8-K
BILL Holdings, Inc. (BILL)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENTREPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 6, 2020
Bill.com Holdings, Inc.
(Exact name of Registrant as specified in its charter)
| Delaware | 001-39149 | 83-2661725 |
|---|---|---|
| (State or other jurisdiction<br><br><br>of incorporation) | (Commission<br><br><br>File Number) | (IRS Employer<br><br><br>Identification No.) |
1810 Embarcadero Road
Palo Alto, California 94303
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code: (650) 621-7700
N/A
(Former Name orFormer Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the<br>Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br><br><br>Symbol(s) | Name of each exchange<br><br><br>on which registered |
|---|---|---|
| Common Stock, par value $0.00001 | BILL | The New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On February 6, 2020, Bill.com Holdings, Inc. (the “Company”) issued a press release and will hold a conference call regarding its financial results for the second fiscal quarter ended December 31, 2019. A copy of the press release is furnished as Exhibit 99.1 to this report.
The information furnished with this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any other filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.
The Company is making reference to non-GAAP financial information in both the press release and the conference call. A reconciliation of GAAP to non-GAAP results is provided in the attached Exhibit 99.1 press release.
The Company announces material information to the public through a variety of means, including filings with the Securities and Exchange Commission, press releases, public conference calls, and the Company’s investor relations website (https://investor.bill.com) as means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(d) Exhibits.
| Exhibit<br><br><br>Number | Description |
|---|---|
| 99.1 | Press release dated February 6, 2020 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BILL.COM HOLDINGS, INC. | ||
|---|---|---|
| Date: February 6, 2020 | By: | /s/ John Rettig |
| John Rettig | ||
| Chief Financial Officer and Executive Vice President, Finance and Operations |
EX-99.1
Exhibit 99.1
Bill.com Reports Second Quarter Fiscal 2020 Financial Results
| • | Total Quarterly Revenue Growth of 50% Year-over-Year |
|---|---|
| • | Subscription and Transaction Revenue Increases 61% Year-over-Year |
| --- | --- |
PALO ALTO, CALIF. – February 6, 2020 – 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, today announced financial results for the second fiscal quarter ended December 31, 2019.
“I am very happy to report that in our first quarter as a public company we posted strong results. Our performance this quarter was highlighted by solid revenue growth and expansion of non-GAAP gross margins,” said Bill.com CEO René Lacerte. “Customers continue to leverage the platform to automate their financial operations, resulting in accelerating core (subscription and transaction) revenue growth year-over-year.”
Financial Highlights for the Second Quarter of Fiscal 2020
| • | Total revenue for the quarter was $39.1 million, an increase of 50% from the second quarter of fiscal 2019.<br>Subscription and transaction revenue was $33.0 million, an increase of 61% from the second quarter of fiscal 2019. Interest on funds held for customers, which we refer to as float revenue, was $6.1 million, an increase of 10% from the<br>second quarter of fiscal 2019. |
|---|---|
| • | GAAP gross profit was $29.3 million, or 75.0% gross margin, compared to $18.8 million, or 72.4% gross<br>margin in the second quarter of fiscal 2019. Non-GAAP gross profit was $30.5 million, or 78.0% gross margin, compared to $19.7 million, or 75.8% in the second quarter of fiscal 2019.<br> |
| --- | --- |
| • | Loss from operations was $7.9 million, compared to loss from operations of $590,000 in the second quarter of<br>fiscal 2019. Non-GAAP loss from operations for the second quarter was $4.5 million, compared to a non-GAAP loss from operations of $69,000 in the second quarter of<br>fiscal 2019. |
| --- | --- |
| • | Net loss was $7.6 million, or ($0.34) per share, basic and diluted, compared to net income of $102,000, or<br>$0.00 per share, basic and diluted, in the second quarter of fiscal 2019. Non-GAAP net loss was $3.6 million, or ($0.06) per share, basic and diluted, compared to<br>non-GAAP net income of $330,000, or $0.01 per share, basic and diluted, in the same period last year. |
| --- | --- |
| • | Cash, cash equivalents and short-term investments were $383.0 million at December 31, 2019.<br> |
| --- | --- |
Recent Business Highlights
| • | Completed initial public offering (IPO) on December 12, 2019. |
|---|---|
| • | Served 85,900 customers, representing year-over-year customer growth of 20%. |
| --- | --- |
| • | Processed $24.8 billion in total payment volume on our platform, an increase of 41% year-over-year.<br> |
| --- | --- |
| • | Processed over 6.2 million transactions, representing an increase of 29% over the year ago period.<br> |
| --- | --- |
| • | Expanded coverage for cross-border payments to support over 130 countries. |
| --- | --- |
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 the second quarter of fiscal 2020 results and our outlook for the third quarter of fiscal 2020 and the full fiscal year 2020. 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.
