Business Wire | Feb 4, 2021 04:06PM EST

Bill.com Reports Second Quarter Fiscal 2021 Financial Results

Feb. 04, 2021

SAN JOSE, Calif.--(BUSINESS WIRE)--Feb. 04, 2021--Bill.com (NYSE: BILL), a leading provider of cloud-based software that simplifies, digitizes, and automates complex back-office financial operations for small and midsize businesses (SMBs), today announced financial results for the second fiscal quarter ended December 31, 2020.

"We delivered strong financial results and record payment volume growth driven by robust demand for our platform and its expanded payment offerings," said Ren Lacerte, Bill.com CEO. "Adoption and usage continues to strengthen in this new remote environment as we are effectively guiding companies on their digital transformation path. Our offering has become a mission-critical tool for many small and midsize businesses. The increasing scale of our platform purpose-built for SMBs is automating financial operations facilitating over ten billion dollars of B2B payments each month."

Financial Highlights for the Second Quarter of Fiscal 2021

* Total revenue was $54.0 million, an increase of 38% from the second quarter of fiscal 2020. * Core revenue, which includes subscription and transaction fees, was $52.3 million, an increase of 59% year-over-year. Subscription fees were $26.6 million, an increase of 33% year-over-year. Transaction fees were $25.7 million, an increase of 98% year-over-year. * GAAP gross profit was $40.1 million, representing a 74.1% gross margin, compared to $29.3 million, or a 75.0% gross margin, in the second quarter of fiscal 2020. Non-GAAP gross profit was $41.8 million, representing a 77.3% non-GAAP gross margin, compared to $30.5 million, or a 78.0% non-GAAP gross margin in the second quarter of fiscal 2020. * Loss from operations was $14.2 million, compared to a loss from operations of $7.9 million in the second quarter of fiscal 2020. Non-GAAP loss from operations was $2.7 million, compared to a non-GAAP loss from operations of $4.5 million in the second quarter of fiscal 2020. * Net loss was $17.2 million, or ($0.21) per share, basic and diluted, compared to net loss of $7.6 million, or ($0.34) per share, basic and diluted, in the second quarter of fiscal 2020. Non-GAAP net loss was $2.1 million, or ($0.03) per share, basic and diluted, compared to non-GAAP net loss of $3.6 million, or ($0.06) per share, basic and diluted, in the second quarter of fiscal 2020. * Cash, cash equivalents and short-term investments were $1.7 billion at December 31, 2020.

Business Highlights and Recent Developments

* Served 109,200 customers as of the end of the second quarter of fiscal 2021, representing year-over-year customer growth of 27% * Processed $34.8 billion in total payment volume on our platform in the second quarter, an increase of 40% year-over-year and 21% quarter-over-quarter * Processed 7.2 million transactions in the second quarter of fiscal 2021 * Introduced Bill Manager with Wells Fargo, a new joint offering to help automate and simplify the accounts payable and receivable process for midsize businesses * Launched a tailored offering for wealth management firms to help deliver bill pay services for high-net-worth clients * Added seasoned technology and payments executive, Steve Fisher, to our board of directors * Completed an offering of $1.15 billion of 0% convertible senior notes due 2025 ("2025 Notes")

Conference Call

In conjunction with this announcement, Bill.com will host a conference call at 1:30 p.m. PT (4:30 p.m. ET) today to discuss second quarter results as well as our outlook for the third quarter of fiscal 2021. The conference call will be available via live webcast and replay at the Investor Relations section of Bill.com's website: https://investor.bill.com/events-and-presentations/default.aspx.

About Bill.com

Bill.com is a leading provider of cloud-based software that simplifies, digitizes, and automates complex, back-office financial operations for small and midsize businesses. Customers use the Bill.com platform to manage end-to-end financial workflows and to process payments. The Bill.com AI-enabled, financial software platform creates connections between businesses and their suppliers and clients. It helps manage cash inflows and outflow. The company partners with several of the largest U.S. financial institutions, the majority of the top 100 U.S. accounting firms, and popular accounting software providers. Bill.com has offices in San Jose, California and Houston, Texas. For more information, visit www.bill.com.

Note on Forward-Looking Statements

This press release and the accompanying conference call include forward-looking statements, which are statements other than statements of historical facts, and statements in the future tense. Forward-looking statements are based on our expectations as of the date of this press release and are subject to a number of risks, uncertainties and assumptions, many of which involve factors or circumstances that are beyond our control. These statements include, but are not limited to, statements regarding our expectations for future performance, the growth of demand on our platform and the expansion of our customers' utilization of our services. These risks and uncertainties include, but are not limited to, the novel coronavirus pandemic (COVID-19) and its impact on our employees, customers, strategic partners, vendors, results of operations, liquidity and financial condition, our history of operating losses, our recent rapid growth, the large sums of customer funds that we transfer daily, the risk of loss, errors and fraudulent activity, the market, interest rate, foreign exchange and other conditions that the customer funds we hold in trust are subject to, our ability to attract new customers and convert trial customers into paying customers, our ability to develop new products and services, increased competition or new entrants in the marketplace, potential impact of acquisitions and investments, changes in staffing levels, and other risks detailed in registration statements and periodic reports we file with the SEC, including our annual report on Form 10-K filed with the SEC on August 31, 2020, which may be obtained on the Investor Relations section of Bill.com's website ( https://investor.bill.com/financials/sec-filings/default.aspx) and on the SEC website at www.sec.gov. Additional information will also be set forth in our quarterly report on Form 10-Q for the three months ended December 31, 2020 when filed. Actual results may differ materially from those presently reported. All forward-looking statements in this press release are based on information available to us as of the date hereof. We assume no obligation to update the information contained in this press release or the accompanying conference call.

