EPS of $0.07 increased by 147.7% from previous year
Gross margin of 76.7%
Net income of 7.60M
""One plus one is more than two. We’re getting more value from customers who use both BILL AP and Spend & Expense in tandem, which leads to stronger engagement and lower attrition."" - Rene Lacerte
Executive overview: Billcom reported Q4 2024 total revenue of $343.7 million, up 16% year over year (YoY) with core revenue of $301.0 million, also up 16% YoY. Non-GAAP operating income reached $60.0 million, up 42% YoY and representing a 17% margin, while non-GAAP net income was $64.0 million (3Q4 non-GAAP margin of 19%). The company maintained a strong gross margin profile on a non-GAAP basis of 85%, underscoring the leverage in its software and fintech platform. BILL standalone revenue was $161.0 million in Q4, up 8% YoY, while Spend and Expense revenue (formerly Divvy) rose 26% to $126.0 million, driven by card spend growth of 28% and 11,500 joint customers using both BILL AP and Spend & Expense by fiscal year-end 2024, up almost 60% YoY. The firm continued to build its integrated platform (AP, AR, Spend & Expense) and expanded into embedded FI and banking partnerships, including a strategic Xero collaboration positioned to beta in the US. BILL announced a new $300 million share repurchase authorization and a four-year extension of a key large FI partner contract, maintaining healthy liquidity with $1.6 billion in cash, cash equivalents and short-term investments. Guidance reflects a constructive growth path: Q1 2025 total revenue guidance of $346–351 million (13%–15% YoY) and full-year FY2025 revenue of $1.415–1.450 billion (10%–12% YoY), with float revenue around $145 million and non-GAAP net income per diluted share of $1.36–$1.61 for the year. Management signaled a longer-term ambition to drive core revenue growth of 20%+ in fiscal 2026, supported by investments of roughly $45 million in FY2025 and expanding monetization through ad valorem payments, embedded solutions, and supplier/merchant ecosystem expansion. Overall, BILL is transitioning from a stabilization phase to a growth-phase focused on platform expansion, cross-sell momentum, and a durable, value-driven SMB-centric financial operations platform.
Key Performance Indicators
Revenue
343.67M
QoQ: 6.39% | YoY:16.11%
Gross Profit
263.76M
76.75% margin
QoQ: 4.19% | YoY:8.35%
Operating Income
-21.83M
QoQ: 14.45% | YoY:47.27%
Net Income
7.60M
QoQ: -76.12% | YoY:147.85%
EPS
0.07
QoQ: -76.17% | YoY:147.67%
Revenue Trend
Margin Analysis
Key Insights
Q4 2024 total revenue: $343.7M, +16% YoY; core revenue (subscription and transaction fees) $301.0M, +16% YoY; float revenue $42.0M.
Earnings per share (Q4): diluted EPS $0.0715 GAAP; non-GAAP diluted EPS $0.0708? (Note: non-GAAP net income per diluted share guidance implies consolidated share count ~106–107M for Q4).
Operating mix and segment highlights
BILL standalone revenue: $161.0M, +8% YoY; FI channel net new customers: +6,700; direct/accounting channel net new customers: +4,600; standalone subscriber retention (ex-FI) 83%; ex-sunset retention would be 86%.
Financial Highlights
Revenue and profitability
- Q4 2024 total revenue: $343.7M, +16% YoY; core revenue (subscription and transaction fees) $301.0M, +16% YoY; float revenue $42.0M.
- Q4 non-GAAP operating income: $60.0M, +42% YoY; non-GAAP operating margin 17% (vs. - in absent float). Non-GAAP net income: $64.0M, margin 19%.
- Q4 GAAP gross margin: 26 3.8? (reported gross profit $263.8M on revenue $343.7M) = 76.7% GAAP gross margin; non-GAAP gross margin: 85%
- Earnings per share (Q4): diluted EPS $0.0715 GAAP; non-GAAP diluted EPS $0.0708? (Note: non-GAAP net income per diluted share guidance implies consolidated share count ~106–107M for Q4).
Operating mix and segment highlights
- BILL standalone revenue: $161.0M, +8% YoY; FI channel net new customers: +6,700; direct/accounting channel net new customers: +4,600; standalone subscriber retention (ex-FI) 83%; ex-sunset retention would be 86%.
- BILL Spend and Expense (formerly Divvy) revenue: $126.0M, +26% YoY; card spend growth: +28%; interchanges: 261 bps; rewards: 48% of Spend & Expense revenue.
- Joint customers using both BILL AP and Spend & Expense: 11,500, +60% YoY.
- Ad valorem monetization: ex-FI TPV ad valorem penetration as a company metric 14% in Q4, up from 13% a year ago; management views long-run potential above 20% for ad valorem across the ex-FI portfolio.
- Cash flow and liquidity: net cash provided by operating activities $78.6M; free cash flow $73.1M; cash and equivalents/short-term investments: $1.6B; net debt: -$170.2M (net cash).