Bill.com announces material information to the public through a variety of means, including filings with the Securities and Exchange Commission (“SEC”), press releases, public conference calls, and the Investor Relations section of Bill.com’s website as means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.
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 financial software platform creates connections between businesses and their suppliers and clients. It helps manage cash inflows and outflows. 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 Palo Alto, 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 and results in the third quarter of fiscal 2020 and the full fiscal year 2020, 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, 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 prospectus as amended and filed with the SEC pursuant to Rule 424(b)(4) on December 12, 2019 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. 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 expense using a variety of valuation methodologies and subjective assumptions.
Depreciation and amortization expense. We exclude depreciation and amortization expense 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. 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 measure provides us useful information in evaluating and comparing the consistency of our operating performance on a period-to-period basis.
Capitalized sales commissions. We include capitalization and exclude the subsequent amortization of sales commissions in certain of our non-GAAP financial measures. We capitalize sales commissions that are incremental costs in obtaining new customer contracts and we amortize such costs over the benefit period of our relationship with the acquired customers. We believe that including or excluding the effect of the capitalization of sales commissions 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.
Capitalized service costs. We include capitalization and exclude the subsequent amortization of service costs in certain of our non-GAAP financial measures. These service costs, which primarily consist of direct payroll costs, pertain to the implementation services that we provide to our financial institution customers and certain SMB customers prior to the launching of our product for general use. We capitalize such service costs and amortize them over the estimated benefit period. Our implementation service is generally a non-recurring type of service that we perform for our new customers. We believe that including or excluding the effect of the capitalization of service costs in certain of our non-GAAP financial measure provides us useful information in evaluating and comparing the consistency of our operating performance on a period-to-period basis.
Gain or loss on revaluation of warrant liabilities and gain on forfeiture of warrants. We exclude gain or loss on revaluation of warrant liabilities and gain on forfeiture of warrants, which is a non-cash income or expense, from certain of our non-GAAP financial measures because we believe that excluding this item provides meaningful supplemental information regarding operational performance.
Stock warrants expense. We exclude stock warrants 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.
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, | |||||
|---|---|---|---|---|---|---|
| 2019 | 2019 | |||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 314,894 | $ | 90,306 | ||
| Short-term investments | 68,135 | 71,969 | ||||
| Accounts receivable, net | 4,791 | 4,398 | ||||
| Unbilled revenue | 5,909 | 4,795 | ||||
| Prepaid expenses and other current assets | 15,768 | 12,326 | ||||
| Funds held for customers | 1,491,763 | 1,329,306 | ||||
| Total current assets | 1,901,260 | 1,513,100 | ||||