Non-GAAP Financial Measures

In addition to financial measures prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), this press release and the accompanying tables contain, and the conference call will contain, non-GAAP financial measures, including non-GAAP loss from operations, non-GAAP net loss and non-GAAP net loss per share, basic and diluted. The non-GAAP financial information is presented for supplemental informational purposes only and is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP.

We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects and allow for greater transparency with respect to important metrics used by our management for financial and operational decision-making. We believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry. However, it is important to note that the particular items we exclude from, or include in, our non-GAAP financial measures may differ from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry.

We adjust the following items from one or more of our non-GAAP financial measures:

Stock-based compensation expense. We exclude stock-based compensation expense, which is a non-cash expense, from certain of our non-GAAP financial measures because we believe that excluding this item provides meaningful supplemental information regarding operational performance. In particular, companies calculate stock- based compensation expenses using a variety of valuation methodologies and subjective assumptions.

Employer payroll taxes related to employee stock-based compensation. We exclude payroll tax expense related to employee stock-based transactions because we believe that excluding this item provides meaningful supplemental information regarding operational performance. In particular, this expense is dependent on the price of our common stock and other factors that are beyond our control and do not correlate to the operation of our business. Employer payroll tax expense related to employee stock-based compensation was not material for all periods prior to June 30, 2020; therefore, it was excluded from those prior periods.

Depreciation and amortization expense. We exclude depreciation and amortization expenses from certain of our non-GAAP financial measures because we believe that excluding this item provides meaningful supplemental information regarding operational performance.

Capitalized internal-use software and amortization. We include capitalization and exclude the subsequent amortization of internal-use software costs in certain of our non-GAAP financial measures. We capitalize direct costs incurred related to obtaining or developing internal-use software during the application development stage and we amortize those costs over the estimated useful lives of the software. The capitalization and subsequent amortization of those costs can vary every period depending on our business needs and the timing on the software's availability for its intended use. We believe that including or excluding the effect of the capitalized internal-use software in certain of our non-GAAP financial measures provides us useful information in evaluating and comparing the consistency of our operating performance on a period-to-period basis.

Deferred costs and amortization. Deferred costs consist of capitalized sales commissions and capitalized service costs. We include capitalization of sales commission and service costs, and exclude their subsequent amortization in certain of our non-GAAP financial measures. We capitalize sales commissions that are incremental costs in obtaining new customer contracts. We capitalize service costs, which pertain primarily to direct payroll and third-party costs incurred when we provide implementation services to our financial institution customers and certain SMB customers prior to the launching of our product for general use. We amortize the capitalized sales commissions and capitalized service costs over the estimated benefit period. We believe that including or excluding the effect of the capitalization of sales commissions and service costs in certain of our non-GAAP financial measures in a given period provides us useful information in evaluating and comparing the consistency of our performance in acquiring new customer contracts on a period-to-period basis.

Amortization of debt discount and issuance costs. We exclude the amortization of debt discount and issuance costs associated with our issuance of convertible senior notes due 2025 from certain of our non-GAAP financial measures because we believe that excluding this non-cash interest expense provides meaningful supplemental information regarding our operational performance.

Loss on revaluation of warrant liabilities. We exclude loss on revaluation of warrant liabilities, which is a non-cash expense, from certain of our non-GAAP financial measures because we believe that excluding this item provides meaningful supplemental information regarding operational performance.

Income tax benefit associated with 2025 Notes. We exclude the income tax benefit associated with 2025 Notes from certain of our non-GAAP financial measures because we believe that excluding this provides meaningful supplemental information regarding our operational performance.

There are material limitations associated with the use of non-GAAP financial measures since they exclude significant expenses and income that are required by GAAP to be recorded in our financial statements. Please see the reconciliation tables at the end of this release for the reconciliation of GAAP and non-GAAP results.

BILL.COM HOLDINGS, INC.CONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited, in thousands) December 31, June 30,

2020 2020

ASSETSCurrent assets:Cash and cash equivalents $ 1,568,684 $ 573,643

Short-term investments 165,588 123,974

Accounts receivable, net 7,037 4,252

Unbilled revenue 7,370 6,549

Prepaid expenses and other current assets 18,748 26,781

Funds held for customers 2,217,680 1,644,250

Total current assets 3,985,107 2,379,449

Non-current assets:Operating lease right-of-use assets 44,771 -

Property and equipment, net 30,572 13,866

Other assets 21,967 10,700

Total assets $ 4,082,417 $ 2,404,015

LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilities:Accounts payable $ 5,076 $ 3,478

Accrued compensation and benefits 14,304 12,387

Other accrued and current liabilities 6,600 8,541

Deferred revenue 5,379 5,891

Line of credit borrowings 2,300 2,300

Operating lease liabilities 4,727 -

Customer fund deposits 2,217,680 1,644,250

Total current liabilities 2,256,066 1,676,847

Non-current liabilities:Deferred revenue 3,166 2,622

Operating lease liabilities 54,141 -

Convertible senior notes, net 886,052 -

Deferred income tax liability 1,832 -

Other long-term liabilities 4,412 13,827

Total liabilities 3,205,669 1,693,296

Commitments and contingenciesStockholders' equity:Common stock 2 2

Additional paid-in capital 1,055,425 857,044

Accumulated other comprehensive income 198 2,420

Accumulated deficit (178,877 ) (148,747 )

Total stockholders' equity 876,748 710,719

Total liabilities and stockholders' equity $ 4,082,417 $ 2,404,015

BILL.COM HOLDINGS, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited, in thousands except per share amounts)Three months ended December 31,

