TriNet Group, Inc. (NYSE:TNET) Q1 2023 Earnings Call Transcript

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Kelly Tuminelli: Yeah. I’m happy to take that Burton. And Andrew thanks for the question. When we look at last quarter, CIE was negative overall. We are expecting positive hiring particularly as we look towards June and you get college grads going into the workforce and we see interns and seasonal workers coming on board. So we’re expecting positive CIE for the remainder of the year. But what we’re really expecting is significantly lower than what we saw last year, what we’ve seen historically. The low end of our range is about the lowest we’ve seen over a decade.

Andrew Nicholas: All right. Thank you very much.

Operator: The next question is from Jared Levine with TD Cowen. Please go ahead.

Jared Levine: Thank you. I wanted to dig in a little bit more on the PEO bookings. So, you previously cited January bookings growth of 35% year-over-year and now with 20% overall in 1Q. Was there a notable deceleration in March, or was it pretty even in terms of that I guess let’s call it softer back half of the quarter there?

Burton M. Goldfield: Yes, there wasn’t a notable deceleration. The fact is and this is an operational issue we changed territories and teams on February 1st. January is actually the last month of the sales year. So, as we reorganized and put the new teams in place February and March are usually relatively slower. So, there was no surprises there. But as I said to Tien-Tsin from my vantage point, we have a pipeline to continue that growth at least through Q2 as it looks right now.

Jared Levine: Okay, great. And then in terms of the sales force and your intentions to add headcount there, can you update us on the staffing levels of the sales force how that compared to also the beginning of the year? And then any change in terms of your hiring expectations over the year or even the timing of some of those headcount additions within the sales force?

Burton M. Goldfield: The goal right now is to end the year significantly higher in total rep count. That will be based on two things, which is both retention. Obviously, there’s a lot of momentum around the sales force and they won big in Q1. So, that certainly helps. And then the second is hiring of new reps. I would say by the end of the year; my expectation is roughly 20%-plus growth in sales headcount. But it is not on board yet. It will impact next year because I’d like to continue this momentum.

Jared Levine: Great. If I could sneak in one quick one here on Zenefits — revenue contribution? And are you still expecting around $50 million for the full year?

Kelly Tuminelli: For Zenefits?

Jared Levine: Yes.

Kelly Tuminelli: Yes, right around that level is our expectation.

Jared Levine: And the 1Q performance?

Kelly Tuminelli: And 1Q was right around $12 million.

Jared Levine: Great. Thank you.

Burton M. Goldfield: Thank you.

Operator: Ladies and gentlemen, this concludes our question-and-answer session and thus concludes today’s call. Thank you very much for joining TriNet’s first quarter 2023 earnings conference call. You may now disconnect. Take care.

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