BILL 10-K & 10-Q changes, risk factors and insider trading

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together with all of the other information in this Annual Report on Form 10-K, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our consolidated financial statements and the accompanying notes included elsewhere in this Annual Report on Form 10-K before deciding whether to invest in shares of our common stock. AdditionalReferences to past events are provided by way of example only and are not intended to be a complete listing of such events or a representation as to whether or not such factors or similar events have occurred in the past or their likelihood of occurring in the future. Further, additional risks beyond those summarized below or discussed elsewhere in this Annual Report on Form 10-K,10-K may apply to our activities or operations as currently conducted or as we may conduct them in the future or in the markets in which we operate or may in the future operate.

•Our risk management efforts may not be effective to prevent fraudulent activities by our customers, subscribers, spending businesses, or their counterparties, or other third parties whichwhich, potentially augmented by AI, could expose us to material financial losses and liabilities and otherwise harm our business;

•Our business depends, in part, on our business relationships with accounting firms, financial institutionsinstitutions, software providers and other partners;

•We use artificial intelligenceAI in our business, and any challenges with successfully developing and deploying new AI tools ortools, properly managing the use of AI, or complying with emerging AI regulations could result in reputational harm, competitive harm, regulatory penalties, and legal liability, and adversely affect our results of operations;

•Payments and other financial services-related regulations and oversight are material to our business. Our failure to comply could materially harm our business;Our debt service obligations, including the Notes, may adversely affect our financial condition and results of operations;

We were incorporated in 2006 and historically have mostly experienced net losses in most periods since inception. We generated a net loss of $11.2 million, net income of $23.8 million for fiscal 2025,million, and a net lossesloss of $28.9 million, and $223.7 million for fiscal 2024,2026, 2025, and 2023,2024, respectively. As of June 30, 2025,2026, we had an accumulated deficit of $1.5$2.1 billion. While we have experienced significant revenue growth in recent years and achieved profitability on a GAAP basis in certain recent quarters and in our most recent fiscal year,quarters, we are not certain whether or when we will generate sufficient revenue to sustainably maintain or enhance our profitability profile in the future. We also expect ourOur costs and expenses tomay also increase in future periods, as a result of our investments in AI and other initiatives, which could negatively affect our future operating results if our revenue does not increase. In particular, we intend to continue to expend significant funds to further develop our platform, including introducing new products and functionality, drive new customer adoption, and expand partner integrations. Our profitability each quarter is also impacted by the mix of our revenue generated from subscriptions, transaction fees, including the mix of ad valorem transaction revenue, and interest earned on funds that we hold for the benefit of our customers. Any changes in this revenue mix will have the effect of increasing or decreasing our margins. In addition, we offer promotion programs whereby spending businesses that use our spend and expense management product can earn rewards based on transaction volume on our BILL Divvy Cards, and the cost of earned rewards that are redeemed impacts our sales and marketing expenses. Our efforts to grow our business may be costlier than we expect, and we may not be able to increase our revenue enough to offset our increased operating expenses. We may incur significant losses in the future for several reasons, including the other risks described herein, and unforeseen expenses, difficulties, complications, delays, and other unknown events. If we are unable to sustain and expand our profitability, the value of our business and common stock may significantly decrease.

Our overall performance depends in part on U.S. and international macroeconomic conditions and a significant portion of our revenue comes from SMBs. These customers tend to be more susceptible to negative impacts from economic downturns, recession, inflation, increases in interest rates or the cost of borrowing, changes in foreign currency exchange rates, including recent weakness in the U.S. dollar, the impact of the ongoing rapid development and adoption of new AI capabilities, ongoing geopolitical conflicts and related supply chain disruptions, increases in the cost of memory, computing power, and related raw materials, newly-imposed tariffs by the U.S. and foreign countries and other restrictions on international trade and supply chains,trade, financial market conditions, actual or perceived instability in the U.S. and global banking systems, increased fuel prices, and catastrophic events than larger, more established businesses, as SMBs typically have more limited financial resources than larger entities. In recent periods, we have observed SMBs reacting to the macroeconomic environment by tightening budgets and selecting lower-cost payment methods, which adversely impacted our operating results. In addition, the rate of growth in the number of businesses using our solutions has been and may continue to be impacted by current macroeconomic conditions. Finally, recent reductions in U.S. federal government spending, including in the U.S. Small Business Administration, may adversely impact the SMBs we serve.