Six months ended December 31,

2020

2019

2020

2019

RevenueSubscription and transaction fees$

52,333

$

32,964

$

96,121

$

61,512

Interest on funds held for customers1,712

6,116

4,133

12,748

Total revenue54,045

39,080

100,254

74,260

Cost of revenue (1)13,973

9,787

26,079

18,934

Gross profit40,072

29,293

74,175

55,326

Operating expensesResearch and development (1)20,486

12,992

38,272

24,507

Sales and marketing (1)14,174

11,491

27,082

21,758

General and administrative (1)19,583

12,748

36,773

23,283

Total operating expenses54,243

37,231

102,127

69,548

Loss from operations(14,171

)

(7,938

)

(27,952

)

(14,222

)

Other (expense) income, net(3,341

)

360

(2,511

)

999

Loss before (benefit from) provision for income taxes(17,512

)

(7,578

)

(30,463

)

(13,223

)

(Benefit from) provision for income taxes(333

)

-

(333

)

51

Net loss$

(17,179

)

$

(7,578

)

$

(30,130

)

$

(13,274

)

Net loss per share attributable tocommon stockholders, basic and diluted$

(0.21

)

$

(0.34

)

$

(0.37

)

$

(0.87

)

Weighted-average number of common sharesused to compute net loss per shareattributable to common stockholders,basic and diluted81,519

22,306

80,868

15,268

(1) Includes stock-based compensation expense as follows:Cost of revenue$

642

$

211

$

1,243

$

359

Research and development3,246

1,084

6,315

1,755

Sales and marketing1,871

494

3,375

877

General and administrative4,930

1,286

9,650

2,360

$

10,689

$

3,075

$

20,583

$

5,351

BILL.COM HOLDINGS, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited, in thousands except per share amounts) Three months ended Six months ended December 31, December 31,

2020 2019 2020 2019

RevenueSubscription and $ 52,333 $ 32,964 $ 96,121 $ 61,512 transaction feesInterest on funds held 1,712 6,116 4,133 12,748 for customersTotal revenue 54,045 39,080 100,254 74,260

Cost of revenue ^(1) 13,973 9,787 26,079 18,934

Gross profit 40,072 29,293 74,175 55,326

Operating expensesResearch and 20,486 12,992 38,272 24,507 development ^(1)Sales and marketing ^ 14,174 11,491 27,082 21,758 (1)General and 19,583 12,748 36,773 23,283 administrative ^(1)Total operating 54,243 37,231 102,127 69,548 expensesLoss from operations (14,171 ) (7,938 ) (27,952 ) (14,222 )

Other (expense) income, (3,341 ) 360 (2,511 ) 999 netLoss before (benefit (17,512 ) (7,578 ) (30,463 ) (13,223 )from) provision forincome taxes(Benefit from) (333 ) - (333 ) 51 provision for incometaxesNet loss $ (17,179 ) $ (7,578 ) $ (30,130 ) $ (13,274 )

Net loss per shareattributable to $ (0.21 ) $ (0.34 ) $ (0.37 ) $ (0.87 )common stockholders,basic and dilutedWeighted-average numberof common sharesused to compute net 81,519 22,306 80,868 15,268 loss per shareattributable to commonstockholders,basic and diluted ^(1) Includes stock-basedcompensation expense as follows:Cost of revenue $ 642 $ 211 $ 1,243 $ 359

Research and 3,246 1,084 6,315 1,755 developmentSales and marketing 1,871 494 3,375 877

General and 4,930 1,286 9,650 2,360 administrative $ 10,689 $ 3,075 $ 20,583 $ 5,351

BILL.COM HOLDINGS, INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited, in thousands)Three months ended December 31,

Six months ended December 31,

2020

2019 (1)

2020

2019 (1)

Cash flows from operating activities:Net loss$

(17,179

)

$

(7,578

)

$

(30,130

)

$

(13,274

)

Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization999

1,120

1,924

2,105

Stock-based compensation10,689

3,075

20,583

5,351

Amortization of debt discount and issuance costs3,905

-

3,905

-

Amortization of premium (accretion of discount) on investment in marketable debt securities677

(1,616

)

723

(2,346

)

Non-cash operating lease expense912

-

1,677

-

Revaluation of warrant liabilities-

552

-

717

Deferred income tax(333

)

-

(333

)

-

Changes in assets and liabilities:Accounts receivable(1,995

)

(1,100

)

(2,785

)

(393

)

Unbilled revenue(445

)

(493

)

(821

)

(1,114

)

Prepaid expenses and other current assets(6,261

)

(466

)

(3,947

)

(1,608

)

Other assets(4,483

)

(531

)

(11,267

)

(581

)

Accounts payable(200

)

638

1,366

1,146

Accrued and other current liabilities4,492

3,419

(13

)

4,551

Operating lease liabilities1,166

-

6,930

-

Other long-term liabilities(765

)

94

573

187

Deferred revenue(406

)

1,117

32

1,110

Net cash used in operating activities(9,227

)

(1,769

)

(11,583

)

(4,149

)

Cash flows from investing activities:Purchases of corporate and customer fund short-term investments(358,097

)

(225,444

)

(701,442

)

(414,648

)

Proceeds from maturities of corporate and customer fund short-term investments256,827

152,065

501,159

407,236

Proceeds from sale of corporate and customer fund short-term investments2,000

11,964

35,286

22,725

Decrease (increase) in other receivables included in funds held for customers1,541

(6,749

)

19

(4,700

)

Purchases of property and equipment(7,742

)

(1,026

)

(13,636

)

(2,972

)

Capitalization of internal-use software costs(346

)

(125

)

(660

)

(340

)

Net cash (used in) provided by investing activities(105,817

)

(69,315

)

(179,274

)

7,301

Cash flows from financing activities:Proceeds from issuance of convertible senior notes, net of discounts and issuance costs1,129,603

