BILL (US:BILL)2022-05-06 02:57Financial Data and Key Metrics Changes - Total revenue increased by 179% year-over-year, reaching $166.9 million [39] - Organic core revenue grew by 74% year-over-year, amounting to $102.1 million [39] - Non-GAAP gross margin was reported at 84.6%, exceeding expectations [42] - Non-GAAP net loss was $8.7 million, significantly better than anticipated [44] Business Line Data and Key Metrics Changes - Revenue from the Divvy spend management solution increased by 155% year-over-year [39] - Subscription revenue rose to $52.2 million, up 78% year-over-year [41] - Transaction revenue surged to $113.3 million, reflecting a 286% year-over-year increase [41] Market Data and Key Metrics Changes - Total payment volume processed on the platform reached $55 billion, representing a 57% year-over-year growth [37] - The number of Bill.com organic customers increased to 146,600, with 11,600 net new adds in the quarter [33] - The number of spending businesses using Divvy grew to 18,100, more than double from a year ago [35] Company Strategy and Development Direction - The company aims to build an integrated solution by combining Bill.com's AP platform with Divvy's spend management and Invoice2go's accounts receivable capabilities [10] - A focus on enhancing relationships with strategic partners, particularly in the accounting and financial institution sectors, is emphasized [13][15] - The company is scaling its organization to address a large global opportunity and aims to become a multibillion-dollar company [19] Management's Comments on Operating Environment and Future Outlook - Management noted that inflation has had a minimal impact on business operations, with customers seeking efficiency [28][66] - Rising interest rates are expected to provide a significant tailwind, potentially increasing float revenue by $30 million to $35 million annually for every 100 basis points increase [31] - The company anticipates continued strong growth in the upcoming quarters, with Q4 revenue expected to be between $182.3 million and $183.3 million [47] Other Important Information - The company has integrated employees from Divvy and Invoice2go into a unified team [10] - New leadership appointments include a Chief People Officer and a new Board member with extensive experience in the SMB sector [20][22] - The company is focused on enhancing its platform capabilities and expanding its payment offerings [48] Q&A Session Summary Question: What is driving the strong customer adds? - Management attributed the strong customer adds to a multichannel distribution strategy, particularly the partnership with Bank of America [52] Question: Can you explain the revenue model with financial institutions? - The revenue model involves minimum guarantees with financial institution partners, which take time to translate into revenue growth [53] Question: How is the rollout of Instant Transfer and enhanced ACH going? - Management highlighted the importance of these payment options for suppliers and their potential to enhance monetization [61] Question: Are customers delaying purchases due to inflation? - Management reported minimal impact from inflation, noting that businesses are looking for efficiency [66] Question: What are the competitive barriers in the market? - Management emphasized the large market opportunity and the company's robust platform as competitive advantages [77] Question: How does the company plan to maintain customer growth? - The company plans to leverage its multichannel strategy and enhance customer experience to drive growth [92] Question: What is the outlook for profitability as revenue scales? - Management expressed confidence in balancing growth with operational efficiency, aiming for minimal losses [95]