More broadly, the U.S. and other key international economies have experienced and may in the future experience significant economic and market changes and downturns in which economic activity is impacted by falling demand for a variety of goods and services, restricted credit, poor liquidity, reduced corporate profitability, volatility in credit, equity, and foreign exchange markets, inflation, bankruptcies, new or increased trade barriers, and overall uncertainty with respect to the economy. These economic conditions can arise suddenly and the full impact of such conditions are impossible to predict. In addition, geopolitical and domestic political developments, such as certain ongoing global geopolitical conflicts, changes in government spending levels, government shut downs and changes in immigration policy impacting the availability of qualified employees for the SMBs we serve, can increase levels of political and economic unpredictability globally and increase the volatility of global financial markets. Moreover, we may be impacted by any turmoil in the global banking system. For example, in March 2023, Silicon Valley Bank (SVB) was closed by the California Department of Financial Protection and Innovation, which appointed the FDIC as receiver. First-Citizens Bank & Trust Company then assumed all of SVB’s customer deposits and certain other liabilities and acquired substantially all of SVB’s loans and certain other assets from the FDIC. While the closure of SVB did not have a material direct impact on our business, instability (either actual or perceived) in the global banking system may result in additional bank failures, as well as volatility of global financial markets, either of which may adversely impact our business and financial condition.

•our ability to retain and expand our relationships with our accounting firm partners, financial institution partners and software provider partners, or to identify and attract new partners;

•our ability to build and deploy AI-powered solutions and drive customer adoption of such solutions, as well as the amount and timing of the associated research and development expenses;

•general economic, market, credit and liquidity conditions, both domestically and internationally, such as inflation, high interest rate and recessionary environments, government budget cuts and government shut downs, tariffs, and actual or perceived instability in the U.S. and global banking systems, as well as economic conditions specifically affecting SMBs or the industries in which our customers participate;

Any of these and other factors, or the cumulative effect of some of these factors, may cause our operating results to vary significantly. In addition, we expect to continue to incur significant additional expenses due to the costs of operating as a public company. If our operating results fall below the expectations of investors and securities analysts who follow our stock, the price of our common stock could decline substantially, and we could face costly lawsuits, including securities class action suits.

We rely upon our marketing strategy of offering risk-free trials of our platform and other digital marketing strategies to generate sales opportunities. Many of our customers start a risk-free trial of our service. Converting these trial customers to paid customers often requires extensive follow-up and engagement. Many prospective customers never convert from the trial version of a product to a paid version of a product. Further, we often depend on the ability of individuals within an organization who initiate the trial versions of our products to convince decision makers within their organization to convert to a paid version. To the extent that these users do not become, or are unable to convince others to become, paying customers, we will not realize the intended benefits of this marketing strategy, and our ability to grow our revenue will be adversely affected. Similarly, our recently-introduced BILL Cash Accounts, which offer high-yield returns on customer cash deposited into such accounts, among other features, require expenditures by us. In the event BILL Cash Account holders do not utilize our platform's product offerings more broadly, our operating results could be adversely affected. In addition, it may be necessary to engage in more sophisticated and costly sales and marketing efforts in order to attract new customers, and changes in privacy laws and third party practices may make adding new customers more expensive or difficult. As a result of these and other factors, we may be unable to attract new customers or our related expenses may increase, which would have an adverse effect on our business, revenue, gross margins, and operating results.

Finally, we seek to accelerate our growth by partnering with businesses to offer embedded payment solutions directly through such partners’ platforms. We previously announced the launch of several Embed 2.0 partnerships, including with Paychex, Oracle NetSuite and Acumatica. Such partnerships may require significant investment and personnel resources to build, customize and enable. If our strategy to offer embedded solutions does not lead to the customer acquisition we anticipate, or on the timeline we envision, our business, operating results and financial condition could be adversely affected.

We offer our BILL Divvy Card as a credit product to a wide range of businesses in the U.S., and the success of this product depends on our ability to effectively manage related risks. The credit decision-making process for our BILL Divvy Cards uses techniques designed to analyze the credit risk of specific businesses based on, among other factors, their past purchase and transaction history, as well as their credit scores. Similarly, proprietary risk models and other indicators are applied to assess current or prospective spending businesses who desire to use our cards to help predict their ability to repay. These risk models may not accurately predict creditworthiness due to inaccurate assumptions, including assumptions related to the particular spending business, market conditions, economic environment, or limited transaction history or other data, among other factors. The accuracy of these risk models and the ability to manage credit risk related to our cards may also be affected by legal or regulatory requirements, competitors’ actions, changes in consumer behavior, changes in the economic environment, policies of our card-issuing partner banks (Issuing Banks,Banks), and other factors.

