BILL - Earnings call transcript Q2 2022

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Operator

Good afternoon, and welcome to Bill.com's Second Quarter of Fiscal 2022 Earnings Conference Call. [Operator Instructions] With that, I would like to turn the call over to Karen Sansot, Vice President of Investor Relations, for introductory remarks. Karen?

Karen Sansot

Thank you, operator. Welcome to Bill.com's fiscal second quarter 2022 earnings conference call. press Form short X-K earnings furnished ago our related the to issued release time a and We the SEC. can website release section press be the on The Investor of our at investor.bill.com. found Relations Founder the call Executive Rene CEO John With me of and today and CFO. on Bill.com; President Lacerte, is Chairman, and Vice Rettig,

assumptions, make If of remember the implied operations about results by of our please begin, course those Bill.com we from or or statements involve during the uncertainties expressed statements. uncertainties. incorrect, differ of could if the future forward-looking results risks this these risks Before any or materially that actual call, any assumptions that many we and may developed and prove forward-looking of

measures. performance non-GAAP performance. respectively, and we stated which today's XXXX to acquired results, quarterly statements, on disclaim non-revenue exclude the press XX-K the press in to annual for filed InvoiceXgo, any Form which We this most refer statements. disclosures For filed update X, these and we our listeners Investor measures. a discussion that available understand stand-alone non-GAAP obligation release website. report issued of release GAAP GAAP with the on On with At our X, June and risk to Divvy times financial our SEC will GAAP today refer Please additional we forward-looking organic help the the discuss any or call, report unless section discussed our text financial organic please periodic Company's to factors to during refer will recent on call, and our the on forward-looking today The to reconciliation and and associated September regarding including Relations the financial of a today's are reports non-GAAP, SEC, figures Form number. measure is to and the with of both XX-Q

to Rene. turn call the Rene? I'll Now over

Rene Lacerte

doing you spend year-over-year. Thank quarter the uncertainty, I while quarter revenue ahead produced for grew of of growth time your everyone. revenue from We that all afternoon, increased core nearly management and Good Karen. ended In at the you an organic QX customer expectations. solution continued our exceptional hope perspective, breakeven earnings revenue year-over-year. marks Divvy and Bill.com's accelerating XX% a tripled fifth of platform XXX% unabated. today. our of from as joining you, consecutive for adoption Thank well. quarter of the us a year-over-year, healthy non-GAAP revenue Total are results. has core our well Bill.com families

are us requires revenue becoming breadth the We the well delivering of profitable, dollar to enhance operations. ecosystem. a expanding Achieving to continue this small on all-in-one midsized our also our platform to platform depth our and while way for multibillion go-to-market financial and business company, goal

of has new the Chief our happy a team of part role CEO Officer. single have Divvy, expansion, Murray, and sales am Co-Founder Blake under As this sales Revenue I announce that accepted we decided to our to as a leader. combine

will distribution benefit Blake qualified record track with uniquely company-wide, scale our selling be believe and across responsible efficiently to channels. driving of organization, helping As combined expansion. adoption, and diverse combined him entire this lead for innovating CRO experience of our SMBs, serve Blake's will makes company sales to I us the this

I'd his thank him his for the this be leaving Bill.com. Tom many change, and to endeavors. Clayton of like contributions future best wish to Bill.com part Tom in As will

scale. at a transform SMBs significant helping are We

a billion financial platform businesses SMBs. totaled second in $XX process champion manage the As QX, back to of businesses which more XXX,XXX quarter than their TPV. operations their the more of These trust is Bill.com and our were leveraging solutions simplify their automate end than of and to our payments, offices. in

business our small and reach I'm of of mission is is customers Bill.com, their America receivable solution are bank financial are Bill.com's visibility fun to calendar flow, for discussed With that connect as excited proprietors make transforming the inefficient, by extends was encumbered Bank of in that their markets Today, SMBs rollout serves. The sole that and control earnings a work year back-office will America's the it several on calls, came of top In of together platform U.S. part Bank throughout the up including payables for processes America. time-consuming. the success one them these in business. solution share banks new to opaque businesses, rewarding small serving SMBs cash Our are their the to and new and partnership and get do our result three design digital to in still new operations. prior and businesses. more of to of commercial the manual selected to being and growing serves Most simple businesses, we continue a launched all freeing QX, nationwide support a accelerant This as XXXX. Bank

with in delighted inside which self-service, The opportunity manner. diverse partnerships, strategic for transformative of go-to-market and to mission-critical our of the about our an sales includes brings extension are power growth direct Bill.com. our SMBs platform a efficient makes tool and tremendous We our ecosystem, this accountants. This fuels Bill.com reach together

XX members. six X,XXX Broth, has diversity XX since hours the reach channels. and nourishing bone of was more strategy sold a me top sales broth take five company my X.X Ohio-based with Bones Harvey, U.S. XXX us great the to week I has than top co-founders, and distribution that the breadth firms, stacks out commercial and enabled expand generating than quote, We more all whole Bill.com, and just millions working to to used have XX network XXXX, Ryan and across a customers is an in shipping our million said in example. their it than managing accounting our partnerships more from Bare "Before XX financial and institutions of The to a kitchen have grown business of Katherine more including small the of Harvey to revenue of states job, Katherine paper. payables and

a Now me and five focusing it hours enables more week, spend time which distribution. sales on me takes to

