Breaking Down Bill.com Holdings, Inc. (BILL) Financial Health: Key Insights for Investors

You're looking at Bill.com Holdings, Inc. (BILL) and wondering if the financial operations platform can sustain its growth story, especially as the market gets picky about profitability. Well, the fiscal year 2025 results give us a clear answer: the company has made a definitive shift, moving from a GAAP net loss to a net income of $23.8 million. Total revenue hit $1.4626 billion, a solid 13% jump year-over-year, but the real engine is their core revenue-subscription and transaction fees-which grew 16% to $1.3008 billion, powered by a 19% surge in transaction fees alone. This means their network effect is defintely working, processing $86 billion in total payment volume in the final quarter. Plus, with a new $300 million share repurchase program announced, management is signaling confidence in their cash flow and future prospects. Wall Street seems to agree, holding a consensus Buy rating with an average price target of $61.10 as of November 2025, suggesting a significant upside from current levels.

Revenue Analysis

You need a clear picture of where Bill.com Holdings, Inc. (BILL) makes its money, especially as its growth rate moderates from the hyper-growth years. The direct takeaway is that the company's revenue engine is overwhelmingly driven by transaction fees, which accounted for over 70% of its total revenue in fiscal year 2025, with float revenue providing a significant, interest-rate-sensitive boost.

For the fiscal year ended June 30, 2025, Bill.com Holdings, Inc. reported total revenue of $1,462.6 million, marking a year-over-year growth rate of 13%. While solid, this growth is a slowdown from prior periods, so it's defintely important to look at the components. Core revenue-which is subscription and transaction fees-grew faster at 16% to reach $1,300.8 million.

Three Pillars of Revenue

Bill.com Holdings, Inc. operates on a three-part revenue model, with 'Core Revenue' being the most stable, recurring part of the business. The primary revenue sources are Subscription Fees, Transaction Fees, and Float Revenue (interest on customer funds). Here's the quick math on how the 2025 fiscal year revenue breaks down:

• Transaction Fees: The largest segment, generating $1,028.7 million.
• Subscription Fees: The base platform access fee, totaling $272.1 million.
• Float Revenue: Interest earned on funds held for customers, contributing $161.8 million.

Transaction fees are the clear growth driver, surging 19% year-over-year, while subscription fees saw a more modest 6% increase. This means the company is successfully monetizing the volume of payments processed ($86 billion in Q4 2025 alone), even as new customer acquisition (subscription) growth slows.

The table below shows the segment contribution to the total 2025 fiscal year revenue, which helps visualize the reliance on transaction volume:

Near-Term Risks and Opportunities

The biggest change in the revenue mix is the continued dominance of transaction fees and the volatility of float revenue. Float revenue, which is essentially interest income, is sensitive to the Federal Reserve's interest rate policy. It provided a substantial boost in 2025 due to higher rates, but any rate cuts in the future would directly pressure this $161.8 million segment.

The opportunity is in the core business. The high growth in transaction fees, coupled with a strong net dollar retention rate of 94%, means existing customers are using the platform more, which is a sign of platform stickiness and network effects (where the product gets more valuable as more people use it). The company is also expanding into mid-market solutions and AI-powered finance agents, aiming to increase the average revenue per user (ARPU) and diversify the core revenue base. To get a deeper dive into the company's strategic positioning, you should read our full analysis: Breaking Down Bill.com Holdings, Inc. (BILL) Financial Health: Key Insights for Investors.

Action: Monitor the next few quarters for the growth rate of Subscription Fees; if it drops below 5%, it signals a deeper challenge in new customer acquisition or product value perception.

Profitability Metrics

You want to know if Bill.com Holdings, Inc. (BILL) is truly profitable, and the answer is yes, but you have to look past the standard accounting numbers (GAAP) to see the full picture. The big takeaway for fiscal year 2025 is that Bill.com crossed the line into GAAP net income, reporting $23.8 million in profit, a major shift from the prior year's loss. Still, the non-GAAP figures-which strip out things like stock-based compensation-show the real operational efficiency.