-

1,129,603

-

Purchase of capped calls(87,860

)

-

(87,860

)

-

Proceeds from issuance of common stock upon initial public offering, net of underwritingdiscounts and commissions and other offering costs-

227,439

-

226,565

Increase in customer fund deposits liability548,777

25,271

573,430

162,457

Proceeds from exercise of stock options8,480

607

17,442

901

Proceeds from issuance of common stock under the employee stock purchase plan-

-

4,327

-

Payments of offering costs related to the follow-on public offering-

-

(664

)

-

Proceeds from exercise of stock warrants-

144

-

144

Payments of deferred debt issuance costs-

-

-

(151

)

Net cash provided by financing activities1,599,000

253,461

1,636,278

389,916

Net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents1,483,956

182,377

1,445,421

393,068

Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of period1,553,842

1,193,859

1,592,377

983,168

Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period$

3,037,798

$

1,376,236

$

3,037,798

$

1,376,236

Reconciliation of cash, cash equivalents, restricted cash, and restrictedcash equivalents within the condensed consolidated balance sheets to theamounts shown in the condensed consolidated statements of cash flows above:Cash and cash equivalents$

1,568,684

$

314,894

$

1,568,684

$

314,894

Restricted cash included in other current assets119

256

119

256

Restricted cash and restricted cash equivalents included in funds held for customers1,468,995

1,061,086

1,468,995

1,061,086

Total cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period$

3,037,798

$

1,376,236

$

3,037,798

$

1,376,236

______________________(1) Amounts have been adjusted to reflect the adoption of Accounting Standards Update No. 2016-18, Statement of Cash Flows(Topic 230): Restricted Cash. Shown below is a summary of the adjustments during the three and six months ended December 31, 2019(in thousands).Three months ended December 31, 2019AsreportedASU No.2016-18adjustmentsAsadjustedNet cash used in operating activities$

(1,769

)

$

-

$

(1,769

)

Net cash used in investing activities(23,047

)

(46,268

)

(69,315

)

Net cash provided by financing activities253,461

-

253,461

Net increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents228,645

(46,268

)

182,377

Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of period86,249

1,107,610

1,193,859

Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period$

314,894

$

1,061,342

$

1,376,236

Six months ended December 31, 2019AsreportedASU No.2016-18adjustmentsAsadjustedNet cash used in operating activities$

(4,149

)

$

-

$

(4,149

)

Net cash (used in) provided by investing activities(161,179

)

168,480

7,301

Net cash provided by financing activities389,916

-

389,916

Net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents224,588

168,480

393,068

Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of period90,306

892,862

983,168

Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period$

314,894

$

1,061,342

$

1,376,236

BILL.COM HOLDINGS, INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited, in thousands) Three months ended Six months ended December 31, December 31,

2020 2019^ (1) 2020 2019 ^(1)

Cash flows fromoperating activities:Net loss $ (17,179 ) $ (7,578 ) $ (30,130 ) $ (13,274 )

Adjustments toreconcile net loss tonet cash used inoperating activities:Depreciation and 999 1,120 1,924 2,105 amortizationStock-based 10,689 3,075 20,583 5,351 compensationAmortization of debt 3,905 - 3,905 - discount and issuancecostsAmortization ofpremium (accretion ofdiscount) on 677 (1,616 ) 723 (2,346 )investment inmarketable debtsecuritiesNon-cash operating 912 - 1,677 - lease expenseRevaluation of warrant - 552 - 717 liabilitiesDeferred income tax (333 ) - (333 ) -

Changes in assets andliabilities:Accounts receivable (1,995 ) (1,100 ) (2,785 ) (393 )

Unbilled revenue (445 ) (493 ) (821 ) (1,114 )

Prepaid expenses and (6,261 ) (466 ) (3,947 ) (1,608 )other current assetsOther assets (4,483 ) (531 ) (11,267 ) (581 )

Accounts payable (200 ) 638 1,366 1,146

Accrued and other 4,492 3,419 (13 ) 4,551 current liabilitiesOperating lease 1,166 - 6,930 - liabilitiesOther long-term (765 ) 94 573 187 liabilitiesDeferred revenue (406 ) 1,117 32 1,110