| Property and equipment, net | 7,511 | 6,557 | ||||
| Other assets | 6,353 | 6,641 | ||||
| Total assets | $ | 1,915,124 | $ | 1,526,298 | ||
| LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY(DEFICIT) | ||||||
| Current liabilities: | ||||||
| Accounts payable | $ | 6,018 | $ | 5,063 | ||
| Accrued compensation and benefits | 6,379 | 4,333 | ||||
| Other accrued and current liabilities | 9,872 | 6,556 | ||||
| Redeemable convertible preferred stock warrant liabilities | — | 688 | ||||
| Deferred revenue | 4,274 | 3,469 | ||||
| Customer fund deposits | 1,491,763 | 1,329,306 | ||||
| Total current liabilities | 1,518,306 | 1,349,415 | ||||
| Deferred revenue, non-current | 2,091 | 1,786 | ||||
| Other long-term liabilities | 1,375 | 1,447 | ||||
| Total liabilities | 1,521,772 | 1,352,648 | ||||
| Commitments and contingencies | ||||||
| Redeemable convertible preferred stock | — | 276,307 | ||||
| Stockholders’ equity (deficit): | ||||||
| Preferred stock | — | — | ||||
| Common stock | 2 | 1 | ||||
| Additional paid-in capital | 524,260 | 14,672 | ||||
| Accumulated other comprehensive income | 20 | 326 | ||||
| Accumulated deficit | (130,930 | ) | (117,656 | ) | ||
| Total stockholders’ equity (deficit) | 393,352 | (102,657 | ) | |||
| Total liabilities, redeemable convertible preferred stock and stockholders’ equity<br>(deficit) | $ | 1,915,124 | $ | 1,526,298 |
BILL.COM HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands except per share amounts)
| Three months ended<br>December 31, | Six months ended<br>December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| Revenue | ||||||||||||
| Subscription and transaction fees | $ | 32,964 | $ | 20,444 | $ | 61,512 | $ | 38,614 | ||||
| Interest on funds held for customers | 6,116 | 5,555 | 12,748 | 9,809 | ||||||||
| Total revenue | 39,080 | 25,999 | 74,260 | 48,423 | ||||||||
| Cost of revenue ^(1)^ | 9,787 | 7,175 | 18,934 | 13,516 | ||||||||
| Gross profit | 29,293 | 18,824 | 55,326 | 34,907 | ||||||||
| Operating expenses | ||||||||||||
| Research and development ^(1)^ | 12,992 | 6,154 | 24,507 | 11,578 | ||||||||
| Sales and marketing ^(1)^ | 11,491 | 6,856 | 21,758 | 12,800 | ||||||||
| General and administrative ^(1)^ | 12,748 | 6,404 | 23,283 | 12,341 | ||||||||
| Total operating expenses | 37,231 | 19,414 | 69,548 | 36,719 | ||||||||
| Loss from operations | (7,938 | ) | (590 | ) | (14,222 | ) | (1,812 | ) | ||||
| Other income, net | 360 | 686 | 999 | 1,003 | ||||||||
| (Loss) income before (benefit from) provision for income taxes | (7,578 | ) | 96 | (13,223 | ) | (809 | ) | |||||
| (Benefit from) provision for income taxes | — | (6 | ) | 51 | (27 | ) | ||||||
| Net (loss) income | $ | (7,578 | ) | $ | 102 | $ | (13,274 | ) | $ | (782 | ) | |
| Net (loss) income per share attributable to common stockholders, basic and diluted | $ | (0.34 | ) | $ | — | $ | (0.87 | ) | $ | (0.10 | ) | |
| Weighted-average number of common shares used to compute net (loss) income per share attributable<br>to common stockholders, basic and diluted | 22,306 | 7,739 | 15,268 | 7,581 | ||||||||
| ^(1)^ Includes stock-based<br>compensation expense as follows: | ||||||||||||
| Cost of revenue | $ | 211 | $ | 42 | $ | 359 | $ | 112 | ||||
| Research and development | 1,084 | 119 | 1,755 | 352 | ||||||||
| Sales and marketing | 494 | 122 | 877 | 288 | ||||||||
| General and administrative | 1,286 | 311 | 2,360 | 449 | ||||||||
| $ | 3,075 | $ | 594 | $ | 5,351 | $ | 1,201 |
BILL.COM HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
| Three months ended<br>December 31, | Six months ended<br>December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||
| Net (loss) income | $ | (7,578 | ) | $ | 102 | $ | (13,274 | ) | $ | (782 | ) | |