With for I been the to. my grow business passion we sales time and able have find was to to able would our I saved, a level never

more complete A have more payables. on customers and to clients. are of really growth firm New more our Soccer manual soccer Our and Bill.com is automate the SMB-focused an Bill.com clubs Manhattan business time managing services. also and peace process approximately AP having scaling operations, York digitize Matt X,XXX our reimbursement drives accounting of We to our I is is their businesses accounting Club XX using relies Bill.com. "With the are cards the who their a clients time-consuming. They food recurring to strategic Arnoff, and for on for Manager, and recently mission that hiline and firms creates process, to heal." while and Bill.com, CEO firms, transform and management largest clients. on example teams Accounting quote, checks more initiatives Soccer paper Gardner, alleviates the hiline. are spend is for financial over invoices, save City. to helps to the "Divvy been able one using partners has can their and solution. focus accounting is and mind." on General solution to for time This ability tech-enabled their our saving Divvy, give now Manhattan personal said body reimbursement to office. and focus team reducing clients' expenses, focus for that high-value also the back in adopted comprehensive two-thirds Co-Founder, able also I process creating quote, asking great frustration. create it uses on transform time which provide of for us and time spent With An more the said hiline, players why more we value financial They more our example return-related Samuel their

that adds each bill and integration ease having into count transaction, on seamless. QuickBooks is and visibility can also Bill.com real-time the solutions for I have multiple also place value with for I of one pay in Additionally, The me. the building Manhattan the introduced a teams solutions. sign-on and single Bill.com Recognizing consistent unified features both and more Soccer Club need are that Divvy articulated, simple, Recently, throughout we our product navigation enable management." expense experience. platform

We the to speed also customers sign approval made easy process. Bill.com up it and for credit Divvy for line up

transformation digital businesses. the for in early stages are We of

us. introducing have of pace our to and ahead strong of meet capture tremendous opportunities we are record demand, the customer track new services We a accelerating innovation of to

For continue customers to payment our choices. we give solutions example, that test more

enhanced payments experience paid. capabilities InvoiceXgo's customers payables in-platform enables product cards. Card By an Pay Recently, also to via for their credit new we with branded fund getting Our payment

funds view the their Now rather InvoiceXgo give topic funds Divvy receive to intermediary. makes solution, A expense an reduces availability. recently and speeds sign-up directly improvements easier, up designed of launched we an of friction than a branded the Continuing customers on of innovation, host to through our payments can experience management. customers end-to-end

categorization businesses of free via can auto to employees and Now matched ACH. receipt, reimbursements spending expense receive e-mail which card transactions to better get

owners In to upgraded flow the addition, enhanced we provide cash budget Divvy dashboard insights.

a priority In more be Looking remains businesses we the sole to proprietors ahead, support the bullish to ranging from continue features and unified have it companies. seamless that experience. to mid-market deliver about our create opportunity I to platform near-term,

via LinkedIn. brings an both and diverse from continue our brands at possible her the will future Acton brand-building and part a our and institutions. efforts our ecosystem in scale will to people play Sarah experience also as and growth. Sarah consumer marketing our welcomed She business this and bringing Officer. None QX, markets. expand accounting great our global we financial relationships years leadership of brand has offerings, extend Chief growing across talent In network Sarah our is of built across our accelerate Yahoo! in wealth and We without company. our firms payment and and Marketing important leading reach with

quarter her we to for through Bill.com and moat to great I commitment we've growth widen team. In to want mission, We our built are results customers very the each to we thrilled their on product go-to-market driving continue these the innovations. delivered financial strategies our strong employees closing, and have and for this other. X,XXX our as thank

to more talk to quarter. the amazing Now our in call turn about John detail let over me

John Rettig

Rene. fiscal for our I'll Thanks, fiscal full the quarter overview and results provide third XXXX. second and Today, year fiscal our financial quarter of XXXX discuss outlook an

for a and second financial InvoiceXgo quarter As Both from today's are results. GAAP comparable release reminder, in tables measure. Please Divvy non-GAAP financial directly measures. includes earnings reconciliation press our most a to in the the our discussion non-GAAP included refer to

of XX% exceeded growth across non-GAAP of of Our QX year-over-year, non-GAAP total a basis. core gross expectations growth margin results year-over-year, on revenue breakeven our EPS board with revenue and XXX% organic XX%, the

We strong continue to stand-alone see revenue XXX% very including Divvy's growth organic year-over-year. of results,

progress while the efficiently engaged energized new growth business. quickly creating adoption leverage. large revenue SMBs, build time, are ecosystem, create base enable same additional products. members network and our and go-to-market strong And at our can the delivering We us to With our for by of R&D our growth and value across we operating of customers, scale investments levers

to Turning key on metrics. update an our

of customer We our quarter customers recent the organic across adoption Divvy fiscal quarter, X,XXX was strong metrics insights new channels. customers, including all second on Bill.com, driven by acquisitions, Bill.com Given Customer XXX,XXX with providing are acquisition ended InvoiceXgo. across in during Bill.com. and we additional QX for net our organic strong the

