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Even if you haven’t heard of Bill Holdings (NYSE: BILL), there’s a very good chance your employer has. Bill offers a range of accounting software to enterprises of all sorts and sizes.
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It’s a seemingly crowded market dominated by brands like QuickBooks, NetSuite, and ZipBooks. Bill is still something of a standout within this space, though. Its software is built from the ground up to meet the unique needs of accounts receivable and accounts payable departments, accounting firms, and supervisors who just need to keep a handle on employees’ spending. The company monetizes this cloud-based technology by charging subscription fees for access to it, or by charging a small fee for every processed payment it facilitates.
Last quarter’s revenue was up 18% year over year, extending the company’s well-established top-line progress.
BILL Revenue (Quarterly) data by YCharts
There’s no getting around the fact that Bill’s revenue growth is slowing down. Its revenue-retention rate is also falling, from better than 100% just a couple years ago to only 92% at the end of fiscal 2024 on June 30. It means at least some customers are discontinuing their service, or at least using its technology less. This slowdown could also be the result of economic headwinds that are forcing small businesses to cut costs whenever and however they can. Bill should at least be actively addressing both challenges, while sharing its plans with shareholders about how it’s doing that.
Just keep things in perspective. This company’s high-growth phase in 2022 and 2023 wasn’t exactly sustainable in light of the way it was being driven. Although top-line growth…
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