| Adjustments to reconcile net (loss) income to net cash (used in) provided by operating<br>activities: | ||||||||||||
| Depreciation and amortization | 1,120 | 808 | 2,105 | 1,573 | ||||||||
| Stock-based compensation | 3,075 | 594 | 5,351 | 1,201 | ||||||||
| Accretion of discount on investment in marketable debt securities | (1,616 | ) | (296 | ) | (2,346 | ) | (461 | ) | ||||
| Revaluation of warrant liabilities and forfeiture of warrants | 552 | (294 | ) | 717 | (305 | ) | ||||||
| Issuance of warrants | — | — | — | 52 | ||||||||
| Deferred income taxes | — | (7 | ) | — | (44 | ) | ||||||
| Changes in assets and liabilities: | ||||||||||||
| Accounts receivable | (1,100 | ) | (1,276 | ) | (393 | ) | (2,372 | ) | ||||
| Unbilled revenue | (493 | ) | (365 | ) | (1,114 | ) | (883 | ) | ||||
| Prepaid expenses and other current assets | (466 | ) | (1,875 | ) | (1,608 | ) | (2,996 | ) | ||||
| Other assets | (531 | ) | 249 | (581 | ) | (601 | ) | |||||
| Accounts payable | 638 | 1,211 | 1,146 | 2,259 | ||||||||
| Accrued and other current liabilities | 3,419 | 702 | 4,551 | 855 | ||||||||
| Other long-term liabilities | 94 | (24 | ) | 187 | (109 | ) | ||||||
| Deferred revenue | 1,117 | 547 | 1,110 | 434 | ||||||||
| Net cash (used in) provided by operating activities | (1,769 | ) | 76 | (4,149 | ) | (2,179 | ) | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||
| Purchases of corporate and customer fund short-term investments | (225,444 | ) | (224,128 | ) | (414,648 | ) | (415,326 | ) | ||||
| Proceeds from maturities of corporate and customer fund short-term investments | 152,065 | 176,550 | 407,236 | 382,984 | ||||||||
| Proceeds from sale of corporate and customer fund short-term investments | 11,964 | 29,162 | 22,725 | 29,162 | ||||||||
| Decrease (increase) in restricted cash and cash equivalents and other receivables included in<br>funds held for customers | 39,519 | (180,650 | ) | (173,730 | ) | (298,650 | ) | |||||
| Purchases of property and equipment | (1,026 | ) | (737 | ) | (2,972 | ) | (1,571 | ) | ||||
| Capitalization of internal-use software costs | (125 | ) | (412 | ) | (340 | ) | (833 | ) | ||||
| Decrease in restricted cash | — | — | 550 | — | ||||||||
| Net cash used in investing activities | (23,047 | ) | (200,215 | ) | (161,179 | ) | (304,234 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||
| Proceeds from issuance of common stock upon initial public offering, net of underwriting discounts<br>and commissions and other offering costs | 227,439 | — | 226,565 | — | ||||||||
| Proceeds from issuance of redeemable convertible preferred stock, net of issuance costs | — | 69,801 | — | 69,801 | ||||||||
| Increase in customer fund deposits liability | 25,271 | 199,090 | 162,457 | 297,813 | ||||||||
| Payments on bank borrowings | — | (417 | ) | — | (417 | ) | ||||||
| Proceeds from exercise of stock options | 607 | 491 | 901 | 949 | ||||||||
| Proceeds from exercise of stock warrants | 144 | — | 144 | — | ||||||||
| Payments of deferred debt issuance costs | — | — | (151 | ) | — | |||||||
| Net cash provided by financing activities | 253,461 | 268,965 | 389,916 | 368,146 | ||||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 228,645 | 68,826 | 224,588 | 61,733 | ||||||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 86,249 | 15,308 | 90,306 | 22,401 | ||||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 314,894 | $ | 84,134 | $ | 314,894 | $ | 84,134 |
BILL.COM HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP DATA
FOR THE THREE MONTHS ENDED DECEMBER 31, 2019
(Unaudited, in thousands except percentages and per share amounts)
| Stock-based<br>compensation<br>expense | Other cost<br>and operating<br>expenses^(1)^ | Non-GAAP | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Total revenue | 39,080 | $ | 39,080 | ||||||||