- Shareholder capital allocation: repurchased $234M of 2025 convertible notes; total cash usage $222M; 0.4M reduction in weighted-average diluted shares; board authorized a new $300M share repurchase program.
Guidance and growth trajectory
- Q1 FY2025 guidance: total revenue $346–351M; core revenue $305–310M; float revenue ~$41M; non-GAAP operating income $52–57M; non-GAAP net income $53–57M; non-GAAP diluted EPS $0.48–$0.51 (assuming 111M diluted shares).
- FY2025 guidance: total revenue $1.415–1.450B; core revenue $1.270–1.305B; float revenue ~$145M; non-GAAP operating income $160–$195M; non-GAAP net income $154–$182M; non-GAAP diluted EPS $1.36–$1.61 (assuming 113M diluted shares).
- SBC guidance: stock-based compensation ~20% of total revenue in FY2025.
- Long-term target: core revenue growth of 20%+ in FY2026; investments (~$45M in FY2025) to accelerate growth; expectations of operating leverage as monetization improves and Spend and Expense scales.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
343.67M
16.11%
6.39%
Gross Profit
263.76M
8.35%
4.19%
Operating Income
-21.83M
47.27%
14.45%
Net Income
7.60M
147.85%
-76.12%
EPS
0.07
147.67%
-76.17%
Key Financial Ratios
currentRatio
1.55
grossProfitMargin
76.7%
operatingProfitMargin
-6.35%
netProfitMargin
2.21%
returnOnAssets
0.08%
returnOnEquity
0.18%
debtEquityRatio
0.24
operatingCashFlowPerShare
$0.74
freeCashFlowPerShare
$0.69
priceToBookRatio
1.36
priceEarningsRatio
184.76
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Key management insights and color from the earnings call:
- Strategy and market leadership: Rene Lacerte underscored a growth-on-offense stance: “we are all in for SMBs and we are all in to win the market that we created,” highlighting BILL’s aim to widen its category leadership through platform expansion, embedded finance, and ecosystem investments.
- Platform and product execution: Lacerte highlighted the integrated platform launch, data/analytics layer, and AI-driven experiences as core differentiators. He noted that BILL’s integrated platform now supports a consolidated view of cash flow and will continue to evolve with supplier engagement and broader payment options (e.g., local transfers, FedNow instant transfers, and invoice financing).
- Financial discipline and capital allocation: John Rettig emphasized the company’s capital discipline, including a $234M convertible note repurchase and a net debt position near zero, plus a new $300M share repurchase program. He also pointed to a turquoise of future investments and a path to margin expansion, including “ex-float profitability” progression and free cash flow generation.
- Embedded and ecosystem strategy: The team emphasized expanding embedded solutions with financial institutions and software partners (e.g., Xero) and deepening relationships with accountants, which account for over half of BILL’s customers. They cited large banks and regional banks adopting BILL’s white-label platform and APIs, showing momentum in the embedded finance segment.
- Supplier enablement and cross-sell dynamics: Management highlighted supplier onboarding improvements and early demand for invoice financing as a driver of ad valorem monetization and cross-sell opportunities, signaling a multi-year growth runway beyond standalone BILL AP/Spend & Expense.
- Near-term outlook and macro considerations: Executives noted stability in SMB activity and TPV per customer, with a cautious view toward sequential improvements in monetization as the macro environment normalizes and as new monetization levers come online in 2025–2026.
"One plus one is more than two. We’re getting more value from customers who use both BILL AP and Spend & Expense in tandem, which leads to stronger engagement and lower attrition."
— Rene Lacerte
"We are all in for SMBs and we are all in to win the market that we created. We are playing offense with a strong balance sheet to accelerate growth and leadership in this category."
— Rene Lacerte
Forward Guidance
Outlook and strategic implications:
- Growth trajectory: BILL is transitioning from stabilization to accelerated growth driven by cross-sell between BILL AP, AR, and Spend & Expense; embedded FI partnerships; and ecosystem expansion. Management guides for FY2025 total revenue of $1.415–1.450B (10%–12% YoY) with core revenue growth of 13%–16%, and a longer-term target of 20%+ core revenue growth in FY2026. These targets assume gradual stabilization in the macro environment and continued momentum in the embedded and Spend & Expense portfolios.
- Monetization and mix: The company aims to expand ad valorem monetization to potentially exceed 20% of ex-FI TPV over the long term. Near-term progress will hinge on expanding payment offerings, higher card usage, improved reconciliation, and supplier enablement. Float revenue remains a key cash-generation engine that funds growth investments without diluting shareholder value, with float yield assumptions around 400–470 basis points for FY2025.
- Margin trajectory and investments: In FY2025, BILL intends to invest approximately $45M in growth initiatives while maintaining a path toward ex-float profitability and free cash flow expansion. The midpoint guidance implies a modest near-term margin compression due to investments, offset by improving monetization and scale in subsequent years.