Bill.com's We Divvy organic underwriting risk customers end expected and seasonal their trends proprietary sequential December Organic the in in $XX and slight significantly customers and trends XX,XXX year-over-year customer going criteria of subscribers volume representing billion, growth. strong InvoiceXgo the We as using to flows. believe We to exhibited XX% as AR new our forward. as QX. will delivered businesses growth onboarding logic quarter. and QX in outperformed the of similar strong also of TPV XXXX at higher-value payment very decline solution more of had quarterly yield The observed XX% new InvoiceXgo's this expectations added and total application applied Divvy our net XXX,XXX sign-up robust we using spending

share Our customer. has the quarters of more and organic payment slightly choices expansion TPV and been larger growth customers in of by wallet a engagement driven impact from given recent average our and

January fiscal the typically we to slightly into experience SMBs tax many seasonality planning spend TPV December for down compared third ahead, the because Looking pull from QX quarter year-end with some in quarter, purposes.

processed year. quarter, transactions businesses $X.X increase in card spend billion which Divvy from last During the is solution, from of using XXX% we spending our an management

Bill.com the of in year-over-year platform We number payments growth. million the X.X to on Moving processed transactions. QX, on reflecting XX%

Divvy We million also processed X.X card transactions.

Total year-over-year. Bill.com growth up growth our and subscription $XXX.X was revenue, XX% results. million, I'll year-over-year growth fees, million, transaction consists compared of XX% XXX% to reported $XXX.X Now core to of representing Core was XXX% which revenue Organic review last quarter. QX revenue year-over-year. consolidated accelerated

accelerating As believe fiscal marked the Rene of fifth create revenue value speaks to annual QX the we row customers. core noted, in growth, a which we quarter for

strength, addition strong were Divvy's XX% year-over-year. up grew the prior card processed basis results In our Subscription take the quarter. revenue our by through from $XX.X XXX% was spend revenue points than to more increased core organic year-over-year. card partners seasonally in revenue management approximately spend million, rate expansion in to higher-yielding XXX solution driven quarter to as and spend

the InvoiceXgo quarter. inclusion In addition our for growing full subscription to by base, was driven a subscribers of customer revenue

growth subscription from relating of was InvoiceXgo accounting recognizing of new up XXXX-XX in quarter. valorem our the the resulted began XXX% QX new America growth XXXX. larger approximately in to of QX, of Together, to Bill.com QX, growth slightly in revenue also $XX increased result last significant subscription annual Float revenue from a FASB accounting. small balances. mainly step-up strong adoption revenue the represented ad increased subscription acquisition ASU by year-over-year, XX% in by as our FBO approximately compared million, in Bank XXX% acquisition increased previously Transaction which and October XX% revenue of part revenue FASB size usage and written in impact management due of for were the accelerated revenue down totaled $XXX.X from was to solution, prior revenue, adopted card early of organic solution which increase issued these $XX.X to $XXX,XXX deferred products revenue million driven an Bill.com also In contracts revenue from QX. America. was growth, was with million that year-over-year. in a recognizing year-over-year average the transaction $X which as organic business items of customer in for Bank quarter, a TPV This our revenue. We QX, million of spend our we

the expect material short-term, out, not further given in opportunity an do we rising environment. ahead, Looking accelerating in but rate for there growth growth float revenue the is interest

Non-GAAP was InvoiceXgo from mix gross margin quarter, XX.X%, higher operating results and revenue. valorem driven our and last gross for Turning to QX. of benefit ad a the revenue up transaction margin deferred XX.X% by

the In in costs to resulting improved addition, our our routing non-GAAP providers, gross payments. margin for between due exchange FX conversion the impact of cross-border lower optimizing foreign

increased due Sales due were of expect solution. million, InvoiceXgo expense $XX rates with fraud the capabilities. our platform's of a for XX%. in our R&D rewards loss associated of to as QX, increased and with credit the from and G&A cross-sell with expenses million to non-GAAP $X remainder operating range million payment the expenses estimated InvoiceXgo trends. increased spend million and quarter and full the we and our $X.X For reflecting QX the to in XX% continue be gross with associated inclusion and management spend increased increased QX losses growth historical to from margin fiscal from XXXX, card $XX.X $XXX.X go-to-market consistent TPV increase being quarter million Non-GAAP our full primarily efforts, of expenses of in from increased QX. an investing we marketing workflow the

QX, based profit loss a we net $X.X or shares on loss a non-GAAP weighted breakeven net basic was million, XXX.X $XXX,XXX per and delivered operating share outstanding. our For million of non-GAAP

the due non-GAAP our expectations, profit were the to net during significantly recognized operating loss both than revenue subscription and better quarter. breakeven part in additional non-GAAP Our

the the Now short-term billion, cash moving on and $X.X Cash, to investments sheet. flat equivalents quarter-over-quarter. of balance at end were QX

to We business. to enabling continue scaling us be well our in capitalized, invest

of of longer the TPV increase from well we the XX, slightly which processed QX to billion balance customer XX% was check As as in due transit funds $X.X December during or our in million had times. end we on as $XXX up sheet, QX significant

year the fiscal full financial and moving to fiscal for quarter third our Now on outlook XXXX.

one recent SMB though the transitioned business, Divvy never excited on opportunity position. been we and organic acquisitions purposes. providing revenue InvoiceXgo, are the With We've have consolidated managing pursuing we information market expectations for about we're growth large more to already additional comparability of leadership and our global

