In a move that underscores management's confidence despite a cooling growth outlook, BILL Holdings (NYSE:BILL) revealed it repurchased approximately 8.4 million shares during the fiscal fourth quarter, deploying roughly $300 million. The implied average purchase price of $35.71 sits notably below the stock's Thursday close of $47.40, representing a 24.7% discount and an unrealized gain of about 32.7% on the buyback.
The buyback comes as the company projects a slowdown in core revenue growth for fiscal 2027. BILL guided core revenue to a range of $1.669 billion to $1.719 billion, implying a midpoint increase of 12.6% compared to fiscal 2026's 16% growth. Total revenue is expected to reach $1.807 billion to $1.857 billion, up 10.8% at the midpoint.
Quarterly Performance Highlights
For the fiscal fourth quarter ended June 30, 2026, BILL reported total revenue of $436.2 million, a 14% year-over-year increase. Core revenue advanced 16% to $400.5 million, driven by a 17% rise in transaction fees. The company also posted a GAAP gross margin of 81.7%, up 90 basis points from the prior year.
Non-GAAP operating income surged 80% to $101.6 million, while GAAP net loss widened to $18.5 million from $7.1 million a year earlier. The growing gap between non-GAAP and GAAP results is largely attributed to stock-based compensation, restructuring charges, and other excluded expenses.
Operational Metrics and Customer Trends
Despite a slight decline in customer count, payment volumes remained robust. Total payment volume reached $98 billion, up 14% year-over-year, with 37 million transactions processed, also up 14%. The number of businesses using BILL solutions fell to 479,300 from 493,800, a 2.9% decrease. Independent network users grew 11% to 9.2 million.
The decline in customer numbers poses a challenge for cross-selling and retention, even as payment volume per relationship increases.
Fiscal 2027 Outlook and Strategic Shift
Looking ahead, BILL projects non-GAAP operating income of $421 million to $451 million, up 34.7% at the midpoint, and non-GAAP diluted EPS of $3.56 to $3.79. CFO Rohini Jain emphasized that "growth and margin expansion are not a trade-off at BILL," signaling a focus on profitability.
Investors should note a reporting change: starting next quarter, rewards expense will be deducted from revenue rather than sales and marketing expenses. The guidance reflects pre-deduction figures and includes $401.5 million in projected rewards expense for fiscal 2027.
Analyst Sentiment and Market Reaction
Wall Street remains cautiously optimistic, with nine Buy ratings and six Holds, and a consensus price target of $55.23, representing a 16.5% premium to Thursday's close. Analysts like BTIG's Andrew Harte see the core-revenue guidance as "a measure of prudence," with customer stabilization being a key positive indicator.
BILL shares closed at $47.40 on August 20, down 0.65%, but edged up to $47.60 in after-hours trading. The stock trades below its 52-week high of $57.21.
As the company navigates a slower growth phase, the buyback provides a valuation anchor, but sustained gains will depend on execution and the ability to reverse customer attrition.