Here's the quick math on their FY2025 performance, which ended June 30, 2025, based on total revenue of $1,462.6 million:

• Gross Profit Margin: The GAAP gross margin was 81.4%, with a gross profit of $1,190.5 million.
• Operating Profit Margin: The GAAP operating margin was still negative at -5.51%, reflecting an operating loss of $80.6 million.
• Net Profit Margin: The GAAP net margin was a thin but positive 1.63%, translating to $23.8 million in net income.

The non-GAAP (Generally Accepted Accounting Principles) numbers are where the underlying business strength shines, showing a non-GAAP gross margin of 85.0% and non-GAAP operating income of $239.5 million for FY2025. That's a very high-quality revenue base.

Operational Efficiency and Margin Trends

The trend in profitability is defintely moving in the right direction, and that's the most important signal for a growth company like this. The GAAP operating loss improved dramatically from $174.2 million in FY2024 to $80.6 million in FY2025. This is a clear sign of better cost management and scale kicking in. The management team is focused on this, stating they are 'sharpening our focus on expanding profitability'.

The gross margin, while still elite, saw a slight dip from 81.8% in the prior fiscal year to 81.4% in FY2025. This is normal; as a software company expands its payments volume, the cost of processing those transactions-the cost of goods sold (COGS)-can rise slightly, putting pressure on the margin. But an 81.4% gross margin is still fantastic, showing their core technology platform is highly scalable, which is the key to their Mission Statement, Vision, & Core Values of Bill.com Holdings, Inc. (BILL).

Comparing Bill.com to the Industry

When you stack Bill.com's profitability ratios up against the industry averages for software and FinTech, the picture is complex but mostly positive. They dominate on the top line but still have work to do on the bottom line to match the mature players.

Here is a quick comparison of the Trailing Twelve Months (TTM) profitability ratios for Bill.com versus the industry average:

Bill.com's gross margin is a massive outperformance, nearly 22 percentage points higher than the industry average. This tells you their product and service delivery model is incredibly efficient. However, the negative operating margin and the low net margin show that their operating expenses-like sales, marketing, and R&D-are still high relative to revenue. This is the classic trade-off for a growth-focused platform: sacrifice near-term net profitability to capture market share and scale the business. The clear action here is to watch the non-GAAP operating income trend. It hit $239.5 million in FY2025, up 22% year-over-year, which indicates they are successfully turning growth into real, cash-based operational profit.

Debt vs. Equity Structure

You're looking at Bill.com Holdings, Inc. (BILL) and wondering how their balance sheet stacks up, especially how they fund their growth. The short answer is they lean heavily on equity and use debt strategically, mostly through convertible notes, which is typical for a high-growth FinTech company.

Their financial structure as of the end of fiscal year 2025 (June 30, 2025) shows a healthy, low-leverage profile. This approach provides financial flexibility, allowing them to invest aggressively in their platform and pursue acquisitions without the burden of high-interest debt payments.

Here's the quick math on their leverage:

• Total Stockholders' Equity: $3.914 billion
• Long-Term Convertible Notes, net: $1.501 billion

Using the primary long-term debt figure of $1.501 billion against the total equity of $3.914 billion, the Debt-to-Equity (D/E) ratio is approximately 0.38. This is defintely a low ratio, especially when you compare it to the broader technology sector, where a D/E ratio below 0.50 is generally considered strong, and much lower than capital-intensive industries.

The company's debt is almost entirely composed of convertible senior notes, which are a hybrid security (debt that can be converted into stock). This is a smart way to raise capital cheaply when your stock price is high, as the notes carry a 0% interest rate. The total long-term portion of their convertible senior notes, net of issuance costs, stood at $1.501 billion as of June 30, 2025. The key is that they are not paying regular interest, which preserves cash flow.

The near-term risk to watch was the maturity of their original 0% Convertible Senior Notes due in December 2025. However, Bill.com Holdings, Inc. executed a significant refinancing action in the second quarter of fiscal year 2025 (December 2024). They issued $1.4 billion in new 0% Convertible Senior Notes due in 2030.