Our results have have we financial SMBs clearly results. and demonstrated momentum value the significant creating for driving

being the Looking supply There businesses. impact and inflation at of chain macro is by the uncertainty constraints regarding environment. experienced Omicron,

we While an the on at see to continue monitor the don't we our moment, closely. overall impact situation base SMB

impact be there issues to by XXXX from our won't supply our or negative pandemic Our faced chain fiscal update a material assumes outlook customers. business macroeconomic

For that in $XXX growth that in expect QX the QX QX. the total our and fiscal America year-over-year million additive Both sequential be and of influenced be our as to to fees. InvoiceXgo we referenced growth will these results by in as in QX, are Note subscription of in range contribute revenue to seasonality I million. revenue Bank full-year $XXX earlier to well revenue recognized items for and QX step-up

For previously of QX, management expected while XXX be to revenue discussed. and to Bill.com is QX closer card the spend XXX lower be take growth top seasonal in to core end an stand-alone estimated travel categories on organic points basis, XX% approximately spend expected a advertising rate is reflects Divvy's the for which XXX%, the to approximately revenue growth annual and basis

a give early higher-yielding March in fiscal in securities to on increase expect perspective, we interest $XX lag timing if that a XXX translate interest carries Note which beginning rising revenue will our short-term float rate do rates revenue reinvest but funds become be not rates rates, expect high margins. million while will million with XXXX. tailwind as was basis We there annual you to impact as float points To float very increase the overall maturing to would approximately model. Over material will interest as some securities. federal this today, higher our we into $XX time, expect revenue, of a

expect bringing the partners terms integration products scaling R&D to financial payment strategic continue platform making In operating Divvy activities expenses, InvoiceXgo, to of we market. and we're with institution with and in investments new for

we expect investments. regarding being continue and vigilant addition, marketing to our In sales

million for to $XX.X $XX.X On QX, line, net count basic per loss bottom of share range share a $X.XX of loss the expect of XXX.X the shares report a to a $X.XX based on to outstanding. non-GAAP weighted million non-GAAP we in million and

outlook fiscal Moving to for our XXXX.

We expect range total InvoiceXgo. $XXX $XXX fiscal XXXX, growth. our stand-alone annual XX% to growth of million, estimate This Bill.com $XX approximately million revenue to from of the or in assumes be from organic revenue with up core annual XX% million previous in of approximately

Divvy, growth revenue For for XXX% fiscal our last of quarter. XXX% expect with versus annual of we estimate guidance XXXX

fiscal we of weighted report count on for $X.XX range a line, to to basic $X.XX shares expect a non-GAAP $XX.X outstanding. non-GAAP XXX.X the per $XX.X of million based On loss net of share bottom XXXX, loss share million the to in and a million

track future. record us grow, and creating unit the enable of scale we creating economics a operating strong efficiency that have in We are to leverage continue our confident as we and will

empower us business. in high unit Our growth strong economics to our and invest

of ranging to decade, have leading helps For companies. from we platform thousands over build midsized hundreds of financial entities, to businesses smallest of operations worked a the the that

we a a invested record innings turning results. opportunity. track have consistently the still believe these new of have into SMBs, same in for large strong tangible we we're ways to of market investments value We and early At the in time, create

reality to and offers SMBs scale that new rapidly work platform proposition future. Our to back Karen? a stay. growing uniquely are the With value fast for financial facto their is increasingly differentiated SMBs the I'll that our of call here become to now the now we the and pace hand offices Karen. given innovations, of De are positioned hybrid platform manage to back in recognizing

Karen Sansot

John. Thanks,

that Q&A, request for limit one we just you up yourself opening Before to question.

get to everyone enough have today. to time we the on So call

Thanks. queue. have back ready we follow-up question, we in the you you that are jump Operator, If now a for ask questions.

Operator

from comes Brent today question Piper Sandler. Brent, please ahead. go from first Our Bracelin Instructions] [Operator

Brent Bracelin

Thanks one to in here question super for obviously, taking the for – the the John, Rene, the organically acceleration and acquisitions. question question My here. business impressive Rene. see both

One reach. of of the aspects is the global InvoiceXgo the business more interesting

Some suggest downloads our application of data the of are half from that coming international.

maybe a aspirations AR little your a about So how bit in brings, product bit expand the that hear I relative about little fits InvoiceXgo? to globally. more I could global you your love would strategy, talk to but capabilities appreciate it to

Rene Lacerte

you. serving reach over was business the Brent. the the Thank good definitely of U.S. acquisition those for of XX% they're has, XXX they in reason from the you, And obviously, international customers the the customer Always InvoiceXgo that in hear Part to both have countries aspect the business the is and of all countries. with

aspirations, So It delivering global that through the started the process we And focused the product and think ability we've and in do the because Bill as that payments workforce customers countries. payments is international out attractive cross-border those U.S. everywhere. with to are fact very SMBs was the they have and international we also have for core folks about was value presence are there. very our for the And that those suppliers in the us. both on way they attractive Sydney that international the to the and of other

to to going of with with leverage rails they And have, so experience simplicity software simplicity all when payment the opportunity leverage InvoiceXgo that to in have. is we that market the to the the and think Bill.com in capabilities that respect and product, we

excited forward to as about it and we're to continue application. we the integrate that look extending So reach

Brent Bracelin

great. you. Sounds Thank

Rene Lacerte

you. Thank

Operator

Our next question Berg ahead. from Company. & please comes Scott, Scott from Needham go

