Adam Ante: Yes. I mean the program hasn’t been paused in that – it’s not still processing and the IRS still is processing. I mean, we had expectations to receive a little bit of ERC-related revenues. And I think it’s going to come in close to our expectations. I mean, we’re anticipating something around 1 point of our revenue for the whole year related to ERC, and I think it’s going to be relatively consistent to that.
Raul Villar: And Q1 was on track.
Adam Ante: Q1 was on track, yes.
Matt Pfau: Perfect. Thank you. Appreciate it.
Operator: Thank you. Our next question is from Kevin McVeigh with UBS. Please go ahead.
Kevin McVeigh: Thank you so much. I wonder can you give us a sense of how much pricing overall contributed to 2023 revenue? And how should we think about that in terms of what’s embedded ‘24?
Adam Ante: Yes. Kevin, you are little soft there. I think the question was around price, how much did pricing impact FY ‘23? Yes. I mean, normally – and the way that we sort of think about it is how much of our PEPM growth comes from pricing actions and about third of it tends to come from pricing. And so that could be 2 to 3 points or so depending on the overall growth. And then we have some specific programs and some new services that we released also in Q3 of last year that we talked about that added up to that 15% PEPM growth was a little bit more outsized there with some new services that were primarily around year-end fee services. So traditionally or typically we would see about third of that growth related to some sort of pricing.
Kevin McVeigh: And then if you think about, Adam, the realization versus kind of the book on the PEPM. You see that narrowing kind of, because I think you quoted $17 or something like that realization versus $51 at kind of book, if you would. Any thoughts as to the convergence there?
Adam Ante: Yes, I think it’s going to take some time for it to converge all the way to the top end. I mean, I think the fact is, is we’re growing our product suite faster than our ability to drive 100% penetration and attach. And so it’s going to take some time. I mean you’re growing the suite out and expanding really the bundle pricing model, which helps us at the point of sale on new business, which is part of what’s helping drive up the continued PEPM growth. And then you had to go back and drive the cross-sell motion into the base. And that just takes a little bit longer. So – and then the team has been great at being able to add new solutions and products to the suite at an outsized rate relative to the rest of the competitive set and the other solutions in the market. So I don’t think it’s going to converge in any near-term. And I think it’s going to be steady over time.
Operator: Thank you. Our next question is from the line of Robert Simmons with D.A. Davidson. Please go ahead.
Robert Simmons: Hey, thanks for taking the question. So your guidance looks like it implies recurring revenue accelerate something like 2 points in the second half of the year from first half. I guess, how much is that from those ramping partnerships in the embedded solution? And how much are other factors? Why would first half is slower than second half?
Adam Ante: Yes. I mean it was really – as we were adding some of these partnerships last year and coming into the year we really talked about – and there was a couple of dynamics that led to a lower Q4, Q1 number and going into the back half of what is now FY ‘24. And yes, some of that’s going to be the enterprise. Some of that is going to be the partnerships. And then there is also a little bit of continued same-store sales that we’re not going to have the same headwind going into the back half of the year as well. So most of it is just the visibility to what we’re going to see here coming up in January and starting in our fiscal Q3, which is the January quarter and giving us the confidence to the full year, which has been consistent with how we thought about it the last couple of quarters now.
Robert Simmons: Got it. And then last year, your seasonality was a little bit skewed 3Q, 4Q. Should we expect that to normalize this year, which would kind of suggest maybe a lower 3Q growth rate or higher 4Q growth rate or what should we think?
Adam Ante: Yes. I think you’re going to see 3Q normalizes a little bit. There was a little bit of trade with ERC between 3Q and 4Q. And that’s really not going to be as much of a factor as – I think we will continue to see 3Q normalize over time just as the year-end fees become a smaller and smaller portion of our portfolio.
Robert Simmons: Thank you.
Operator: Thank you. As there are no further questions, I would now hand the conference over to Raul Villar Jr. for his closing comments.
Raul Villar: Thank you again for joining us tonight. We are encouraged by the underlying fundamentals of the business and remain focused on executing our strategy. We look forward to connecting with you at several upcoming events, including the TD Cowen HCM Summit. Have a great night, everyone.
Operator: Thank you. The conference of Paycor has now concluded. Thank you for your participation. You may now disconnect your lines.
