0001628280-26-032387
SEC filingRevenue grew 13% YoY to $406.6M in Q3 FY2026, driven by transaction fee growth, while net income turned positive at $12.8M.
In the third quarter of fiscal 2026, total revenue increased 13% year-over-year to $406.6 million, driven primarily by transaction fee growth of 18% as Total Payment Volume rose 12% to $88.7 billion. Subscription fees grew 9% to $74.5 million, reflecting a 1% increase in businesses using the platform. Interest on funds held for customers declined 7% to $35.4 million due to lower interest rates. Gross margin improved by 40 basis points to 81.6%, benefiting from lower personnel-related costs, including stock-based compensation. Operating loss narrowed significantly from $28.9 million to $0.4 million, as revenue growth outpaced expense increases. Net income swung from a loss of $11.6 million to a profit of $12.8 million, aided by a $28.5 million improvement in operating results and lower restructuring charges relative to prior-year gains.
Revenue by segment shows strong momentum across the board. BILL AP/AR generated $183.2 million in subscription and transaction fees, up 11.9% year-over-year, driven by customer growth and higher transaction volume. BILL Spend and Expense transaction fees surged 21.3% to $167.2 million, supported by increased card payment volume (card TPV of $6.6 billion in the quarter) and higher reward rates. Embedded Solutions and Other revenue grew 11.1% to $20.7 million, benefiting from partner integrations. Interest income on customer funds, while declining, remains a meaningful contributor at $35.4 million.
Management highlighted ongoing macroeconomic uncertainties, including interest rate volatility and tariffs, which could impact SMB customers. The company is undertaking cost-efficiency measures, including a reduction in force impacting up to 30% of employees announced in May 2026. No specific revenue or earnings guidance was provided. Strategic priorities include expanding AI capabilities (BILL AI agents), deepening embed partnerships with Paychex, Oracle NetSuite, and Acumatica, and launching BILL Travel. The company believes its cash, cash equivalents, and short-term investments ($2.2 billion combined) are sufficient for at least 12 months.