Joshua Reilly

Congrats Scott. strong on Hey, guys. quarter. Josh the is for This on

hit had to as source know growth of that Bank Any that quarter. it the of there. contributor as there figure was a be more the So ever model material color think maybe I How additions, customer that channel? a you Was strength was your mentioned well? broad-based would by company. America mentioned then net to public this you relationship, we began quarter it And the that should helpful. of best you about

Rene Lacerte

particular, an the say done Thank are quarter, lot work the accountant our but the excited channels. We the years, satisfied have top the all of great over – the very of you, had across A the we quarter progress – about we channel. in over Josh. exceptional and over now I very XX would was with obviously, XXX. of

have is firms We country. the And wealth across accountants of often working over that management, for us. all We X,XXX now well of the aspect launched serve. the which

So launched through that coming starting out and was to will end the definitely rolled call drive the that out XXXX, worth FY we mentioning rolling of expect be in and is calendar quarters. Bank that, that the was at more will that results a or meaningful to that out point. By quarter, strong be America market in driver. just of – With respect started and to it we opportunity, the

John Rettig

new Yes. America it's I adds. of have to really pleased the our fiscal And that, just we that Bank the add noting And rollout the Rene, net progress throughout scaling XXXX. of will worth we look with as be with rest ahead, we're

X,XXX, So point, most be closer but of quarter progress. discussed a range with new the maybe there at going this X,XXX to above recent forward to in adds quarter. the But pleased net had significant do the we're that really the we'll of the than to we contribution isn't previously X,XXX we expect X,XXX, last

Joshua Reilly

bit process in pruning Was Is sequentially. And customers? the with a there curious mentioned by there Great. way? I some of adding a you or – the – Okay. that then was dynamic impacted declining of on that X,XXX InvoiceXgo just

Rene Lacerte

of the We're – to Josh. that get queue. to through all take Hey, and analysts going the back all put be We the in you kind able today. want to

to but that that, we'll about if sorry there's get So time, question.

Operator

comes Autonomous Research. from please Ken go Ken, next Our Suchoski from ahead. question

Kenneth Suchoski

Hey, Rene I'll to John. one. question. for taking Thanks the and keep it

Balance to new mentioned Bill.com of to products and You both By market, bring launch continuing great invest during the it's Pay see Card the to quarter. payment to and

over well some potential products So of sense some can as you both? you about of open the how revenue segue unit In down economics as these sort time and particular, opportunities we think Or finance? monetization penetration framework Balance a of some provide for should Venmo model of you are BXB Bill.com of into kind Is line? for for it what capital does working up creating payments? the the

Rene Lacerte

Thank you, Ken.

on always operations building the solutions somebody – We we've financial to their operations. opportunity worked solution part focused enables when have de has. been to those offer the say, that wants would facto great payments. a software and us a to go-to really hard become, the that us software of platform business automate And And simplify I gives having

times. something so having or the asking And our products is By serve that we payments Card, we focus different look and And sure is really at making solutions on our want. and all when they customers Balance different customers this payments that that at for Pay Bill.com are for, different reasons

continuing drives continue marketplace is there's SMBs. I opportunities economics we'll to a continue so really that. say for that to go, to far do as lots to And financial adoption in create we're ways what us and the solutions, about solution the at that And would point, excited helps our this with drive of as

Kenneth Suchoski

much. very you Thank Okay.

Rene Lacerte

you. Thank

Operator

question please from ahead. go Peller Research. Wolfe Darrin, comes next from Our Darrin

Darrin Peller

on maybe then in Thanks, potential? are profitability. cross-selling path consolidation are hopes relative you And to InvoiceXgo? being your this the Great on investments these of print. have job about where Can guys. your to integrate you you and talk just And a employed note, now for in assets just Divvy longer-term to between related you where Bill and

call. earlier in the out called You

the much rate coming how be is sense run at full what guys. could of investment of and a Just more Thanks, opportunity integrated assets?

Rene Lacerte

we've user about us that the with experiences, credit integration we single the about We got done really similar feel for We've talked product to the integration you, ability streamline to Thank the the Darrin. approval process that date. the call, good applications. in Divvy sign-on,

we've just on work that InvoiceXgo. We started have of lots

September As quarter. a closed in reminder, InvoiceXgo the

behind on quarter a from speak to the the it's Divvy integration, So so experience.

using And both from of the and been gave we And examples see Bill.com, Club and have is we're so they're getting and Manhattan the value. delivering we great Soccer experience, starting focused what Divvy, call are customers some the on it. in what that to really

that get to you as we assertive, that's more experience going when capabilities. whether so integration, we And if directly and market, that's become in the with will, the market comfortable our using in product will or

the it makes So everything feel we're of combined good we company, of cross-sell and in in script be the think that of the that the about you all we're come integration, announcement Murray company the And front do with thinking opportunity and we the to having top the get the CRO included us. I to we're about about across where the quarters. in coming at we're good really be feel of that entities. just And in the three Blake about we what organizational see excited doing, how us to across with kind speaks

Darrin Peller

That's guys. Thanks great.

Rene Lacerte

Thank you.

Operator

line now question next your BofA Brad from comes Our Securities. Sills from Brad, is open.

