Bill.com Counts On Partnerships Amid Covid (NYSE:BILL)

Via SeekingAlpha.com

Bill.com (NYSE:BILL) went public in December last year. In spite of the recent market turbulence and the global economic conditions, its stock has had a strong run. Since listing, the company’s stock has soared almost 220%.

Bill.com’s Financials

Bill.com recently announced its third quarter financials. Third quarter revenue grew 46% to $41.2 million, significantly ahead of estimates of $36.83 million. GAAP net loss was $8.3 million, compared to net loss of $2 million a year ago. On an adjusted basis, net loss was $2.9 million, or $0.04 per share, compared with a net loss of $138,000 last year or a breakeven quarter reported a year ago. The market was looking for a loss of $0.10 per share for the quarter.

By segment, subscription and transaction revenues grew 63% to $36.1 million. Interest on funds held for customers, referred to as float revenue, fell 16% to $5.1 million.

Among key metrics, it reported a customer growth of 28% over the year to over 91,000. It processed $24.2 billion in total payment volume, growing 35% over the year. The number of transactions processed grew 23% to over 6 million.

Bill.com expects to end the current quarter with revenues of $37.4-$38.4 million with an adjusted loss of $0.12-$0.11 per share.

Bill.com’s Covid Impact

While the global crisis is hitting most companies, Bill.com believes that it is in a strong position overall. Its platform provides its customers the ability to monitor their finances closely and react quickly. Since most SMBs still relied on paper-based manual processes, the current remote working conditions have nudged them to accelerate the transition to digital financial operations.

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In terms of resiliency, it is not very concerned given that its demand generation is not reliant on in-person events like annual user conferences. It markets its platform directly to SMBs through online digital marketing referral programs and strategic partnerships. Its go-to-market model is not reliant upon feet on the street as its direct sales motion is 100% inside sales. Its offering of risk-free trial makes it easy for customers to get onboard the platform quickly anytime, anywhere from any device.

Bill.com also realizes the importance of expanding its partnerships. It was already integrated with large financial institutions such as the Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM), and American Express (NYSE:AXP). Recently it announced a new agreement with Wells Fargo (NYSE:WFC). As part of the partnership, Wells Fargo will power a new digital AP and AR solution for its treasury management clients by integrating Bill.com into its commercial electronic office online portal. The service will be launched later this year and is expected to help improve its offerings for small and mid-sized business AP and AR workflow solutions.

Last month, it also expanded its partnership with JPMorgan Chase. As part of the expansion, Chase’s virtual card offering is now integrated into Cashflow360. Cashflow360 is Chase’s digital platform for businesses and includes Bill.com. The integration will provide Chase customers with an alternative way to pay bills with faster delivery of payment, enhanced spending controls, and simplified reconciliation.

Its stock is currently trading at $69.37 with a market capitalization of $5 billion. It had fallen to a low of $23.61 in March this year. Bill.com had listed on the NYSE in December last year when it raised $216 million at an IPO price of $22 apiece and a valuation of $1.6 billion. Prior to listing, it had raised $279.7 million through venture rounds. Its last venture round had valued the organization at $1.1 billion.

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Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.