Net cash used in (9,227 ) (1,769 ) (11,583 ) (4,149 )operating activitiesCash flows frominvesting activities:Purchases of corporate (358,097 ) (225,444 ) (701,442 ) (414,648 )and customer fundshort-term investmentsProceeds frommaturities of 256,827 152,065 501,159 407,236 corporate and customerfund short-terminvestmentsProceeds from sale ofcorporate and customer 2,000 11,964 35,286 22,725 fund short-terminvestmentsDecrease (increase) inother receivables 1,541 (6,749 ) 19 (4,700 )included in funds heldfor customersPurchases of property (7,742 ) (1,026 ) (13,636 ) (2,972 )and equipmentCapitalization of (346 ) (125 ) (660 ) (340 )internal-use softwarecostsNet cash (used in) (105,817 ) (69,315 ) (179,274 ) 7,301 provided by investingactivitiesCash flows fromfinancing activities:Proceeds from issuanceof convertible senior 1,129,603 - 1,129,603 - notes, net ofdiscounts and issuancecostsPurchase of capped (87,860 ) - (87,860 ) - callsProceeds from issuanceof common stock uponinitial publicoffering, net of - 227,439 - 226,565 underwritingdiscounts andcommissions and otheroffering costsIncrease in customer 548,777 25,271 573,430 162,457 fund depositsliabilityProceeds from exercise 8,480 607 17,442 901 of stock optionsProceeds from issuanceof common stock under - - 4,327 - the employee stockpurchase planPayments of offeringcosts related to the - - (664 ) - follow-on publicofferingProceeds from exercise - 144 - 144 of stock warrantsPayments of deferred - - - (151 )debt issuance costsNet cash provided by 1,599,000 253,461 1,636,278 389,916 financing activitiesNet increase in cash,cash equivalents, 1,483,956 182,377 1,445,421 393,068 restricted cash, andrestricted cashequivalentsCash, cashequivalents,restricted cash, and 1,553,842 1,193,859 1,592,377 983,168 restricted cashequivalents, beginningof periodCash, cashequivalents,restricted cash, and $ 3,037,798 $ 1,376,236 $ 3,037,798 $ 1,376,236 restricted cashequivalents, end ofperiod Reconciliation ofcash, cashequivalents,restricted cash, andrestrictedcash equivalentswithin the condensedconsolidated balancesheets to theamounts shown in thecondensed consolidatedstatements of cashflows above:Cash and cash $ 1,568,684 $ 314,894 $ 1,568,684 $ 314,894 equivalentsRestricted cash 119 256 119 256 included in othercurrent assetsRestricted cash andrestricted cash 1,468,995 1,061,086 1,468,995 1,061,086 equivalents includedin funds held forcustomersTotal cash, cashequivalents,restricted cash, and $ 3,037,798 $ 1,376,236 $ 3,037,798 $ 1,376,236 restricted cashequivalents, end ofperiod ______________________^(1) Amounts have been adjusted to reflect the adoption of Accounting StandardsUpdate No. 2016-18, Statement of Cash Flows(Topic 230): Restricted Cash. Shown below is a summary of the adjustmentsduring the three and six months ended December 31, 2019(in thousands). Three months ended December 31, 2019 As ASU No. As reported 2016-18 adjusted adjustmentsNet cash used in $ (1,769 ) $ - $ (1,769 )operating activitiesNet cash used in (23,047 ) (46,268 ) (69,315 )investing activitiesNet cash provided by 253,461 - 253,461 financing activitiesNet increase(decrease) in cash,cash equivalents, 228,645 (46,268 ) 182,377 restricted cash, andrestricted cashequivalentsCash, cashequivalents,restricted cash, and 86,249 1,107,610 1,193,859 restricted cashequivalents, beginningof periodCash, cashequivalents,restricted cash, and $ 314,894 $ 1,061,342 $ 1,376,236 restricted cashequivalents, end ofperiod Six months ended December 31, 2019 As ASU No. As reported 2016-18 adjusted adjustmentsNet cash used in $ (4,149 ) $ - $ (4,149 )operating activitiesNet cash (used in) (161,179 ) 168,480 7,301 provided by investingactivitiesNet cash provided by 389,916 - 389,916 financing activitiesNet increase in cash,cash equivalents, 224,588 168,480 393,068 restricted cash, andrestricted cashequivalentsCash, cashequivalents,restricted cash, and 90,306 892,862 983,168 restricted cashequivalents, beginningof periodCash, cashequivalents,restricted cash, and $ 314,894 $ 1,061,342 $ 1,376,236 restricted cashequivalents, end ofperiod BILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATATHREE MONTHS ENDED DECEMBER 31, 2020(Unaudited, in thousands except percentages and per share amounts)GAAPStock-basedcompensationexpenseEmployerpayroll taxesrelated tostock-basedcompensationexpenseDeferredcosts(amortizationof deferredcosts)DepreciationandamortizationexpenseAmortizationof debtdiscount andissuance costsIncome taxassociatedwith 2025NotesNon-GAAPTotal revenue$

54,045

$

-

$

-

$

-

$

-

$

-

$

-

$

54,045

Cost of revenue13,973

(642

)

(98

)

(154

)

(833

)

-

-

12,246

Gross profit40,072

642

98

154

833

-

-

41,799

Gross margin74.1

%

1.2

%

0.2

%

0.3

%

1.5

%

0.0

%

0.0

%

77.3

%

Operating expensesResearch and development20,486

(3,246

)

(303

)

951

(40

)

-

-

17,848

Sales and marketing14,174

(1,871

)

(171

)

483

(23

)

-

-

12,592

General and administrative19,583

(4,930

)

(533

)

-

(103

)

-

-

14,017

Loss from operations(14,171

)

10,689

1,105

(1,280

)

999

-

-

(2,658

)

Other (expense) income, net(3,341

)

-

-

-

-

3,905

-

564

Loss before benefit from income taxes(17,512

)

10,689

1,105

(1,280

)

999

3,905

-

(2,094

)

Benefit from income taxes(333

)

-

-

-

-

-

333

-

Net loss$

(17,179

)

$

10,689

$

1,105

$

(1,280

)

$

999

$

3,905

$

(333

)

$

(2,094

)

Net loss per share attributable to commonstockholders, basic and diluted (1)$

(0.21

)

$

(0.03

)

Weighted-average number of common sharesused to compute net loss per shareattributable to common stockholders,basic and diluted81,519

81,519

(1) GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.21

)

Stock-based compensation expense0.13

Employer payroll taxes related to stock-based compensation expense0.01

Deferred costs (amortization of deferred costs)(0.02

)

Depreciation and amortization expense0.01

Amortization of debt discount and issuance costs0.05

Income tax associated with 2025 Notes-

Non-GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.03

)

BILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATATHREE MONTHS ENDED DECEMBER 31, 2020(Unaudited, in thousands except percentages and per share amounts) Employer payroll Deferred Depreciation Amortization Income tax Stock-based taxes costs and of debt associated GAAP compensation related to (amortization amortization discount and with 2025 Non-GAAP expense stock-based of deferred expense issuance Notes compensation costs) costs expenseTotal revenue $ 54,045 $ - $ - $ - $ - $ - $ - $ 54,045