| Cost of revenue | 9,787 | (211 | ) | (982 | ) | 8,594 | |||||
| Gross profit | 29,293 | 211 | 982 | 30,486 | |||||||
| Gross margin | 75.0 | % | 0.5 | % | 2.5 | % | 78.0 | % | |||
| Operating expenses | |||||||||||
| Research and development | 12,992 | (1,084 | ) | 74 | 11,982 | ||||||
| Sales and marketing | 11,491 | (494 | ) | 682 | 11,679 | ||||||
| General and administrative | 12,748 | (1,286 | ) | (127 | ) | 11,335 | |||||
| Loss from operations | (7,938 | ) | 3,075 | 353 | (4,510 | ) | |||||
| Operating margin | (20 | )% | 8 | % | 0 | % | (12 | )% | |||
| Other income, net | 360 | — | 552 | 912 | |||||||
| Loss before provision for income taxes | (7,578 | ) | 3,075 | 905 | (3,598 | ) | |||||
| Provision for income taxes | — | — | — | — | |||||||
| Net loss | (7,578 | ) | $ | 3,075 | $ | 905 | $ | (3,598 | ) | ||
| Net loss per share attributable to common stockholders, basic and diluted (2) | (0.34 | ) | $ | (0.06 | ) | ||||||
| Weighted-average number of common shares used to compute net loss per share attributable to common<br>stockholders, basic and diluted (3) | 22,306 | 62,771 | |||||||||
| (1) Other cost and operating<br>expenses adjustments consist of depreciation and amortization expense of 1,120 and loss on revaluation of warrant liabilities of 552; offset by capitalization of contract and service costs (net of amortization) of 767. | |||||||||||
| (2) GAAP net loss per share<br>attributable to common stockholders, basic and diluted | $ | (0.34 | ) | ||||||||
| Stock-based compensation expense | 0.14 | ||||||||||
| Depreciation and amortization and other expense adjustments | 0.04 | ||||||||||
| Impact of the assumed conversion of redeemable convertible preferred<br>stock | 0.10 | ||||||||||
| Non-GAAP net loss per share attributable<br>to common stockholders, basic and diluted | $ | (0.06 | ) | ||||||||
| (3) Shares used to compute<br>GAAP net loss per share attributable to common stockholders, basic and diluted | 22,306 | ||||||||||
| Weighted average effect of the assumed conversion of redeemable convertible<br>preferred stock from the date of issuance | 40,465 | ||||||||||
| Shares used to compute non-GAAP net loss<br>per share attributable to common stockholders, basic and diluted | 62,771 |
All values are in US Dollars.
BILL.COM HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP DATA
FOR THE THREE MONTHS ENDED DECEMBER 31, 2018
(Unaudited, in thousands except percentages and per share amounts)
| Stock-based<br>compensation<br>expense | Other cost<br>and operating<br>expenses^(1)^ | Non-GAAP | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Total revenue | 25,999 | $ | 25,999 | ||||||||
| Cost of revenue | 7,175 | (42 | ) | (843 | ) | 6,290 | |||||
| Gross profit | 18,824 | 42 | 843 | 19,709 | |||||||
| Gross margin | 72.4 | % | 0.2 | % | 3.2 | % | 75.8 | % | |||
| Operating expenses | |||||||||||
| Research and development | 6,154 | (119 | ) | 506 | 6,541 | ||||||
| Sales and marketing | 6,856 | (122 | ) | 492 | 7,226 | ||||||
| General and administrative | 6,404 | (311 | ) | (82 | ) | 6,011 | |||||
| Loss from operations | (590 | ) | 594 | (73 | ) | (69 | ) | ||||
| Operating margin | (3 | )% | 3 | % | 0 | % | 0 | % | |||
| Other income, net | 686 | — | (293 | ) | 393 | ||||||
| Income before benefit from income taxes | 96 | 594 | (366 | ) | 324 | ||||||
| Benefit from income taxes | (6 | ) | — | — | (6 | ) | |||||
| Net income | 102 | $ | 594 | $ | (366 | ) | $ | 330 | |||
| Net income per share attributable to common stockholders, basic and diluted (2) | — | $ | 0.01 | ||||||||
| Weighted-average number of common shares used to compute net income per share attributable to<br>common stockholders, basic and diluted (3) | 7,739 | 55,374 | |||||||||