They used a portion of those proceeds to buy back approximately $133.9 million aggregate principal amount of the outstanding 2025 Notes for about $130.8 million in cash. This action effectively pushed a significant debt maturity five years out, a classic move to manage the balance sheet and avoid a large cash outflow in the near-term. Plus, they repurchased approximately 2.3 million shares of common stock for around $200 million in the same quarter, balancing debt management with returning value to shareholders. This dual-action shows confidence in their cash flow generation and future equity value. For more on the full fiscal year performance, check out Breaking Down Bill.com Holdings, Inc. (BILL) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You want to know if Bill.com Holdings, Inc. (BILL) can cover its near-term obligations, and the answer is a qualified 'yes.' The company maintains a healthy liquidity position, but you need to look past the surface-level ratios to understand the true strength of its cash engine.

In fiscal year 2025, Bill.com Holdings, Inc. showed solid current liquidity, which is the ability to meet short-term debts. The real story here is the quality of their current assets and the shift toward generating cash from operations.

Current and Quick Ratios (Liquidity Positions)

The standard liquidity metrics for the fiscal year ended June 30, 2025, indicate a safe, though not overly liquid, position. Here's the quick math:

A Current Ratio of 1.58 is good; it means they have enough assets to cover their liabilities with a decent margin. The Quick Ratio of 0.64 is lower, but for a technology platform, this is defintely not a concern. They don't have warehouses full of goods to sell off, so the Quick Ratio naturally sits below the Current Ratio.

Analysis of Working Capital Trends

The working capital trend for Bill.com Holdings, Inc. is focused on optimizing the cash flow cycle for its customers, which indirectly strengthens its own position. The launch of the BILL Cash Account in October 2025 is a concrete example of this strategy.

• Boosts SMB cash positions by offering high-yield operating accounts.
• Aims to turn idle cash into working capital for its small and midsize business (SMB) clients.
• Simplifies treasury and payments, which tightens the overall financial ecosystem the company operates within.

This focus on improving customer working capital is a smart move; it increases customer stickiness and payment volume, which are the core drivers of Bill.com Holdings, Inc.'s revenue and cash flow.

Cash Flow Statements Overview

The most important takeaway for investors is the fundamental shift to GAAP profitability and strong cash generation. For the full fiscal year ended June 30, 2025, Bill.com Holdings, Inc. reported a GAAP net income of $23,799 thousand, a significant turnaround from the prior year's net loss.

This positive net income, combined with non-cash add-backs like stock-based compensation, translates to robust cash flow from operations. The company's confidence in its cash flow generation is best demonstrated by the August 2025 announcement of a $300 million share repurchase program, which they expect to fund using existing cash.

Potential Liquidity Concerns or Strengths

The primary strength is the business model's inherent ability to generate cash and their substantial cash and short-term investments on the balance sheet. The main potential concern for Bill.com Holdings, Inc. is managing its convertible senior notes, which are part of its long-term financing strategy. They have been actively managing this debt, including repurchasing notes in prior periods, showing a proactive approach to capital structure.

The strong cash flow generation is a clear strength, giving management the flexibility to invest in growth, pursue strategic acquisitions, or return capital to shareholders via buybacks. This is a company with ample liquidity to execute its strategy. You can dive deeper into who is betting on this performance by reading Exploring Bill.com Holdings, Inc. (BILL) Investor Profile: Who's Buying and Why?

Valuation Analysis

You're looking at Bill.com Holdings, Inc. (BILL) and wondering if the market has it right. Is it overvalued, or is the recent stock drop a defintely compelling entry point? The short answer is: it's complicated, typical for a high-growth Software-as-a-Service (SaaS) company transitioning to profitability.

The stock has taken a beating, which is the first thing you need to acknowledge. Over the last 12 months, the share price has decreased by 44.16%. As of mid-November 2025, the stock trades around $50.35, a stark contrast to its 52-week high of $100.19. This steep decline is why activist investors are involved, pushing for operational efficiency, but it also means the valuation multiples are volatile.