For a substantial majority of extensions of credit to BILL Spend and Expense spending businesses facilitated through our spend and expense management platform, we purchase from the Issuing Banks participation interests in the accounts receivables generated when spending businesses make purchases using BILL Divvy Cards, and we bear the entire credit risk in the event that a spending business fails to pay card balances. Like other businesses with significant exposure to losses from credit, we face the risk that spending businesses will default on their payment obligations, creating the risk of potential charge-offs. The non-payment rate among spending businesses may increase due to, among other factors, changes to underwriting standards, risk models not accurately predicting the creditworthiness of a business, or a decline in economic conditions, such as a recession, high inflationinflation, government shut downs or government austerity programs. Spending businesses who miss payments may fail to repay their outstanding statement balances, and spending businesses who file for protection under the bankruptcy laws generally do not repay their outstanding balances. If collection efforts on overdue card balances are ineffective or unsuccessful, we may incur financial losses or lose the confidence of our funding sources. In addition, we have in the past and may in the future tighten our credit requirements for customer or vendor eligibility for such solutions, which may limit the growth and profitability of these solutions or result in customer attrition. We do not file UCC liens or take other security interests on BILL Divvy Card balances, which significantly reduces our ability to collect amounts outstanding from spending businesses that file for bankruptcy protection. Any such losses or failures of our risk models could harm our business, operating results, and financial condition. Non-performance, or even significant underperformance, of the account receivables participation interests that we own could have an adverse effect on our business.

We also offer invoice financing whereby, through a relationship with a third-party bank, we extend credit to customers and vendors of our customers, enabling them to finance outstanding invoices. Invoices are typically repaid within a short period, but those that remain outstanding beyond a defined term are assessed interestinterest, and,and in some cases,we may incur losses. Although this and our other credit offerings, such as instant transfer, are only available to customers that satisfy specific credit eligibility criteria, the credit and risk models we use to determine eligibility may be insufficient. Any failure of our credit or risk models to predict creditworthiness, or any increase in default rates for our credit products, could cause us to incur significant losses and harm our business, operating results, and financial condition.

Our risk management efforts may not be effective to prevent fraudulent activities by our customers, subscribers, spending businesses, or their counterparties, or other third parties whichwhich, potentially augmented by AI, could expose us to material financial losses and liabilities and otherwise harm our business.

We offer software that digitizes and automates financial operations for a large number of customers and executes payments to their vendors or from their clients. We are responsible for verifying the identity of our customers and their users, and monitoring transactions for fraud. We have been in the past and will continue to be targeted by parties who seek to commit acts of financial fraud using stolen identities and bank accounts, compromised business email accounts, employee or insider fraud, account takeover, false applications, check fraud, and stolen cards or card account numbers. We may suffer losses from acts of financial fraud committed by our customers and their users, our employees, or third-parties.third parties. In addition, our customers or spending businesses may suffer losses from acts of financial fraud by third parties posing as our company through account takeover, credential harvesting, use of stolen identities, and various other techniques, which could harm our reputation or prompt us to reimburse our customers for such losses in order to maintain customer and spending business relationships. Finally, we are dependent to a certain degree upon the fraud controls implemented by our card-issuing bank and processing partners in connection with our BILL Spend and Expense products, but bear the risk of fraud losses under such partnerships. Accordingly, we may at times experience losses related to these products due to fraudulent activity with limited ability to directly strengthen relevant controls.

The techniques that may be used to perpetrate fraud on our platform are continually evolving, and we expend considerable resources to continue to monitor and combat them. The recent and widespread adoption of AI tools increases the risk of fraudulent activity or other incidents instigated by malicious third parties on our platform and on those of our partners. In addition, when we introduce new products and functionality, or expand existing products, we may not be able to identify all risks created by such new products or functionality. Our risk management policies, procedures, techniques, and processes may not be sufficient to identify all of the risks to which we are exposed, to enable us to prevent or mitigate the risks we have identified, or to identify additional risks to which we may become subject in the future. Our risk managementSuch policies, procedures, techniques, and processes may also contain errors, or our employees or agents may commit mistakes or errors in judgment as a result of which we may suffer large financial losses. The software-driven and highly automated nature of our platform could enable criminals and those committing fraud to steal significant amounts of money from businesses like ours.