| (1) Other cost and operating<br>expenses adjustments consist of depreciation and amortization expense of 808; offset by capitalization of contract and service costs (net of amortization) of 880 and gain on forfeiture of warrants (net of loss on revaluation of warrant<br>liabilities) of 294. | |||||||||||
| (2) GAAP net income per share<br>attributable to common stockholders, basic and diluted | $ | — | |||||||||
| Stock-based compensation expense | 0.08 | ||||||||||
| Depreciation and amortization and other expense adjustments | (0.05 | ) | |||||||||
| Impact of the assumed conversion of redeemable convertible preferred<br>stock | (0.02 | ) | |||||||||
| Non-GAAP net income per share attributable<br>to common stockholders, basic and diluted | $ | 0.01 | |||||||||
| (3) Shares used to compute<br>GAAP net income per share attributable to common stockholders, basic and diluted | 7,739 | ||||||||||
| Weighted average effect of the assumed conversion of redeemable convertible<br>preferred stock from the date of issuance | 47,635 | ||||||||||
| Shares used to compute non-GAAP net income<br>per share attributable to common stockholders, basic and diluted | 55,374 |
All values are in US Dollars.
BILL.COM HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP DATA
FOR THE SIX MONTHS ENDED DECEMBER 31, 2019
(Unaudited, in thousands except percentages and per share amounts)
| Stock-based<br>compensation<br>expense | Other cost<br>and operating<br>expenses^(1)^ | Non-GAAP | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Total revenue | 74,260 | $ | 74,260 | ||||||||
| Cost of revenue | 18,934 | (359 | ) | (1,970 | ) | 16,605 | |||||
| Gross profit | 55,326 | 359 | 1,970 | 57,655 | |||||||
| Gross margin | 74.5 | % | 0.5 | % | 2.6 | % | 77.6 | % | |||
| Operating expenses | |||||||||||
| Research and development | 24,507 | (1,755 | ) | 173 | 22,925 | ||||||
| Sales and marketing | 21,758 | (877 | ) | 1,142 | 22,023 | ||||||
| General and administrative | 23,283 | (2,360 | ) | (193 | ) | 20,730 | |||||
| Loss from operations | (14,222 | ) | 5,351 | 848 | (8,023 | ) | |||||
| Operating margin | (19 | )% | 7 | % | 1 | % | (11 | )% | |||
| Other income, net | 999 | — | 717 | 1,716 | |||||||
| Loss before provision for income taxes | (13,223 | ) | 5,351 | 1,565 | (6,307 | ) | |||||
| Provision for income taxes | 51 | — | — | 51 | |||||||
| Net loss | (13,274 | ) | $ | 5,351 | $ | 1,565 | $ | (6,358 | ) | ||
| Net loss per share attributable to common stockholders, basic and diluted (2) | (0.87 | ) | $ | (0.10 | ) | ||||||
| Weighted-average number of common shares used to compute net loss per share attributable to common<br>stockholders, basic and diluted (3) | 15,268 | 61,718 | |||||||||
| (1) Other cost and operating<br>expenses adjustments consist of depreciation and amortization expense of 2,105 and loss on revaluation of warrant liabilities of 717; offset by capitalization of contract and service costs (net of amortization) of 1,257. | |||||||||||
| (2) GAAP net loss per share<br>attributable to common stockholders, basic and diluted | $ | (0.87 | ) | ||||||||
| Stock-based compensation expense | 0.35 | ||||||||||
| Depreciation and amortization and other expense adjustments | 0.10 | ||||||||||
| Impact of the assumed conversion of redeemable convertible preferred stock | 0.32 | ||||||||||
| Non-GAAP net loss per share attributable to<br>common stockholders, basic and diluted | $ | (0.10 | ) | ||||||||
| (3) Shares used to compute GAAP<br>net loss per share attributable to common stockholders, basic and diluted | 15,268 | ||||||||||
| Weighted average effect of the assumed conversion of redeemable convertible preferred<br>stock from the date of issuance | 46,450 | ||||||||||
| Shares used to compute non-GAAP net loss per<br>share attributable to common stockholders, basic and diluted | 61,718 |
All values are in US Dollars.