Let's break down the key valuation multiples for Bill.com Holdings, Inc. using the latest 2025 fiscal year data:

• Price-to-Earnings (P/E) Ratio: The GAAP (Generally Accepted Accounting Principles) diluted Earnings Per Share (EPS) for Fiscal Year 2025 was ($0.07), reflecting the company's focus on growth over immediate GAAP profit. However, forward-looking estimates paint a picture of extreme growth expectation, with a projected future P/E ratio around 327.4x. That's a massive premium you'd pay for future earnings.
• Price-to-Book (P/B) Ratio: The latest P/B ratio from financial reports stands at approximately 3.23874. This is a reasonable multiple for a software company, suggesting the market values the company at over three times its net asset value, which is common for businesses with intangible assets like intellectual property and a strong network effect.
• Enterprise Value-to-EBITDA (EV/EBITDA): This multiple helps us look past capital structure. The Trailing Twelve Months (TTM) EV/EBITDA, as of September 2025, is 65.30. Here's the quick math: a multiple this high suggests either a very high expected growth rate or an overvaluation, especially since the EV/EBITDA for the full fiscal year ending June 2025 was a negative -756.1x due to negative EBITDA. You must weigh that high multiple against the company's core revenue growth, which was up 16% year-over-year in FY25.

Bill.com Holdings, Inc. does not currently pay a dividend, which is standard practice for a company reinvesting all capital back into high-growth initiatives like its new AI-driven agents and embedded partnerships.

The Wall Street consensus leans toward optimism, still seeing upside despite the volatility. Out of 20 analysts, the consensus rating is a Buy. The average 12-month price target is set at $60.91, which suggests an expected gain of over 20% from the current price. What this estimate hides is the split: 40% of analysts recommend a Hold, so caution is warranted. You can read more about what drives this growth expectation in their strategic documents, like the Mission Statement, Vision, & Core Values of Bill.com Holdings, Inc. (BILL).

So, the action item is clear: use this table to benchmark the current price against the average target of $60.91. If you believe their core revenue growth can accelerate past the 16% seen in FY25, the stock is undervalued; if not, the high valuation multiples make it a risky bet at this level.

Risk Factors

The core takeaway for Bill.com Holdings, Inc. (BILL) is that while the company is driving towards non-GAAP profitability, its near-term risks are a blend of external macroeconomic pressures and critical internal execution challenges, particularly around new product adoption and competition. You need to watch how external volatility impacts their small and midsize business (SMB) customer base, which is the engine of their revenue.

The company's full fiscal year 2025 total revenue reached $1.4626 billion, a strong figure, but that growth is defintely exposed to the same headwinds facing the 493,800 businesses they serve. When SMBs feel the pinch of inflation or high interest rates, they slow their spending, directly reducing Bill.com Holdings, Inc.'s transaction volume.

External Headwinds and Market Competition

The primary external risks are not unique to Bill.com Holdings, Inc., but they are amplified by the company's reliance on transaction fees. Macroeconomic uncertainties-like fluctuating interest rates or geopolitical conflicts-can quickly dampen the total payment volume (TPV) processed on their platform.

Competition remains fierce. The market for financial operations platforms is crowded with established players and aggressive fintech startups. Bill.com Holdings, Inc. is competing with giants like Intuit and specialized players like Brex and Ramp, plus traditional banks are getting smarter about digital offerings.

• Macro Volatility: Slows customer spending, directly cuts transaction revenue.
• Competitive Pressure: Forces higher investment in R&D and lower pricing to retain customers.
• Regulatory Changes: New rules in payments or data privacy could force costly platform overhauls.

Operational and Financial Exposure

Despite narrowing its GAAP operating loss to $80.6 million in fiscal year 2025, down from $174.2 million the prior year, the company still operates at a loss on a GAAP basis. This is a common situation for high-growth tech, but it means they must maintain a razor-sharp focus on cost management while investing heavily in innovation.

