probably at about around $10 million run rate… expect a couple of million in this quarter,” and that the 2027 midpoint “implies kind of 13%, 14%,” with “majority… organic.”

• Jeff Van Rhee, Craig-Hallum: asked for a free-cash-flow bridge; CFO Pence: said, “we're expecting probably around $8 million of interest costs for the year,” and described an approach of “adjusted EBITDA less the cost of finance,” adding, “we'll probably be in about the $14 million range next year on that.”

• Richard Baldry, ROTH: asked why costs were “very flat” while revenue rose and how much is AI; CFO Pence: said, “what you're seeing right now is the pre-AI scale part of the business… early, early stages of us getting AI benefits.” Chairman & CEO Goepel: added, “we still have a lot of AI opportunity to take cost out and improve all the way around.”

• Richard Baldry, ROTH: pressed on Q4 adjusted EBITDA range and variables; CFO Pence cited hiring headcount catch-up and “a little bit of integration work,” while Chairman & CEO Goepel pointed to “continued spend in the sales and marketing area,” “some ramp costs in sales for '27,” and “spending some money” on integration and workflows.

• Jared Levine, TD Cowen: asked about SMB HCM demand and macro; Chairman & CEO Goepel: said, “Pipeline is really good… Pipeline has gone up,” and highlighted compliance and SECURE 2.0-related 401(k) demand: “we see that as a big demand focus.”

• Jared Levine, TD Cowen: asked about float revenue sensitivity; CFO Pence: said, “it's worth for us roughly $0.5 million a year every quarter point,” and noted Goldman’s view of “another 0.25 point coming in December… and… March,” while adding, “we have not overestimated the float.”

• Eric Martinuzzi, Lake Street: asked whether gross margin step-up is sustainable; CFO Pence: said, “we're probably in the 70% range for the year,” and for 2027, “shooting for about 72% GAAP and about 76%, 77% non-GAAP.”

• Colby Sanford, Stephens: asked how AWS/Oracle marketplace announcements translate to leads; Chairman & CEO Goepel: said feedback was “really positive,” adding, “we're prepared for this moment,” and, “in '27, '28, I think you're going to see strong growth in that area.”

• Colby Sanford, Stephens: asked about a competitor leaning into PEO and competitive landscape; Chairman & CEO Goepel: responded, “AsureWorks… is not a PEO model,” and, “we think there's market share opportunity to go after,” while positioning “AI and software, not one or the other.”

• Gregory Gibas, Northland: asked early response from Oracle/AWS ecosystems; Chairman & CEO Goepel: said, “it's so early days,” but also, “our lead volume was probably triple last year,” and described “a lot of excitement.”

• Gregory Gibas, Northland: asked about acquired company vertical capabilities and valuation; Chairman & CEO Goepel: said, “purchase price was about 2.6x revenue,” and pointed to “scheduling capability and kind of time opportunity… in addition to some of the reporting.”

Sentiment Analysis

• Analyst tone was slightly positive, frequently affirming results while probing sustainability and drivers, including “Congrats on a nice posting here” (Jeff Van Rhee, Craig-Hallum) and pointed cost/guide questions such as “can you talk about the pieces of that sort of cost savings?” (Richard Baldry, ROTH).

• Management tone was positive and expansion-focused in prepared remarks and remained confident in Q&A, using language such as “We're really starting to hit our stride” (Chairman & CEO Patrick Goepel) and “we're prepared for this moment” (Chairman & CEO Goepel), while acknowledging timing uncertainty with “it's so early days” (Chairman & CEO Goepel).

• Versus the previous quarter, management added more concrete forward framing (preliminary 2027 guidance and post-quarter acquisition/financing detail) and repeated a similar confidence pattern around scale/AI, with continuity in “early innings” language on AI adoption and benefits (CFO John Pence in both quarters).

Quarter-over-Quarter Comparison

• The current call added a completed acquisition and a new senior credit facility, whereas the prior call discussed M&A intent without a deal close and stated “there's nothing included in the guidance right now on the back half” for acquisitions. (CFO Pence, Q2; CFO Pence and Chairman & CEO Goepel, Q3)

• Distribution strategy sharpened in Q3 with marketplace-led expansion: “AWS Marketplace” and “Oracle Marketplace” launches for Payroll Tax Management (Chairman & CEO Patrick Goepel), compared with Q2 emphasis on enterprise payroll tax milestones like “2 million of their supported employees are now live” for Vensure. (Chairman & CEO Goepel, Q2)

• Sales-force messaging stayed consistent around the “target of 150” reps (Chairman & CEO Goepel), but Q3 leaned more into near-term ramp and integration costs affecting Q4 profitability range. (Chairman & CEO Goepel; CFO Pence)

• Analyst focus shifted from Q2’s heavier emphasis on AI monetization and double-digit organic growth math to Q3’s deeper drilling on acquisition contribution, margin durability, and float-rate sensitivity, while continuing to test cost leverage drivers. (Multiple analysts)

Risks and Concerns

• Management flagged execution spend and integration demands as near-term pressure points: “some ramp costs in sales for '27” and “a little bit of integration work too with the acquisition.” (Chairman & CEO Patrick Goepel; CFO John Pence)

• On revenue mix and quarterly variability, management emphasized recurring mix and noted prior-year professional services volatility, saying Q4 would have “a similar story… in terms of the mix of recurring and nonrecurring,” and that they are “not expecting that same volume of nonrecurring.” (CFO Pence)

• On marketplace distribution, management cautioned timing: “it's so early days.” (Chairman & CEO Goepel)

Final Takeaway

Management framed Q3 2026 as a quarter of accelerating organic recurring growth and improving profitability, while expanding distribution for Payroll Tax Management through AWS and Oracle marketplaces and taking Asure Central live with resellers to drive cross-sell. Leadership also emphasized the post-quarter acquisition in the Southeastern U.S. and a new $115 million credit facility as strategic capacity for growth, and paired those moves with updated Q4 2026 guidance and preliminary 2027 targets, while acknowledging near-term costs tied to sales hiring and acquisition integration.

Read the full Earnings Call Transcript

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