Bradley Sills

Thanks, Great. here. guys. quarter to about InvoiceXgo. ask a I strong real Congratulations wanted on

What's that you over expectation capitalize said You is for receivables that really that integration conversion effect great and to to your number. When which those could InvoiceXgo time? XXX,XXX start then opportunity those? with you subscribers, payables customers we a the flywheel see upgrade in customers to to coming of on of expect convert should such that

Rene Lacerte

Brad. Thank you,

of of about a side excitement We AR AP our across InvoiceXgo and both the the platform business. lot have

a receivables, we customers payables network customer. have reminder, receiving are our from a those Predominantly, in some money members As X.X million platform.

and AR our includes the success drive so both AP platform to opportunities. us opportunity And for across

here So the our the AR InvoiceXgo payables And just I capabilities real. real. opportunity integrate base folks the opportunity focused payments to of that also on. do in the to the we've that seamless But remind experience and the payment with we announced to want cross-sell there InvoiceXgo has across is for We have also that invoicing, that's a InvoiceXgo cross-sell something with is that beginning opportunity into integration script a been customers. is ultimately, and

all this some something be and we So we about the business drive continue for our will of and customers. success to is that excited know

Bradley Sills

Thanks, Rene.

Rene Lacerte

Brad. you, Thank

Operator

ahead. from Will now We Nance go Sachs. Goldman to go Will, please

William Nance

terms help put channel questions. that I'm for taking and follow-up a on in of others' on adds you into the context could context, Thanks today, if that once guys. congrats quarterly maybe Hey for meaningful Bank what basis? contributes of to America. wanted I how echo FI nice on could the net customer a acquisition, quarter. wondering fully partnership be ramped the the of the with I'll in

Rene Lacerte

America one three Bank in of of is top Thank country. obviously you, the the Will. banks

from support so have, their an the super opportunity business. we're us scale they're reach SMBs, for to businesses the to about excited And they have, reach expanding opportunity their the growing, they as

serve we can support it's bank to us, FI of opportunity our FI and to the example is chosen so the their needs, and focused discussion America an that around to our some white-labeled and needs It interest as on products our based ability kind ability we Bank of and to those commercial have. And just that's partners, largest that having we've of strategy. a make smallest cross-sell And is for that as perfect experience. It's And opportunity our off of started are. reflective understand we businesses. success strategy then understand they customers, And overall their other there this businesses the is sure have. services an those of what kind that. got on relationship a And

to before, for have the that leverage look really financial around opportunity operations do us, they've the to software something which automate that of. really never to overall payments a financial is the so had be then they at an all drive to that part customers want for is They serve supporting it the businesses, when their institutions. And FIs, trust, and opportunity, we

So in super America to and opportunity Bank we practice. of that with the our leads are excited what FI about

Operator

from question next Bryan Keane ahead. Bank. go Deutsche Bryan, please from Our comes

Bryan Keane

transaction Hi, total, I John, beat acquisitions. includes both kind which to of in that estimates our Congrats. yield and organically maybe about wanted guys. ask,

out on you had call think I Divvy. a

Just thinking rate? Thanks. about the transaction seemed there moving like for it pieces solid take it a was because

John Rettig

transaction question. revenue, our Great progress $X, to making XX% for of really that customers, adoption contributing in with the our just these the price year-over-year. products up revenue ones transaction, expansion below per little was Sure. happy particular, driving a valorem we're we're of which And of $X.XX, products ad are

with spend with take where rate was expecting quarter-to-quarter were XX basis there based great then management results so particularly basis, product well, quarter, organic spend a expansion. the we rate the little other an on ad the above that range in take mentioned in You some the as on results Divvy categories. above And had bit points, the significant good

grow And from be there's our really to of organic able going adoption about products, making. feel see adoption drive to our go to we to rate that can we and So and continue we're business, newer of our take expect good long way progress the as you still continue forward. a as some we to

Bryan Keane

the for color. Thanks Great.

John Rettig

Sure.

Operator

from comes question ahead. Beck please go next Our from KBCM. Josh Josh,

Josh Beck

wanted ask to to the in Thanks It's well. sounds for a to time Transfer. product. What early to seat. exciting congrats say know Instant was Blake about an It it's question as like very taking I wanted that I cycle that I and just potential curious reception it the been of But transcript product? on wasn't its just kind how the about part the you thinking in long-term life how has a and realized you're for of all. of big be today.

Rene Lacerte

of create There's as Great choice earlier, make lot talked payments want it. which is suppliers they as they want and I platform receive allows just customers about question, so having that's done do, when a choice there's how And that and they for opportunities. we Josh. these can robust us what for a we've to sure what to

to oftentimes comes And instantaneously. it want that that Instant payment suppliers the future. that to in to again Transfer, what seeing definitely so like is those And are suppliers we're when would there receive do

the whether them, by paying side. and from encouraged the that providing So receiving to are keep are usage you're we on encouraged repeat by we or the side the see value, we just opportunity

the for will customers to think be differentiator. that of see and I it our have that part something as be continue offering grow overall we a we a So

Josh Beck

Rene. Thanks, hear. to Great

Operator

Jefferies. Our Samana from next comes Samad, from question Samad please ahead. go