A significant operational risk is inherent in their business model: managing large sums of customer funds. In the fourth quarter of fiscal year 2025 alone, Bill.com Holdings, Inc. processed $86 billion in TPV. That scale introduces a constant, high-stakes risk of loss, errors, and fraudulent activity. They also carry credit risk related to their BILL Divvy Cards and their invoice financing offerings.

Strategic Execution and AI Reliance

The long-term opportunity hinges on Bill.com Holdings, Inc.'s ability to execute on its strategic vision, which is increasingly tied to artificial intelligence (AI) and platform expansion. The company is actively pursuing AI-driven innovation, aiming for most customers to adopt AI agents by the end of fiscal year 2026. If the deployment of these AI tools is delayed or fails to deliver the promised efficiency gains, it could slow customer adoption and retention.

The company is mitigating these execution risks by doubling down on key partnerships, notably with accounting firms, where they achieved a 60% year-over-year increase in net adds during a recent quarter. This strategy locks in a valuable distribution channel. Also, their commitment to innovation is clear; they are not just adding AI to workflows, but aiming to eliminate the workflows themselves. You can read more about the company's financial standing in Breaking Down Bill.com Holdings, Inc. (BILL) Financial Health: Key Insights for Investors.

Here's the quick math: Bill.com Holdings, Inc. must grow its core revenue-which was $1.3 billion in FY2025-faster than its investment in AI and sales channels to achieve sustainable GAAP profitability. That's the tightrope walk.

Action Item: Portfolio Manager: Model a 10% decline in transaction volume for Q1 FY2026 due to macro slowdown and assess the impact on Bill.com Holdings, Inc.'s non-GAAP operating income by the end of the week.

Growth Opportunities

You're looking past the current macro environment, which is smart, and asking where Bill.com Holdings, Inc. (BILL) actually makes its money next. The direct takeaway is this: the company is pivoting from pure growth to a balanced strategy of growth and profitability, aiming to return to a 20% core revenue growth rate by leveraging its massive network and a new wave of AI-driven products. They are defintely not sitting still.

The core of their future growth isn't just signing up more small and midsize businesses (SMBs); it's about making their existing platform indispensable. This is where their scale becomes a real competitive advantage. As of the end of fiscal year 2025, Bill.com Holdings, Inc. served nearly 500,000 businesses and connected with a network of 8 million members, including 9,000 accounting firms. That ecosystem is a powerful moat against competitors, making it easier for customers to pay or get paid faster.

Here's the quick math on their recent performance, showing the shift in focus:

The transition to GAAP net income of $23.8 million for FY2025, a significant improvement from prior losses, shows that the focus on efficiency is working. This is a critical sign of a maturing FinTech business model.

Product innovation and strategic market expansion are the clear-cut growth drivers. They are shifting their go-to-market strategy to acquire higher-value SMB clients, which naturally boosts their average revenue per user. Plus, the Emerging portfolio, which includes products like Instant Pay, is expanding rapidly, showing a 40% year-over-year growth in Q1 of fiscal year 2026. This is where the real acceleration lives.

• Product Innovations: Focusing on AI-driven agents to automate tasks and enhance customer satisfaction, which cuts down on back-office headaches.
• Strategic Expansion: Targeting the top 10,000 sellers/suppliers with their Supplier Payments Plus (SPP) product, moving up-market to capture larger transaction volumes.
• Platform Breadth: Launching new capabilities like multi-entity management, procurement, and mass-payment solutions to serve larger, more complex businesses.
• Partnerships: Bolstering their reach through strategic alignments with key players like NetSuite and Acumatica to expand their foothold in the SMB market.

What this estimate hides is the potential impact of their new cash account treasury capability, which is anticipated to increase transaction velocity across the platform. That's a direct route to higher transaction fee revenue, which is a key component of their core revenue. If you want to dive deeper into the full picture, you can read the rest of the analysis on Breaking Down Bill.com Holdings, Inc. (BILL) Financial Health: Key Insights for Investors.

Finance: Track the core revenue growth rate in the next two quarters to see if they hit the 20% target, as that's the clearest indicator of successful execution on their strategic pivot.