BILL Delivers Double-Digit Core Revenue Growth and Expands Margins Amid Active Share Buybacks
Core Revenue Growth Accelerates to 17% Year-over-Year
BILL's latest quarterly report highlights a strong performance in the second quarter of fiscal year 2026, with core revenue rising by 17% year-over-year to $375.1 million. This momentum was driven by a notable 20% increase in transaction fees, while subscription fees saw a modest 6% lift. Total revenue reached $414.7 million, up 14% over the same period last year, underscoring consistent demand for BILL’s intelligent finance platform among nearly half a million businesses.
Disciplined Margin Enhancement and Operational Efficiency
BILL improved its margin profile with a GAAP gross margin of 79.8% and a non-GAAP gross margin of 83.9%. Operating efficiency was further evidenced by a narrowed operating loss and strong non-GAAP operating income of $74.1 million, representing an 18% year-over-year increase. Non-GAAP net income for the quarter came in at $73.38 million, or $0.64 per diluted share, compared to $62.91 million and $0.56 per share one year ago.
| Q2 FY26 Key Metric | Value | YoY Change |
|---|---|---|
| Total Revenue | $414.7M | +14% |
| Core Revenue | $375.1M | +17% |
| Transaction Fees | $303.1M | +20% |
| Subscription Fees | $72.1M | +6% |
| Non-GAAP Gross Margin | 83.9% | -1.3pp |
| Non-GAAP Operating Income | $74.1M | +18% |
| Non-GAAP Net Income | $73.4M | +17% |
| Non-GAAP EPS (Diluted) | $0.64 | +14% |
| Free Cash Flow | $91.13M | +27% |
Operational Scale and Shareholder-Focused Capital Deployment
In Q2, BILL processed $95 billion in payment volume (up 13% YoY) across 35 million transactions (up 16% YoY), serving 498,500 businesses. The company returned $133 million to shareholders through the repurchase of approximately 2.5 million shares, reflecting confidence in its business outlook and an efficient allocation of capital.
Financial Outlook Reflects Continued Topline and Margin Strength
BILL’s guidance for Q3 FY26 targets total revenue of $397.5 – $407.5 million (+11% to +14% YoY), with core revenue expected between $364.5 – $374.5 million (+14% to +17% YoY). For the full fiscal year, anticipated total revenue is $1.63 – $1.65 billion. Non-GAAP operating income for the year is projected at $274.0 – $286.5 million, with non-GAAP net income per diluted share reaching $2.33 – $2.41—demonstrating ambitions for continued growth and profitability.
| Outlook Measure | Q3 FY26 Guidance | Full FY26 Guidance |
|---|---|---|
| Total Revenue | $397.5M – $407.5M | $1,631M – $1,651M |
| Core Revenue | $364.5M – $374.5M | $1,489.5M – $1,509.5M |
| Non-GAAP Operating Income | $62.5M – $67.5M | $274M – $286.5M |
| Non-GAAP Net Income | $60.5M – $64.5M | $267.5M – $277.5M |
| Non-GAAP EPS (Diluted) | $0.53 – $0.57 | $2.33 – $2.41 |
Balance Sheet Remains Healthy, Supporting Growth and Innovation
BILL closed the quarter with $1.09 billion in cash and cash equivalents and $1.15 billion in short-term investments, positioning the company to fund operations, invest in platform innovation, and remain agile for further capital return measures if warranted. Goodwill and intangible assets stood at $2.6 billion, underlining BILL's investments in strategic acquisitions and technology development.
Takeaway: BILL Leans Into Scalable Innovation With Focus on Long-Term Value
BILL’s robust core revenue growth, expanding margins, and active share buyback signal a disciplined yet dynamic approach to scaling its intelligent finance platform. Investors may want to monitor how the company executes against its margin and growth targets for the remainder of fiscal 2026, especially as it leans into AI-driven innovations and continues to stake out a leadership position in B2B payments and automation.
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