Samad Samana

thanks guys. Hi, my for taking questions

be implied quarter growth? And contribution, just larger an increases? implied looks just to accelerated. Can great see if understand have try basis I organic the subscription to looks Is on unpack Just of us should we pro Is driving that And stellar revenue John, what's would forma Bank another maybe you out it. guys, double digits how it ARPU ARPU ARPU still it price it like growing for customers? America to that part you the and maybe that a growth? year-over-year. of maybe help big

John Rettig

And base Great average specific our with customer. Samad. slightly revenue, seen regards taken. action ARPU that Thanks, have we've subscription-related question. no expansion to subscription customer the to Sure. composition skewing we organic pricing driven There's of mainly by a

larger really onto a price a monthly But been in and had get packaging price the we've a it's higher users, they of more platform, promotion because higher we tend years to point, fees. as increase. since fact, customer, and small a they couple that then, customers at In have say, enter slightly part do the therefore,

support expansion organic subscription we arrangements from So financial separate it the does institution or partners. who's of our that have the with

Samad Samana

for Okay. that, Thanks Great. John.

Operator

next Matt, from Our comes line question from is VanVliet open. BTIG. Matt your

Matthew VanVliet

existing a up Yes. dialogue the question. product has the much Thanks you customers SMB just quarter. organically? with about of thinking be little learned of FI where BofA, of more world either the And of the maybe institution guess taking your Nice open terms maybe or development leverage the job for channel after some how new around relationships in does in complexities world the able that into new this on to what the more those I into commercial SMB financial launching that segment? you're might then going been partners,

Rene Lacerte

the offering learned, accountants been listen our part banks day. we've products SMBs And right? for. build to the for and learn the well a they is our great to things learned of support one we as and over are asking in they're asking has business how and is about services That's Lots need. to that to being And is the of the things years you of that every what reflection what Matt. as you, what one get Thank of

so think offering kind others that success they does for I their some of the the that and products how we we And can of with lead have. to any do services more customers of asking do

the digital extend and transformation behind products that are SMB our the the going we So after is the we market. that that think with as reach I to That's believe increases the increases the FIs we opportunity And real. that do teams invest our we why across space. do opportunity only

SMBs the with So mid-market stuck companies directly businesses and what serve. and we're that's do our we lots here of directly we That's partners. the That's what And to with up. clean in mess accountants. back doing office, it the of we're we are do what for

Matthew VanVliet

Thank you.

Rene Lacerte

you. Thank

Operator

Sanjay, ahead. turn from KBW. now go please Sakhrani We to Sanjay

Sanjay Sakhrani

you strong. well for asked question momentum towards you're timing investor profitability. way on on really in direction? mentioned to Rene, that too. And and is a is of a sort the the Maybe obviously, one Obviously, that earlier. Thanks. which updated Any earlier the your expectation landscape Thanks. follow-up changing, was thoughts And is call

Rene Lacerte

Thank you, Sanjay.

This this of invest scale months look the quarters. And employees you across is have years predicated Bill.com are we that about that core our just We we value success have for deliver with when of to that the over can on revenue platform. and on going the got we numbers thoughtfully at a can did said, in And we country when the our the that is focus business provide we discipline. have. We've to decades, that think super the that customers, our that kind drive of continue excited future, like we're we just future. and SMBs our we're a market had. we of diligently, drives beat just front that on have to terms X% years into of And the for not in focused massive penetration the us. ability opportunity of And the in and and think we that when

Operator

Vafi go ahead. Joe Our next question comes Canaccord Genuity. from Joe, from please

Joseph Vafi

I'll guys. here. congratulations afternoon. Hey Good add my

to done InvoiceXgo job if right and cross-sell down. we get rather wondering maybe in. an good M&A things road a focus maybe you're here. update you've nicely, map. time such It Just sooner are Obviously, later bringing on Divvy the like some more when valuations the are feels on and here product on integrating than with

So any be Thank helpful? further on thoughts would that you.

Rene Lacerte

Thank you, Joe.

to we that discussion opportunities are our feel a continue it's about to listen partners market always feel what that doing We're by focused see to if partner we and need, there's that evaluating relationship, on build have customers on and the others need. we what allows us We are lots bring we capital to in-house. the And the of internally. see books, our what and to think

about not how about value for think our customers really for we we do M&A, when So shareholders. it's add thinking we value M&A, add how do it's about and

the there's and And we the about but insights if analytics. lots that We've capital have talked opportunities. mentioned we and can so about platform. payroll HR this, extend mean things our past. business of that back-office and working save And I we the to lots that's about ultimately that I ways We've to interest financial of can know talked have. in don't powerful. happier for the more that the goal customers. reach, we automate makes drive that's customers mess, continue on time their can super operations XX% we the do will customers me. And When we've of

Operator

Stotler William Matt, ahead. Blair. from please Matt We now to turn go

Matthew Stotler

on you how the it's traction, are into how would in to that But subscription that bit going the kind love taking of of terms to SMB that. on X% left employer things the little Would impact upmarket, [indiscernible] platform customer. and and dig see kind a And of revenue for lift update going average there's some more know think you and understand of you're of the quarter trajectory like question. expanding ton mid-market I I of move that, get John, Hey a forward? of love the an the providing mentioned guys. in that mentioned maybe in had upward per SMBs forward. the opportunity to that into the Thanks Obviously, you business, the right? segment

