BILL Holdings Q2 Earnings Beat Estimates on Core Strength & Higher TPV

BILL Holdings BILL reported earnings of 64 cents per share in the second quarter of fiscal 2026, surpassing the Zacks Consensus Estimate of 56 cents. The figure increased from 56 cents reported in the year-ago quarter.

Revenues of $414.7 million exceeded the consensus mark of $399.8 million and increased 14.4% year over year. This was driven by continued growth in subscription and transaction fees.

The quarter benefited from strong customer adoption and rising payment volumes. Core revenues, comprising subscription and transaction fees, remained the primary growth driver. However, float revenues, consisting of interest on funds held for customers, declined year over year. Management highlighted a focus on extending differentiation, driving efficiency, and delivering long-term shareholder value.

BILL Holdings’ Second Quarter in Detail

In the second quarter of fiscal 2026, core revenues totaled $375.1 million, up 17.4% year over year. Subscription fees of $72.1 million increased 6%, benefiting from steady expansion in software usage across small and midsize businesses. Transaction fees surged 20% to $303.1 million, reflecting strong payment volume growth and deeper adoption of BILL’s financial operations platform. Float revenues, which consist of interest on funds held for customers, were $39.5 million, down 7.9% from the prior-year quarter.

The company processed $95 billion in total payment volume (TPV), an increase of approximately 13% year over year. BILL also processed 35 million transactions during the quarter, up roughly 16% from the prior-year period. Its platform served 498,500 businesses, underscoring broad-based customer adoption and ecosystem growth.

Operating Details of BILL Holdings

In the quarter under review, non-GAAP gross profit was $347.8 million compared with $308.9 million in the year-ago quarter. However, the non-GAAP gross margin contracted slightly to 83.9% from 85.2%. Non-GAAP operating income totaled $74.1 million, up from $62.8 million in the prior-year period, marking a 18% increase.

BILL’s Balance Sheet & Cash Flow

As of Dec. 31, 2025, cash, cash equivalents and short-term investments totaled $2.24 billion, up from $2.22 billion at the end of fiscal 2025. The company generated $105.3 million in cash flow from operations in the second quarter compared with $78.7 million a year ago. BILL generated free cash flow of $91.1 million in the reported quarter.

BILL Provides Q3 & Fiscal 2026 Guidance

For the third quarter of fiscal 2026, BILL expects revenues between $397.5 million and $407.5 million, indicating 11-14% year-over-year growth. Core revenues are projected between $364.5 million and $374.5 million, suggesting a 14-17% increase year over year. Non-GAAP EPS is anticipated in the range of 53-57 cents. This is above the Zacks Consensus Estimate of 52 cents.

For fiscal 2026, the company projects revenues between $1.631 billion and $1.651 billion, implying 12-13% year-over-year growth. Core revenues are expected to range between $1.489.5 billion and $1.509.5 billion, calling for a 15-16% increase year over year. Non-GAAP earnings are forecast between $2.33 and $2.41 per share. The consensus mark for the same is currently pegged at $2.22.

Currently, BILL sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

BILL Holdings, Inc. Price, Consensus and EPS Surprise

BILL Holdings, Inc. price-consensus-eps-surprise-chart | BILL Holdings, Inc. Quote

Upcoming Earnings Releases

We now look forward to the earnings release of other stocks in the Internet- Software industry — Autodesk ADSK and Block XYZ. Both companies are scheduled to report on Feb. 26.

The consensus mark for Autodesk’s fourth-quarter EPS is pegged at $2.63, implying a 14.9% increase year over year.

The Zacks Consensus Estimate for Block’s fourth-quarter 2025 EPS stands at 65 cents, indicating a 8.5% decrease year over year.

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This article originally published on Zacks Investment Research (zacks.com).

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