Cost of revenue 13,973 (642 ) (98 ) (154 ) (833 ) - - 12,246

Gross profit 40,072 642 98 154 833 - - 41,799

Gross margin 74.1 % 1.2 % 0.2 % 0.3 % 1.5 % 0.0 % 0.0 % 77.3 %

Operating expensesResearch and development 20,486 (3,246 ) (303 ) 951 (40 ) - - 17,848

Sales and marketing 14,174 (1,871 ) (171 ) 483 (23 ) - - 12,592

General and administrative 19,583 (4,930 ) (533 ) - (103 ) - - 14,017

Loss from operations (14,171 ) 10,689 1,105 (1,280 ) 999 - - (2,658 )

Other (expense) income, net (3,341 ) - - - - 3,905 - 564

Loss before benefit from income (17,512 ) 10,689 1,105 (1,280 ) 999 3,905 - (2,094 )taxesBenefit from income taxes (333 ) - - - - - 333 -

Net loss $ (17,179 ) $ 10,689 $ 1,105 $ (1,280 ) $ 999 $ 3,905 $ (333 ) $ (2,094 )

Net loss per share attributableto common $ (0.21 ) $ (0.03 )stockholders, basic and diluted(1) Weighted-average number ofcommon sharesused to compute net loss per 81,519 81,519 shareattributable to commonstockholders,basic and diluted ^(1) GAAP net loss per share attributable to common stockholders, basic $ (0.21 )and dilutedStock-based compensation expense 0.13

Employer payroll taxes related to stock-based compensation expense 0.01

Deferred costs (amortization of deferred costs) (0.02 )

Depreciation and amortization expense 0.01

Amortization of debt discount and issuance costs 0.05

Income tax associated with 2025 Notes -

Non-GAAP net loss per share attributable to common stockholders, basic $ (0.03 )and dilutedBILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATATHREE MONTHS ENDED DECEMBER 31, 2019(Unaudited, in thousands except percentages and per share amounts)GAAPStock-basedcompensationexpenseDeferredcosts(amortizationof deferredcosts)DepreciationandamortizationexpenseLoss onrevaluation ofwarrantliabilityNon-GAAPTotal revenue$

39,080

$

-

$

-

$

-

$

-

$

39,080

Cost of revenue9,787

(211

)

(185

)

(797

)

-

8,594

Gross profit29,293

211

185

797

-

30,486

Gross margin75.0

%

0.5

%

0.5

%

2.0

%

0.0

%

78.0

%

Operating expensesResearch and development12,992

(1,084

)

186

(112

)

-

11,982

Sales and marketing11,491

(494

)

766

(84

)

-

11,679

General and administrative12,748

(1,286

)

-

(127

)

-

11,335

Loss from operations(7,938

)

3,075

(767

)

1,120

-

(4,510

)

Other income, net360

-

-

-

552

912

Loss before provision for income taxes(7,578

)

3,075

(767

)

1,120

552

(3,598

)

Provision for income taxes-

-

-

-

-

-

Net loss$

(7,578

)

$

3,075

$

(767

)

$

1,120

$

552

$

(3,598

)

Net loss per share attributable to commonstockholders, basic and diluted (1)$

(0.34

)

$

(0.06

)

Weighted-average number of common sharesused to compute net loss per shareattributable to common stockholders,basic and diluted (2)22,306

62,771

(1) GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.34

)

Stock-based compensation expense0.14

Deferred costs (amortization of deferred costs)(0.03

)

Depreciation and amortization expense0.05

Loss on revaluation of warrant liability0.02

Impact of the assumed conversion of redeemable convertible preferred stock0.10

Non-GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.06

)

(2) Shares used to compute GAAP net loss per share attributable to common stockholders, basic and diluted22,306

Weighted average effect of the assumed conversion of redeemable convertible preferred stock from the date of issuance40,465

Shares used to compute non-GAAP net loss per share attributable to common stockholders, basic and diluted62,771

BILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATATHREE MONTHS ENDED DECEMBER 31, 2019(Unaudited, in thousands except percentages and per share amounts) Deferred Depreciation Loss on Stock-based costs and revaluation GAAP compensation (amortization amortization of Non-GAAP expense of deferred expense warrant costs) liabilityTotal revenue $ 39,080 $ - $ - $ - $ - $ 39,080

Cost of revenue 9,787 (211 ) (185 ) (797 ) - 8,594

Gross profit 29,293 211 185 797 - 30,486

Gross margin 75.0 % 0.5 % 0.5 % 2.0 % 0.0 % 78.0 %

Operating expensesResearch and development 12,992 (1,084 ) 186 (112 ) - 11,982

Sales and marketing 11,491 (494 ) 766 (84 ) - 11,679

General and administrative 12,748 (1,286 ) - (127 ) - 11,335

Loss from operations (7,938 ) 3,075 (767 ) 1,120 - (4,510 )

Other income, net 360 - - - 552 912

Loss before provision for income (7,578 ) 3,075 (767 ) 1,120 552 (3,598 )taxesProvision for income taxes - - - - - -

Net loss $ (7,578 ) $ 3,075 $ (767 ) $ 1,120 $ 552 $ (3,598 )

Net loss per share attributableto common $ (0.34 ) $ (0.06 )stockholders, basic and diluted^(1) Weighted-average number ofcommon sharesused to compute net loss per 22,306 62,771 shareattributable to commonstockholders,basic and diluted ^(2) ^(1) GAAP net loss per share attributable to common stockholders, basic $ (0.34 )and dilutedStock-based compensation expense 0.14

Deferred costs (amortization of deferred costs) (0.03 )

