Summary
Bill.com reported $116.4 million of revenue for its fiscal 2022 first quarter ended September 30, 2021, up 152% from the prior-year quarter. Gross profit was $86.6 million, up 154%, and gross margin reached 74.4%, up 0.6 percentage points. Operating loss widened to $76.2 million. Net loss widened to $75.7 million. Diluted EPS was -$0.78. Operating margin was -65.4%, down 35.6 percentage points. On a non-GAAP basis, gross profit was $97.0 million, gross margin was 83.3%, loss from operations was $11.1 million, net loss was $14.1 million, and net loss per share was $(0.15). The gap between GAAP and non-GAAP results reflects stock-based compensation, amortization of intangibles, and acquisition costs.
Bill.com completed the purchase of Invoice2go on September 1, 2021 for $674.3 million. The company also closed Divvy on June 1, 2021 for $2.3 billion. Bill.com served 126,800 customers at September 30, 2021, up 22% from a year earlier. Divvy added 13,500 spending businesses in September 2021, and Invoice2go added approximately 226,000 subscribers. Total payment volume for Bill.com customers was $46.9 billion, up 63%. Divvy card payment volume was $1.5 billion, and Invoice2go TPV was approximately $100 million. The platform processed 8.8 million transactions, up 35%. Divvy cards processed 4.6 million transactions, while Invoice2go processed over 100,000. The reported results include the acquired businesses only from their acquisition dates.
Cash flow and liquidity need attention. Operating cash flow was negative $21.1 million, down 797.0% from the prior-year quarter. Capital expenditures were $1.40 million, down 76.2%. Free cash flow, a non-GAAP measure, was negative $25.5 million. Current deferred revenue was $21.3 million, up 245.9%, and remaining performance obligations were $152.8 million, up 1.1%. The 2025 Notes became convertible at holders' option after September 30, 2021 once a conversion trigger was met, and Bill.com reclassified the net carrying amount as a current liability. That event adds near-term cash settlement consideration.
Guidance points to continued growth alongside losses. For the fiscal second quarter ending December 31, 2021, Bill.com expects a non-GAAP net loss of $17.0 million to $18.0 million, or $(0.18) to $(0.17) per share. For the full fiscal year ending June 30, 2022, the company forecasts a non-GAAP net loss of $78.0 million to $81.0 million, or $(0.80) to $(0.77) per share. Management said it has not provided a reconciliation of non-GAAP guidance to GAAP because certain excluded items cannot be reasonably calculated or predicted. That leaves GAAP profitability out of the near-term picture.
Risks remain substantial. The COVID-19 pandemic continues to create uncertainty for customers, partners, and operations. Bill.com has a history of operating losses, and the company expects expenses to increase in absolute dollars. The company transfers large sums of customer funds daily, which exposes it to loss, errors, and fraudulent activity. Integration of Divvy and Invoice2go carries execution risk, including accounting and internal controls. Competition, the ability to attract new customers, and staffing changes are other named risks. The convertible notes add potential dilution and cash settlement obligations.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2022 | Q4 FY2021 | QoQ | Q1 FY2021 | YoY |
|---|---|---|---|---|---|
| Revenue | $116.4M | $78.3M | +48.7% | $46.2M | +151.9% |
| Gross profit | $86.6M | $58.0M | +49.3% | $34.1M | +153.8% |
| Gross margin | 74.4% | 74.1% | +0.3 pp | 73.8% | +0.6 pp |
| Research & development | $42.5M | $29.7M | +43.1% | $17.8M | +138.8% |
| Sales & marketing | $62.3M | $29.1M | +114.1% | $12.9M | +382.7% |
| General & administrative | $57.9M | $69.9M | -17.1% | $17.2M | +237.0% |
| Total operating expenses | $162.7M | $128.7M | +26.4% | $47.9M | +239.8% |
| Operating income (loss) | -$76.2M | -$70.7M | -7.7% | -$13.8M | -452.6% |
| Operating margin | -65.4% | -90.3% | +24.9 pp | -29.8% | -35.6 pp |
| Net income (loss) | -$75.7M | -$41.9M | -80.8% | -$13.0M | -484.4% |
| Net margin | -65.0% | -53.5% | -11.5 pp | -28.0% | -37.0 pp |
Risks
The company disclosed a material weakness in internal control over financial reporting in this filing. If remediation is ineffective or controls do not keep pace with acquisitions, its ability to produce timely and accurate financial statements could be impaired.
The September 1, 2021 acquisition of Invoice2go for $674.3 million adds operations in Australia and subscribers in approximately 150 countries, while the company had previously conducted very limited international business. Integration, retention of key personnel, and implementing public-company controls may not realize expected benefits.
Divvy card receivables are purchased from Cross River Bank and WEX Bank, and the company bears entire credit risk if spending businesses fail to pay card balances. Ineffective collection or risk models could cause charge-offs and harm funding relationships.
Divvy relies on warehouse facilities and purchase arrangements with finance partners to fund receivables purchases. If funding is not renewed, interrupted, or available on acceptable terms, the company may have to use limited corporate cash or reduce card lending.
As of September 30, 2021, the conversion condition for the 2025 Notes was triggered, allowing holders to convert in the following quarter, and the company had $1.15 billion of 2025 Notes and $575.0 million of 2027 Notes outstanding. Settlement may require cash and reduce liquidity.
Net loss widened to $75.7 million in the three months ended September 30, 2021 from $13.0 million in the prior-year quarter, and loss from operations widened. The company has a history of operating losses and expects costs to increase, so it may not achieve or sustain profitability.
The company is subject to money transmitter, anti-money laundering, and card network rules; regulators have previously identified violations, assessed fines, and found gaps in its anti-money laundering program. Divvy's bank partnership structure also faces true lender and valid when made challenges.
Accounting firm partners accounted for approximately 51% of total customers as of September 30, 2021 and approximately 46% of total revenue for the quarter. Losing accounting firm relationships or failing to grow them could weaken growth prospects.
The company is responsible for verifying customer identities and monitoring transactions, and has faced stolen identities, account takeover, and check fraud. General and administrative expenses included a $5.2 million increase in provision for card and fraud losses in the quarter.
The Intuit QuickBooks integration has added thousands of customers, but the agreement terminates on June 26, 2023, and Intuit has integrated another third-party bill pay solution and may develop or acquire a competing solution.
Revenue includes interest earned on customer funds held in trust, which is subject to market conditions and fell sharply due to Federal Reserve emergency interventions. Low rates may continue to adversely impact this revenue.
The market for financial back-office solutions is fragmented and competitive, and competitors may leverage artificial intelligence and data assets to offer lower-cost or more advanced products. The company must differentiate its AI-enabled platform.
COVID-19 restrictions and economic uncertainty may continue to negatively impact customers, payment volumes, supply chains, and labor, and could cause customers to cancel subscriptions or request discounts.
SaaS KPIs
All quarters →Free Cash Flow
Non-GAAP Gross Margin
Invoice2go subscribers
Remaining performance obligations (Total)
Non-GAAP loss from operations
Summary, forecast, risks and KPIs are extracted from BILL Holdings, Inc.'s SEC filings for Q1 FY2022 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.