Revenue during the quarter grew 24.41 percent to $68.65 million from $55.18 million in the previous year period. Gross margin for the quarter contracted 58 basis points over the previous year period to 55.74 percent. Operating margin for the quarter stood at negative 2.39 percent as compared to a negative 2.34 percent for the previous year period.

Operating loss for the quarter was $1.64 million, compared with an operating loss of $1.29 million in the previous year period.

However, the adjusted operating income for the quarter stood at $5.41 million compared to $3.97 million in the prior year period. At the same time, adjusted operating margin improved 69 basis points in the quarter to 7.88 percent from 7.19 percent in the last year period.

"I was pleased with our second quarter in terms of both top and bottom line performance given the challenge in comparing to the record-setting revenue growth in the second quarter of last fiscal year." said Steve Beauchamp, president and chief executive officer of Paylocity. "We continue to realize value from our product investments, as our newly released Recruiting product is off to a good start and we just launched our newest module, Expense Management. We continue to focus on investments in both our products and our people and were recently recognized as the #14 Best Places to Work in the Glassdoor Employees' Choice Award."

For the third-quarter 2017, Paylocity Holding Corporation expects revenue to be in the range of $87.50 million to $88.50 million. The company projects adjusted net income to be in the range of $12 million to $13 million. On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.22 to $0.24 for the third-quarter. 

For the fiscal year 2017, Paylocity Holding Corporation expects revenue to be in the range of $296 million to $298 million. The company projects adjusted net income to be in the range of $22.50 million to $23.50 million. The company projects diluted earnings per share to be in the range of $0.41 to $0.43 on adjusted basis.

Cash flow from investing activities was $130.83 million for the first half as against cash outgo of $302.74 million in the last year period.

The company has spent $150.46 million cash to carry out financing activities during the first six months as against cash inflow of $289.69 million in the last year period.

Cash and cash equivalents stood at $82.26 million as on Dec. 31, 2016, up 4.09 percent or $3.23 million from $79.02 million on Dec. 31, 2015.

Working capital increases
Paylocity Holding Corporation has recorded an increase in the working capital over the last year. It stood at $70.38 million as at Dec. 31, 2016, up 7.42 percent or $4.86 million from $65.52 million on Dec. 31, 2015. Current ratio was at 1.06 as on Dec. 31, 2016, down from 1.07 on Dec. 31, 2015.

Days sales outstanding were almost stable at 2 days for the quarter, when compared with the last year period.

At the same time, days payable outstanding went down to 8 days for the quarter from 9 for the same period last year.