- Key risks: The main downside risks include a slower-than-expected stabilization in B2B spend, weaker cross-border/FX dynamics, competitive intensification in SMB financial operations platforms, and execution risk in expanding new embedded APIs and supplier-focused capabilities. Macro-conditions and regulatory changes in payments could influence TPV mix and take rates.
- Monitoring indicators for investors: 1) Take-rate progression in H2 FY2025 and into FY2026; 2) Ad valorem monetization penetration and contribution from Spend & Expense cross-sell; 3) Embedded solutions adoption with Xero and FI partners; 4) Maintenance of healthy cash conversion, FCF, and leverage metrics; 5) Progress on supplier enablement and invoice financing uptake as a share of working capital solutions.
- Bottom line: The company signals an offensive growth posture with a clear multi-year agenda to scale revenue and profitability through platform integration, ecosystem expansion, and monetization enhancements, supported by a robust balance sheet and substantial cash generation.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
BILL Focus
76.75%
-6.35%
0.18%
184.76%
DDOG
82.20%
4.70%
2.67%
184.85%
ASAN
89.80%
-39.70%
-19.10%
-15.65%
GTLB
90.20%
-20.10%
-6.38%
-76.34%
TEAM
80.50%
-5.63%
-19.10%
-58.91%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Billcom is positioned to transition from stabilization to a multi-year growth trajectory anchored in platform expansion, cross-sell momentum, and embedded finance adoption. The FY2025 guidance implies a conservative near-term growth path with a robust long-term target of 20%+ core revenue growth in FY2026, supported by planned investments (~$45M in FY2025) to enhance international payments, card usage, supplier enablement, and accounting go-to-market capabilities. The company’s defensible moat includes float-driven cash generation, a scalable platform with a broad partner ecosystem (Xero, top banks), and a large SMB TAM (roughly 6 million SMBs in the U.S.). Net cash position and a disciplined buyback program underpin an attractive capital allocation backdrop. Key catalysts include stronger monetization of ad valorem payments, expanded Spend & Expense adoption, and deeper cross-sell within the accounting channel. Risks include macro volatility, execution risk across embedded partnerships, and potential churn if monetization fails to scale as expected. Overall, BILL offers a compelling growth-and-leverage narrative for investors with a long-term horizon, contingent on continued execution and macro stability.
Key Investment Factors
Growth Potential
A multi-year growth trajectory anchored in (a) deeper cross-sell between BILL AP and Spend & Expense, (b) expanded ad valorem monetization targeting 20%+ of ex-FI TPV, (c) continued embedded finance expansion with FI partners and ERP ecosystems (e.g., Xero), and (d) supplier enablement and working-capital solutions (invoice financing) that broaden addressable market and monetization levers.
Profitability Risk
Key risks include: (1) macro headwinds dampening SMB spending and payment volumes, (2) execution risk in scaling new monetization modalities and embedding capabilities, (3) competition from fintechs and traditional ERP/payments incumbents, (4) reliance on large FI partners for RPO revenue, (5) regulatory and compliance challenges in cross-border and virtual card ecosystems, and (6) potential dilution or timing risk from large-scale share repurchases vs. growth investments.
Financial Position
Strong liquidity with $1.6B in cash, cash equivalents and short-term investments; net debt of approximately -$170.2M indicates net cash position. The balance sheet features substantial goodwill and intangible assets (Goodwill $2.396B; Intangibles $281.5M) alongside a diversified revenue model with float-based cash flow. Free cash flow generation ($73.1M in Q4 alone; $258M for full-year FY2024) supports ongoing buybacks and funding of growth initiatives. The company maintains a disciplined capital allocation framework (repurchased $234M of 2025 convertible notes; $300M planned share repurchase).
SWOT Analysis
Strengths
Integrated cloud-based financial operations platform with BILL AP, AR, and Spend & Expense
Strong gross margins: non-GAAP gross margin of 85% in Q4 2024
Large cash position and cash flow generation (FCF $258M in FY2024; Q4 FCF $73M)
Significant cross-sell and ecosystem footprint (11,500 joint customers using AP+Spend & Expense; 7.1M network members)
Embedded finance strategy with Xero partnership and FI channel expansion
Weaknesses
GAAP profitability remains negative on operating income (though non-GAAP shows solid profitability)
Relies on float revenue for cash flow advantages, introducing a float-related earnings dynamic
Concentration risk with a major FI partnership; RPO revenue is sensitive to partner terms
Significant goodwill/intangible asset base implying impairment risk if growth slows
Opportunities
Ad valorem monetization upside targeting >20% of ex-FI TPV
Invoice financing and working capital solutions leveraging platform data
Deeper engagement with accounting firms and expanding multi-entity functionality
Embedded solutions expansion via partnerships (e.g., Xero) and broader FI ecosystem
Threats
Macro deterioration in SMB spends could dampen TPV growth and monetization
Competitive intensity from established fintechs and ERP offshoots
Regulatory/compliance changes in cross-border, virtual cards, and payments
Integration risk and go-to-market execution challenges across multiple channels