Our current business and anticipated growth will continue to place significant demands on our risk management efforts, and we will need to continue developing and improving our existing risk management infrastructure, policies, procedures, techniques, and processes. As techniques used to perpetrate fraud on our platform evolve,become more sophisticated with the use of AI, our teams must similarly evolve to combat such techniques, and we may need to modify our products or services to mitigate fraud risks. As our business grows and becomes more complex, we may be less able to forecast and carry appropriate reserves in our books for fraud relatedfraud-related losses.

The market for cloud-based software that automates the financial back-office is highly fragmented, competitive, and constantlyrapidly evolving.evolving, particularly in light of recent advances in AI. We believe that our primary competition remains the legacy manual processes that SMBs have relied on for generations. Our success will depend, to a substantial extent, on the widespread adoption of our cloud-basedAI-powered automated back-office solutionsolutions as an alternativealternatives to existing solutions or adoption by customers that are not using any such solutions at all. Some organizations may be reluctant or unwilling to use our platform for several reasons, including concerns about additional costs, uncertainty regarding the reliability and security of cloud-based offerings, or lack of awareness of the benefits of our platform. Our competitors in the cloud-basedpayments software space range from large corporations that predominantly focus on enterprise resource planning solutions, to smaller niche suppliers of solutions that focus exclusively on document management, workflow management, accounts payable, accounts receivable, spend and expense management, and/or electronic bill presentment and payment, to companies that offer industry-specific payments solutions. With the introduction of new technologies and market entrants, including AI-native firms, we expect that the competitive environment will remain intense going forward. Our competitors that currently focus on enterprise solutions may offer products to SMBs that compete with ours. In addition, companies that provide solutions that are adjacent to our products and services may decide to enter our market segments and develop and offer products that compete with ours. Software providers, such as Intuit, as well as the financial institutions with which we partner, may internally develop products, acquire existing, third-party products, or may enter into partnerships or other strategic relationships that would enable them to expand their product offerings to compete with our platform or provide more comprehensive offerings than they individually had offered or achieve greater economies of scale than us. These software providers and financial institutions may have the operating flexibility to bundle competing solutions with other offerings, including offering them at a lower price or for no additional cost to customers as part of a larger sale. For example, in October 2023, Intuit launched a native bill payment solution with integration to its QuickBooks accounting software. In addition, BrexBrex, recently acquired by Capital One, and Ramp, firms primarily known for offering spend and expense management products, introduced bill payment products in recent periods. While we believe our platform offers much greater functionality than these products, there can be no assurance that QuickBooks customers will not opt to change providers for certain accounts payable services in the future, or that our ability to win, retain and expand our footprint with BILL Divvy Card customersspending business will not be challenged by these competing offerings. In addition, new entrants not currently considered to be competitors may enter the market through acquisitions, partnerships, or strategic relationships. Many of our competitors and potential competitors have greater name recognition, longer operating histories, more established customer relationships, larger marketing budgets, and greater resources than us. Our competitors may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards, and customer requirements. Certain competitors may also have long-standing exclusive, or nearly exclusive, relationships with financial services provider partners to accept payment cards and other services that compete with what we offer. As we look to market and sell our platform to potential customers, spending businesses, or partners with existing solutions, we must convince their internal stakeholders that our platform is superior to their current solutions.

•easeability ofto integrationintegrate with leading accounting and banking technology infrastructures;

•risk management, exception process handling, and regulatory compliance leadershipleadership, as evidenced by our money transmitter licenses in all required U.S. jurisdictions and in Canada;

As of June 30, 2025,2026, we had approximately 493,800479,300 businesses using our solutions and TPV processed was approximately $329.8$371.3 billion, $292.4$329.8 billion, and $266.0$292.4 billion during fiscal 2026, 2025, 2024, and 2023,2024, respectively. We have grown rapidly to considerable scale and seek to continue this growth. Accordingly, although we have developed and scaled robust and multi-faceted risk management and compliance processes, our business, which is highly complex, is always subject to the risk of financial losses as a result of credit losses, operational errors, software defects, service disruption, employee misconduct, security breaches, or other similar actions or errors on our platform.