Depreciation and amortization expense 0.05

Loss on revaluation of warrant liability 0.02

Impact of the assumed conversion of redeemable convertible preferred 0.10 stockNon-GAAP net loss per share attributable to common stockholders, basic $ (0.06 )and diluted ^(2) Shares used to compute GAAP net loss per share attributable to common 22,306 stockholders, basic and dilutedWeighted average effect of the assumed conversion of redeemable convertible 40,465 preferred stock from the date of issuanceShares used to compute non-GAAP net loss per share attributable to common 62,771 stockholders, basic and dilutedBILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATASIX MONTHS ENDED DECEMBER 31, 2020(Unaudited, in thousands except percentages and per share amounts)GAAPStock-basedcompensationexpenseEmployerpayroll taxesrelated tostock-basedcompensationexpenseDeferredcosts(amortizationof deferredcosts)DepreciationandamortizationexpenseAmortizationof debtdiscount andissuance costsIncome taxassociatedwith 2025NotesNon-GAAPTotal revenue$

100,254

$

-

$

-

$

-

$

-

$

-

$

-

$

100,254

Cost of revenue26,079

(1,243

)

(143

)

(285

)

(1,557

)

-

-

22,851

Gross profit74,175

1,243

143

285

1,557

-

-

77,403

Gross margin74.0

%

1.2

%

0.1

%

0.3

%

1.6

%

0.0

%

0.0

%

77.2

%

Operating expensesResearch and development38,272

(6,315

)

(574

)

2,048

(99

)

-

-

33,332

Sales and marketing27,082

(3,375

)

(303

)

1,186

(59

)

-

-

24,531

General and administrative36,773

(9,650

)

(1,038

)

-

(209

)

-

-

25,876

Loss from operations(27,952

)

20,583

2,058

(2,949

)

1,924

-

-

(6,336

)

Other (expense) income, net(2,511

)

-

-

-

-

3,905

-

1,394

Loss before benefit from income taxes(30,463

)

20,583

2,058

(2,949

)

1,924

3,905

-

(4,942

)

Benefit from income taxes(333

)

-

-

-

-

-

333

-

Net loss$

(30,130

)

$

20,583

$

2,058

$

(2,949

)

$

1,924

$

3,905

$

(333

)

$

(4,942

)

Net loss per share attributable to commonstockholders, basic and diluted (1)$

(0.37

)

$

(0.06

)

Weighted-average number of common sharesused to compute net loss per shareattributable to common stockholders,basic and diluted80,868

80,868

(1) GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.37

)

Stock-based compensation expense0.25

Employer payroll taxes related to stock-based compensation expense0.03

Deferred costs (amortization of deferred costs)(0.04

)

Depreciation and amortization expense0.02

Amortization of debt discount and issuance costs0.05

Income tax associated with 2025 Notes-

Non-GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.06

)

BILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATASIX MONTHS ENDED DECEMBER 31, 2020(Unaudited, in thousands except percentages and per share amounts) Employer payroll Deferred Depreciation Amortization Income tax Stock-based taxes costs and of debt associated GAAP compensation related to (amortization amortization discount and with 2025 Non-GAAP expense stock-based of deferred expense issuance Notes compensation costs) costs expenseTotal revenue $ 100,254 $ - $ - $ - $ - $ - $ - $ 100,254

Cost of revenue 26,079 (1,243 ) (143 ) (285 ) (1,557 ) - - 22,851

Gross profit 74,175 1,243 143 285 1,557 - - 77,403

Gross margin 74.0 % 1.2 % 0.1 % 0.3 % 1.6 % 0.0 % 0.0 % 77.2 %

Operating expensesResearch and 38,272 (6,315 ) (574 ) 2,048 (99 ) - - 33,332 developmentSales and 27,082 (3,375 ) (303 ) 1,186 (59 ) - - 24,531 marketingGeneral and 36,773 (9,650 ) (1,038 ) - (209 ) - - 25,876 administrativeLoss from (27,952 ) 20,583 2,058 (2,949 ) 1,924 - - (6,336 )operationsOther (expense) (2,511 ) - - - - 3,905 - 1,394 income, netLoss before (30,463 ) 20,583 2,058 (2,949 ) 1,924 3,905 - (4,942 )benefit fromincome taxesBenefit from (333 ) - - - - - 333 - income taxesNet loss $ (30,130 ) $ 20,583 $ 2,058 $ (2,949 ) $ 1,924 $ 3,905 $ (333 ) $ (4,942 )

Net loss per shareattributable tocommon $ (0.37 ) $ (0.06 )stockholders,basic and diluted^(1) Weighted-averagenumber of commonsharesused to compute 80,868 80,868 net loss per shareattributable tocommonstockholders,basic and diluted ^(1) GAAP net loss per share attributable to common stockholders, basic and $ (0.37 )dilutedStock-based compensation expense 0.25

Employer payroll taxes related to stock-based compensation expense 0.03

Deferred costs (amortization of deferred costs) (0.04 )

Depreciation and amortization expense 0.02

Amortization of debt discount and issuance costs 0.05

Income tax associated with 2025 Notes -

Non-GAAP net loss per share attributable to common stockholders, basic and $ (0.06 )dilutedBILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATASIX MONTHS ENDED DECEMBER 31, 2019(Unaudited, in thousands except percentages and per share amounts)GAAPStock-basedcompensationexpenseDeferredcosts(amortizationof deferredcosts)DepreciationandamortizationexpenseLoss onrevaluation ofwarrantliabilityNon-GAAPTotal revenue$

74,260

$

-

$

-

$

-

$

-

$

74,260

Cost of revenue18,934

(359

)

(399

)

(1,571

)

-

16,605

Gross profit55,326

359

399

1,571

-

57,655

Gross margin74.5

%

0.5

%

0.5

%

2.1

%

0.0

%

77.6

%

Operating expensesResearch and development24,507

(1,755

)

