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Bill.com (NYSE:BILL) Surprises With Strong Q4, Growth To Accelerate Next Year


Jabin Bastian /
2021/08/26 4:14 pm EDT
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Payments and billing software maker Bill.com (NYSE:BILL) reported Q4 FY2021 results beating Wall St's expectations, with revenue up 85.8% year on year to $78.2 million. Bill.com made a GAAP loss of $41.8 million, down on its loss of $9.49 million, in the same quarter last year.

Is now the time to buy Bill.com? Access our full analysis of the earnings results here, it's free.

Bill.com (BILL) Q4 FY2021 Highlights:

  • Revenue: $78.2 million vs analyst estimates of $65.0 million (20.4% beat)
  • EPS (non-GAAP): -$0.07 vs analyst estimates of -$0.04
  • Revenue guidance for Q1 2022 is $103.7 million at the midpoint, above analyst estimates of $83.4 million
  • Management's revenue guidance for upcoming financial year 2022 is $478 million at the midpoint, predicting 100% growth (vs 42.2% in FY2021)
  • Free cash flow of $14.6 million, up from negative free cash flow of -$5.39 million in previous quarter
  • Customers: 121,200, up from 115,600 in previous quarter
  • Gross Margin (GAAP): 74%, in line with previous quarter

“We delivered record growth in fiscal 2021 as we helped SMBs across the country automate their financial operations and make billions of dollars in payments,” said René Lacerte, Bill.com CEO and Founder.

Started by René Lacerte in 2006 after selling his previous payroll and accounting software company PayCycle to Intuit, Bill.com (NYSE:BILL) is a software as a service platform that aims to make payments and billing processes easier for small and medium-sized businesses.

The adoption of financial technology software is propelled by an ongoing drive to reduce costs, and as a greater number of small-medium sized businesses digitize their back offices the demand for services like Bill.com is likely to grow.

Sales Growth

As you can see below, Bill.com's revenue growth has been impressive over the last year, growing from quarterly revenue of $42.1 million, to $78.2 million.

Bill.com Total Revenue

This was another standout quarter with the revenue up a splendid 85.8% year on year. On top of that, revenue increased $18.5 million quarter on quarter, a very strong improvement on the $5.69 million increase in Q3 2021, and a sign of acceleration of growth, which is very nice to see indeed.

Analysts covering the company are expecting the revenues to grow 68.3% over the next twelve months, although we would expect them to review their estimates once they get to read these results.

There are others doing even better than Bill.com. Founded by ex-Google engineers, a small company making software for banks has been growing revenue 90% year on year and is already up more than 400% since the IPO in December. You can find it on our platform for free.

Customer Growth

You can see below that Bill.com reported 121,200 customers at the end of the quarter, an increase of 5,600 on last quarter. That is a bit slower customer growth than last quarter but still in line with what we are used to seeing lately, suggesting that the company still has decent sales momentum.

Bill.com Customers

Key Takeaways from Bill.com's Q4 Results

Since it has still been burning cash over the last twelve months it is worth keeping an eye on Bill.com’s balance sheet, but we note that with a market capitalization of $20.6 billion and more than $1.16 billion in cash, the company has the capacity to continue to prioritise growth over profitability.

We were impressed by how strongly Bill.com outperformed analysts’ revenue expectations this quarter. And we were also excited to see the really strong revenue growth. On the other hand, there was a slight slowdown in customer growth. Zooming out, we think this impressive quarter should have shareholders feeling very positive. The company is up 4.75% on the results and currently trades at $229 per share.

Bill.com may have had a good quarter, so should you invest right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.

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The author has no position in any of the stocks mentioned.