We invest funds that we hold for the benefit of our customers, including funds being remitted to suppliers, in highly liquid, investment-grade marketable securities, money market securities, and other cash equivalents. Nevertheless, our customer fund assets are subject to general market, interest rate, credit, foreign exchange, and liquidity risks. These risks may be exacerbated, individually or in the aggregate, during periods of heavy financial market volatility, such as that experienced in 2008 and 2022, that may result from inflation, high interest rate or recessionary environments, from actual or perceived instability in the U.S. and global banking systems, or from war (such as the ongoing conflict in Ukraine and recent developments in the Middle East) or other geopolitical conflicts. As a result, we could be faced with a severe constriction of the availability of liquidity, which could impact our ability to fulfill our obligations to move customer money to its intended recipient. For example, while the sudden closure of SVB in March 2023 did not have a material direct impact on our business, it introduced a potential risk of loss because we held certain corporate and customer funds at SVB. Although we were able to move substantially all such funds to large multinational financial institutions and to redirect substantially all customer payment processing previously made through SVB to one of our multinational bank processors, there can be no assurance that we would be able to do so in the future in the event of a similar or more severe, systemic banking crisis. In addition, cash held at banks and financial institutions is subject to applicable deposit insurance limits, and in the event that our corporate or customer funds held at a given institution exceed such limits, or are held in investments that are not covered by deposit insurance, such funds may be unrecoverable in the event of a future bank failure.

We are licensed as a money transmitter in all required U.S. states and registered as a Money Services Business with FinCEN. In certain jurisdictions where we operate, we are required to hold eligible liquid assets, as defined by the relevant regulators in each jurisdiction, equal to at least 100% of the aggregate amount of all customer balances. Our ability to manage and accurately account for the assets underlying our customer funds and comply with applicable liquid asset requirements requires a high level of internal controls. As our business continues to grow and we expand our product offerings, we will need to scale these associated internal controls. Our success requires significant public confidence in our ability to properly manage our customers’ balances and handle large and growing transaction volumes and amounts of customer funds. Any failure to maintain the necessary controls or to accurately manage our customer funds and the assets underlying our customer funds in compliance with applicable regulatory requirements could result in reputational harm, lead customers to discontinue or reduce their use of our products, and result in significant penalties and fines, possibly including the loss of our state money transmitter licenses, which would materially harm our business.

Our business depends, in part, on our business relationships with accounting firms, financial institutions.institutions, software providers and other partners.

WeIn enteraddition, intowe partneringhave relationshipspartnered with financial institutions pursuantand Embed 2.0 partners to which they offer our products and services to their customers. These relationships involve risks that may not be present or that are present to a lesser extent with sales to our direct SMB customers. Launching a product offering with our financial institution or Embed 2.0 partners entails integrating our platform with our partners’ websites and apps, which requires significant engineering resources and time to design, deploy, and maintain, and requires developing associated sales and marketing strategies and programs. With financial institution partners, the decision to roll out our product offering typically requires several levels of management and technical personnel approval by our partners and is frequently subject to budget constraints. Delays in decision making, unplanned budget constraints, or changes in our partners’ business, business priorities, or internal resource allocations may result in significant delays to the deployment of our platform and its availability to their customers. Significant delays in the deployment of our platform to our partners’ customers could cause us to incur significant expenditures for platform integration and product launch without generating anticipated revenue in the same period or at all and could adversely impact our operating results. In addition, once we have successfully launched a product offering with a financial institution or Embed 2.0 partner, lower than anticipated customer adoption or unanticipated ongoing system integration costs could result in lower than anticipated profit margins, which could have an adverse impact on our business, financial position, and operating results. Moreover, if our partners or their customers experience problems with the operation of our platform, such as service outages or interruptions or security breaches or incidents, our relationship with the partner and our reputation could be harmed and our operating results may suffer.

Finally, we are subject to oversight by ourcertain financial institution partnersinstitutions and they conduct audits of our operations, information security controls, and compliance controls. To the extent an audit were to identify material gaps or evidence of noncompliance in our operations or controls it could violate contractual terms with the financial institutioninstitution, partner, whichand could materially and adversely impact our commercialbusiness relationships with that partner.operations.