371

(198

)

-

22,925

Sales and marketing21,758

(877

)

1,285

(143

)

-

22,023

General and administrative23,283

(2,360

)

-

(193

)

-

20,730

Loss from operations(14,222

)

5,351

(1,257

)

2,105

-

(8,023

)

Other income, net999

-

-

-

717

1,716

Loss before provision for income taxes(13,223

)

5,351

(1,257

)

2,105

717

(6,307

)

Provision for income taxes51

-

-

-

-

51

Net loss$

(13,274

)

$

5,351

$

(1,257

)

$

2,105

$

717

$

(6,358

)

Net loss per share attributable to commonstockholders, basic and diluted (1)$

(0.87

)

$

(0.10

)

Weighted-average number of common sharesused to compute net loss per shareattributable to common stockholders,basic and diluted (2)15,268

61,718

(1) GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.87

)

Stock-based compensation expense0.35

Deferred costs (amortization of deferred costs)(0.08

)

Depreciation and amortization expense0.14

Loss on revaluation of warrant liability0.04

Impact of the assumed conversion of redeemable convertible preferred stock0.32

Non-GAAP net loss per share attributable to common stockholders, basic and diluted$

(0.10

)

(2) Shares used to compute GAAP net loss per share attributable to common stockholders, basic and diluted15,268

Weighted average effect of the assumed conversion of redeemable convertible preferred stock from the date of issuance46,450

Shares used to compute non-GAAP net loss per share attributable to common stockholders, basic and diluted61,718

BILL.COM HOLDINGS, INC.RECONCILIATION OF GAAP TO NON-GAAP DATASIX MONTHS ENDED DECEMBER 31, 2019(Unaudited, in thousands except percentages and per share amounts) Deferred Depreciation Loss on Stock-based costs and revaluation GAAP compensation (amortization amortization of Non-GAAP expense of deferred expense warrant costs) liabilityTotal revenue $ 74,260 $ - $ - $ - $ - $ 74,260

Cost of revenue 18,934 (359 ) (399 ) (1,571 ) - 16,605

Gross profit 55,326 359 399 1,571 - 57,655

Gross margin 74.5 % 0.5 % 0.5 % 2.1 % 0.0 % 77.6 %

Operating expensesResearch and development 24,507 (1,755 ) 371 (198 ) - 22,925

Sales and marketing 21,758 (877 ) 1,285 (143 ) - 22,023

General and administrative 23,283 (2,360 ) - (193 ) - 20,730

Loss from operations (14,222 ) 5,351 (1,257 ) 2,105 - (8,023 )

Other income, net 999 - - - 717 1,716

Loss before provision for (13,223 ) 5,351 (1,257 ) 2,105 717 (6,307 )income taxesProvision for income taxes 51 - - - - 51

Net loss $ (13,274 ) $ 5,351 $ (1,257 ) $ 2,105 $ 717 $ (6,358 )

Net loss per share attributableto common $ (0.87 ) $ (0.10 )stockholders, basic and diluted^(1) Weighted-average number ofcommon sharesused to compute net loss per 15,268 61,718 shareattributable to commonstockholders,basic and diluted ^(2) ^(1) GAAP net loss per share attributable to common stockholders, basic and $ (0.87 )dilutedStock-based compensation expense 0.35

Deferred costs (amortization of deferred costs) (0.08 )

Depreciation and amortization expense 0.14

Loss on revaluation of warrant liability 0.04

Impact of the assumed conversion of redeemable convertible preferred stock 0.32

Non-GAAP net loss per share attributable to common stockholders, basic $ (0.10 )and diluted ^(2) Shares used to compute GAAP net loss per share attributable to common 15,268 stockholders, basic and dilutedWeighted average effect of the assumed conversion of redeemable convertible 46,450 preferred stock from the date of issuanceShares used to compute non-GAAP net loss per share attributable to common 61,718 stockholders, basic and diluted BILL.COM HOLDINGS, INC.FREE CASH FLOW(Unaudited, in thousands)Three months ended December 31,

Six months ended December 31,

2020

2019

2020

2019

Net cash used in operating activities$

(9,227

)

$

(1,769

)

$

(11,583

)

$

(4,149

)

Purchases of property and equipment(7,742

)

(1,026

)

(13,636

)

(2,972

)

Capitalization of internal-use software costs(346

)

(125

)

(660

)

(340

)

Free cash flow$

(17,315

)

$

(2,920

)

$

(25,879

)

$

(7,461

)

BILL.COM HOLDINGS, INC.FREE CASH FLOW(Unaudited, in thousands) Three months ended Six months ended December 31, December 31,

2020 2019 2020 2019

Net cash used in operating $ (9,227 ) $ (1,769 ) $ (11,583 ) $ (4,149 )activitiesPurchases of property and (7,742 ) (1,026 ) (13,636 ) (2,972 )equipmentCapitalization of (346 ) (125 ) (660 ) (340 )internal-use softwarecostsFree cash flow $ (17,315 ) $ (2,920 ) $ (25,879 ) $ (7,461 )

BILL.COM HOLDINGS, INC.REMAINING PERFORMANCE OBLIGATIONS WITH FINANCIAL INSTITUTIONS(Unaudited, in thousands)December 31,

June 30,

2020

2020

Remaining performance obligations with financial institutionsto be recognized as revenue:Within 1 year$

17,803

$

13,001

Thereafter130,908

139,334

Total$

148,711

$

152,335

View source version on businesswire.com: https://www.businesswire.com/news/home/20210204005987/en/

CONTACT: IR Contact: Karen Sansot ksansot@hq.bill.com Press Contact: Oriana Branon obrannon@hq.bill.com 619-997-0299