Rene Lacerte

mid-market us what and were specific we past because that breadth then to of in the have Okay. And allows things Lots that able platform that and customers happens And a horizontal with in and all mid-market Thank sizes is segments, approach because we've they in needed of product, we of them. talked on approach. attract goodness understand our the bring about what of a we're and companies all to that seeing you, were right? having Matt. horizontal to

activities, that's specific that getting business feel and and better focused so been the couple better and doing that customers years. per-unit reach seeing are the overall that those do do success we're the Whether that, basis. or John those make to do the in we to that and have increase the to on a over scale and attract of on ARPU. product a the And that's that when for we we’ve been mentioned last able marketing we're opportunity the And they we've impact reason and difference sales and doing they whether them. comes ARPU customers, they is really that higher at a of to And things it TPV

to continue is successful. to to important going valuable the super we believe us. that's going focus we're them So and to listen We're that mid-market And to customers. continue to something make to drive

Matthew Stotler

again. Thanks Great.

Rene Lacerte

Thank you.

Operator

Clark from to Lamar, Nikko We Lamar [Operator turn now line SMBC Americas Instructions] open. now is your Incorporated.

Andrew Bauch

from assume I you Andrew of side. when on at early have journeys mix payments. X,XXX did innings manual lot those mean I big yields X.X in talk the SMBC. influx year-over-year to a core actually progression in new that is of of would this that of again. And this are the had bps yields this have you've about quarter, year their I higher a you a for of automation may Bill this wanted still customers and Sorry, AP

slow reason customers? down new there that could any is So of that this influx the we've big seen year-over-year like with trajectory

John Rettig

for significant in Andrew, year-over-year. This monetization increased the We're you very happy is growth noted, progress, really as with John. question. thanks the

automating life financial right through there's on platform. operations, a cycle their when customers our absolutely including go they're that that You're

first newer get increasing transaction adoption of all. network tend platform, we more result have see of products they electronic higher some have they to their further of go many course up. of when subscribed the has that electronic a that, that of the payments the as tend to payments And have monetization. not the some effect So to engaged ad the valorem suppliers And we They Bill.com see the quarters, they with we check our overall the several of payments. on versus over platform, but as

the early virtual not cards fashion it's products, long still go. going a go. some Transfer way or of cycle a cross-border nevertheless, longer whether Instant where we're linear with like a and adoption quarter-to-quarter. happen But payments long or newer the So in even term, to still think feel there's we way in to perfect the It's to FX they're over there's

Andrew Bauch

congrats on and guys, Thanks, Understood. quarter. the

John Rettig

you. Thank

Operator

Oppenheimer from please Brian Schwartz ahead. to turn now Company. & go Brian, We

Brian Schwartz

you that, I just Rene my would increase my question. think John. following that comment John, the assumption Hi, customer size an I is average the core Bill.com and taking upward question made pressures average that would channel. for you your with in guess in – the assume across But driving saw business. really up, I to a wanted that to financial is I are Or one all is, customer distribution you the come you channels? upward size? Thanks. institutions seeing momentum those ask Thanks

John Rettig

Great. Thanks, Brian.

I think it's really across the board.

from to all of of smallest for the There's that are think I through globally Bill.com Just clarify, are of mean, the tens candidates millions mid-market. we we serving businesses platform. about businesses

some as that we the do through across demand distribution we as see cases, our firm relationships institution really or, see marketing So but we're and platform gen channels. moving or mentioned, necessarily our from well. financial we midsize companies. through In not partners were mid-market And come to you increasing all directly, to accounting upmarket, of them demand our digital

small the So we're obviously like to those extent our it's ones, really motivated them. works a customers broad-based platform the to serve And just that demand. for really larger

Brian Schwartz

John. Thanks,

John Rettig

Sure.

Operator

Our comes please ahead. from Suchoski go Research. Ken, from Autonomous Ken question last

Kenneth Suchoski

about again it the I for customer. mean up I mean out move I Thanks double-digit. two the in squeezing just higher we've here. continues seen quarters, TPV it per it's me quarter-over-quarter. of to guys. wanted been Hey and like to ask three last looks

of get that's when just year-over-year. million your So a we figure per at a for because sustainability tracking on sense customer at TPV annualized north just that I basis. you're an $X mean look trying the to incremental of

So comments per the on TPV would there? just sustainability love and that any customer

John Rettig

choices of the offer operations mean to a that platform. the businesses, on payment share wallet. Sure. serve our then payment of And to is of their years That and into volume couple financial things payment We're to customer. we payment the in that the volume higher translates more activity last the able per consolidate through more Thanks, Ken. they flows more of we've their activity. one I realized that

And of, to I So quarters think customer. one I seen, think more an point a that we're that I beneficiary speaks expansion And been a the activity per just we've it's on organic by last the lot think, fact $XXX,XXX up year. actually of basis, customers the And row place quarter, realize their we've that. TPV of in north value of of financial versus doing in in six-plus in from operations solutions. significantly

Kenneth Suchoski

guys. sense. job. Makes Great Thanks

John Rettig

Thank you.

Rene Lacerte

look pursue Thanks, transform joining us to for you. today. growth help we strong our we financial we the SMBs tremendous as operations, everyone, forward ahead. as Thank communicating We and their progress opportunity delivered

Operator

call. today's for you This joining. concludes We thank

now lines. You your disconnect may

Bill.com (BILL) 4 Feb 222022 Q2 Earnings call transcript