•manage the effects of macroeconomic conditions, including economic downturns or recessions, inflation, significant political and regulatory developments or changes in trade policy, including government budget cuts, government shut downs and tariffs, fluctuations in market interest rates and currency exchange rates, and actual or perceived instability in the U.S. and global banking systems on our business and operations and the impacts of globalongoing geopolitical conflicts;

The extensions of credit facilitated through our BILL Spend and Expense offering and certain of our accounts payable offerings are originated through our Issuing Banks, which currently include Cross River Bank, WEX Bank and Web Bank.WebBank. There has been significant recent U.S. Congressional and federal administrative agency lawmaking and ruling in the area of program agreements between banks and non-banks involving extensions of credit and the regulatory environment in this area remains unsettled. There has also been significant recent government enforcement and litigation challenging the validity of such arrangements, including disputes seeking to re-characterize lending transactions on the basis that the non-bank party rather than the bank is the “true lender” or “de facto lender”. If the legal structure underlying these bank partnerships or the extensions of credit thereunder were to be successfully challenged on these or other grounds, our ability to offer our credit products on favorable terms or at all may be adversely affected. In addition, certain banks engaged in similar partnerships and activities have been subject to increased regulatory scrutiny. Adverse orders or regulatory enforcement actions against one or more of the Issuing Banks, even if unrelated to our business, could impose restrictions on such Issuing Banks’ ability to continue to extend credit through our platform or on current terms, or could result in the Issuing Banks increasing their oversight or imposing tighter controls over our underwriting practices or compliance procedures or subjecting any new products to be offered by an Issuing Bank to more rigorous reviews.

The Issuing Banks are subject to oversight by the FDIC and state banking regulators and must comply with applicable federal and state banking laws, regulations, and examination requirements. We, in turn, are subject to audit by the Issuing Banks in accordance with FDIC guidance related to management of service providers and other bank-specific requirements pursuant to the terms of our agreements with the Issuing Banks. If we fail to comply with requirements applicable to us by law or contract, or if third-party audits by the Issuing Banks or regulatory examinations of the Issuing BanksBanks, were to conclude that our processes and procedures are insufficient, we may be subject to increased costs or indirect fines or penalties, and the Issuing Banks could terminate their relationships with us.

To support the operations and growth of our spend and expense management business, we must maintain a variety of funding arrangements, including "warehouse facilities," which provide for an aggregate of $600.0 million in borrowing capacity pursuant to our 2021 Credit Facility and 2025 Credit Facility (together with the 2021 Credit Facility, the Revolving Credit Facilities),Facilities, as described in Note 9 to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K. In particular, we have financing arrangements in place pursuant to which we purchase from the Issuing Banks participation interests in the accounts receivables generated when BILL Spend and Expense spending businesses make purchases using our cards. We typically fund some portion of these participation interest purchases by borrowing under credit facilities with our finance partners, although we mayprimarily alsouse fundcorporate cash to purchase participation purchases using corporate cash.interest.

If our finance partners terminate or interrupt their financing or purchase of participation interests or are unable to offer terms which are acceptable to us, we may have to fund these purchases using corporate cash, which we have a limited ability to do and may place significant stress on our cash resources. An inability to purchase participation interests from the Issuing Banks, whether funded through financing or corporate cash, could result in the banks’ limiting extensions of credit to spending businesses orbusinesses, ceasing to extend credit for our cards altogether,altogether or terminating their program agreements with us, which would interrupt or limit our ability to offer our card products and materially and adversely affect our business.

We use artificial intelligenceAI in our business, and any challenges with successfully developing and deploying new AI tools or properly managing the use of AI could result in reputational harm, competitive harm, and legal liability, and regulatory compliance burdens, and adversely affect our results of operations.

We have incorporated, and expect to continue to incorporate, AI features into our platform and product offerings, and our success will depend in part on our ability to do so in a way that is both compelling to the businesses using our solutions and cost-effective. We currently leverage AI to prepopulate invoices based on the historical behavior of businesses using our solutions and to aid our evaluation of businesses' creditworthiness to offer them and their counterparties expedited means of payment, among other things. MovingIn forward,addition, we willpreviously be launchinglaunched AI agents forto SMBenable payables,automatic receivables,W-9 procurement,collection, receipt reconciliation and cashinvoice management.coding, among other capabilities. In the future, we expect to launch additional agents covering a wide range of services. We have made and expect to continue to make significant investments in developing and deploying our AI technology. There can be no assurances, however, that our development efforts will be successful. Our competitors and other third parties may incorporate AI into their products and offerings more quickly or more successfully than us, which could impair our ability to compete effectively, cause us to lose some or all of our investments in developing these products, and adversely affect our results of operations.

