Bill.com edges closer to profitability, shares up 30%
Bill.com, a Californian cloud-based fintech which automates businesses’ bill payments, saw its shares jump more than 30% last week.
The spike followed the unveiling of its financial results for October to December 2020, which beat analysts’ predictions. Its losses were down to $2.7 million, compared with $4.5 million in the same quarter a year before.
The fintech went public at the end of 2019, carrying with it a loss of $7.3 million from June 2019 to June 2020. Despite being a loss-making firm, the company secured a valuation of $1.6 billion following its initial public offering (IPO).
Held up as an IPO success story by the industry for fellow loss-making fintechs, Bill.com seems to have kept up its momentum since. Priced at $22 a share back in December 2019, Bill.com’s stock price sat at $184.69 on Friday trade close.
Between October and December last year, revenue was up 38%, to $54 million. Wall Street analyst consensus forecasted a lesser $47.1 million.
And for the first time ever, its “core revenue” – which makes up the vast majority of its earnings, made up of subscription and transaction fees – surpassed $50 million.
Transaction fee growth was up 98% year-over-year. Whilst total payment volume surged 40% year-over-year to $35 billion, from $25 billion a year earlier. Total customers grew to 109,000, up 27% from 86,000 a year ago.
The fintech serves mid-market customers, having established integrations with Sage Intacct, Oracle NetSuite and Intuit’s QuickBooks Enterprise.
In the last year, it has been busy rolling out a number of new products, which are likely pitting confidence in investors who are keen to see Bill.com carve out a route to profitability.
“Over the last few years, we launched several faster payment offerings, including virtual card, cross-border payments and “Instant Transfer”, which is our real-time payment product,” Rene Lacerte, Bill.com’s CEO and founder, says on an earnings call reported by Motely Fool.
Currently, the fintech has developed white label offerings with three major US banks – JPMorgan Chase, Bank of America and Wells Fargo.
It also recently rolled out a platform for wealth management firms to offer bill pay functionality to clients.