BILL.COM HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP DATA
FOR THE SIX MONTHS ENDED DECEMBER 31, 2018
(Unaudited, in thousands except percentages and per share amounts)
| Stock-based<br>compensation<br>expense | Other cost<br>and operating<br>expenses^(1)^ | Non-GAAP | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Total revenue | 48,423 | $ | 48,423 | ||||||||
| Cost of revenue | 13,516 | (112 | ) | (1,538 | ) | 11,866 | |||||
| Gross profit | 34,907 | 112 | 1,538 | 36,557 | |||||||
| Gross margin | 72.1 | % | 0.2 | % | 3.2 | % | 75.5 | % | |||
| Operating expenses | |||||||||||
| Research and development | 11,578 | (352 | ) | 1,474 | 12,700 | ||||||
| Sales and marketing | 12,800 | (288 | ) | 478 | 12,990 | ||||||
| General and administrative | 12,341 | (449 | ) | (182 | ) | 11,710 | |||||
| Loss from operations | (1,812 | ) | 1,201 | (232 | ) | (843 | ) | ||||
| Operating margin | (4 | )% | 2 | % | 0 | % | (2 | )% | |||
| Other income, net | 1,003 | — | (293 | ) | 710 | ||||||
| Loss before benefit from income taxes | (809 | ) | 1,201 | (525 | ) | (133 | ) | ||||
| Benefit from income taxes | (27 | ) | — | — | (27 | ) | |||||
| Net loss | (782 | ) | $ | 1,201 | $ | (525 | ) | $ | (106 | ) | |
| Net loss per share attributable to common stockholders, basic and diluted (2) | (0.10 | ) | $ | — | |||||||
| Weighted-average number of common shares used to compute net loss per share attributable to common<br>stockholders, basic and diluted (3) | 7,581 | 54,964 | |||||||||
| (1) Other cost and operating<br>expenses adjustments consist of depreciation and amortization expense of 1,573 and warrant expense of 52; offset by capitalization of contract and service costs (net of amortization) of 1,845 and gain on forfeiture of warrants (net of loss on<br>revaluation of warrant liabilities) of 305. | |||||||||||
| (2) GAAP net loss per share<br>attributable to common stockholders, basic and diluted | $ | (0.10 | ) | ||||||||
| Stock-based compensation expense | 0.16 | ||||||||||
| Depreciation and amortization and other expense adjustments | (0.07 | ) | |||||||||
| Impact of the assumed conversion of redeemable convertible preferred<br>stock | 0.01 | ||||||||||
| Non-GAAP net loss per share attributable<br>to common stockholders, basic and diluted | $ | — | |||||||||
| (3) Shares used to compute<br>GAAP net loss per share attributable to common stockholders, basic and diluted | 7,581 | ||||||||||
| Weighted average effect of the assumed conversion of redeemable convertible<br>preferred stock from the date of issuance | 47,383 | ||||||||||
| Shares used to compute non-GAAP net loss<br>per share attributable to common stockholders, basic and diluted | 54,964 |
All values are in US Dollars.
BILL.COM HOLDINGS, INC.
FREE CASH FLOW
(Unaudited, in thousands)
| Three months ended<br>December 31, | Six months ended<br>December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| Net cash (used in) provided by operating activities | $ | (1,769 | ) | $ | 76 | $ | (4,149 | ) | $ | (2,179 | ) | |
| Purchases of property and equipment | (1,026 | ) | (737 | ) | (2,972 | ) | (1,571 | ) | ||||
| Capitalization of internal-use software costs | (125 | ) | (412 | ) | (340 | ) | (833 | ) | ||||
| Free cash flow | $ | (2,920 | ) | $ | (1,073 | ) | $ | (7,461 | ) | $ | (4,583 | ) |
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Carolyn Bass
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