Additionally, if the content, analyses, or recommendations that AI applications assist in producing are, or are alleged to be, inaccurate, deficient, or biased, our business, financial condition, and results of operations may be adversely affected. Furthermore, the integration of third-party AI models with our products and services may rely, in part, on certain safeguards implemented by the third-party developers of the underlying AI models, including those related to the accuracy, bias, and other variables of the data, and these safeguards may be insufficient. The use of AI applications has resulted in, and may in the future result in, cybersecurity incidents that implicate the personal data of customers analyzed within such applications. Any such cybersecurity incidents related to our use of AI applications to analyze personal data could adversely affect our reputation and results of operations. AI also presents emerging ethical issues and if our use of AI becomes controversial, we may experience brand or reputational harm, competitive harm, or legal liability. Legislation that would govern the development or use of AI is under consideration at the federal level and has been enacted or is under consideration in the U.S. at the state and local level, as well as internationally. For example, theseveral U.S. states have enacted AI governance laws that impose transparency, impact assessment, and other requirements on deployers of high-risk AI systems. The EU Artificial Intelligence Act,Act (EU AI Act), which aims to introduce a common regulatory and legal framework for AI, wasbecame officiallyeffective published on July 12, 2024 and came into effect onin August 1, 2024. The EU Artificial IntelligenceAI Act regulates AI providers and entities making use of AI tools in a professional capacity, and may require the implementation of additionalrisk qualitymanagement assurancesystems, controlsdata governance measures, human oversight, and measuresother to be reviewedtechnical and approvedorganizational bymeasures, regulatorydepending submissionson the risk classification of ourthe products.AI system. Our ability to use AI and machine learning may be constrained by current or future laws, regulatory or self-regulatory requirements. The rapid evolution of AI, including potential government regulation of AI and its various uses, will require significant resources to develop, test and maintain our platform, offerings, services, and features to help us implement AI ethically in order to minimize unintended, harmful impact.

Our success and future growth depend upon the continued services of our management team and other key employees. Our founder and Chief Executive Officer, René Lacerte, and our President and Chief Operating Officer, John Rettig, areis critical to our overall management, as well as the continued development of our products, our partnerships, our culture, our relationships with accounting firms, and our strategy. From time to time, there may be changes in our management team resulting from the hiring or departure of executives and key employees, which could disrupt our business. In addition, we may face challenges retaining senior management of acquired businesses. Our senior management and key employees are employed on an at-will basis. We currently do not have “key person” insurance for any of our employees. Certain of our key employees have been with us for a long period of time and have fully vested stock options or other long-term equity incentives that may become valuable and are publicly tradable. The loss of our founder, or one or more of our senior management, key members of senior management of acquired companies or other key employees could harm our business, and we may not be able to find adequate replacements. We cannot ensure that we will be able to retain the services of any members of our senior management or other key employees or that we would be able to timely replace members of our senior management or other key employees should any of them depart.

Certain of our products, including our BILL Divvy Card and our virtual card products, generate revenue primarily from interchange fees paid by the supplier accepting the cards for purchase transactions. Interchange fees comprise a substantial portion of our total revenue. The amount of interchange fees we earn is highly dependent upon the interchange rates set by the third-party card networks and, from time to time, card networks change the interchange fees and assessments they charge for transactions processed using their networks. Significant changes to interchange fee rates, including as a result of card program modifications, could materially impact our revenue and the profitability of our card payment products. In addition, interchange fees are the subject of intense legal and regulatory scrutiny and competitive pressures in the electronic payments industry. For example, in March 2024, Visa and Mastercard reached a proposed settlement to pending antitrust litigation, that would have provided savings to merchants by reducing interchange fees on card transactions by setting a five year cap on interchange fee rates and permitting merchants to pass along surcharges for credit card use to cardholders or reject cards altogether, among other changes. This proposed settlement was subsequently rejected by the court in June 2024 and the matter may proceed to trial. While the impact of this litigation on our business remains unclear, any restrictions imposed by a judgment of the court or one or more new settlements may reduce the amount of interchange fees we receive from transactions using our card products, which could negatively impact our revenues. In addition, if customers are deterred or prevented from using our card products as a result of merchant policies, new surcharges or reduced attractiveness of rewards programs, our business, financial condition, and operating results could be adversely impacted.

We are required to comply with the Mastercard, American Express, and Visa payment card network operating rules applicable to our card products. We have agreed to reimburse certain service providers for any fines they are assessed by payment card networks as a result of any rule violations by us. We may also be directly liable to the payment card networks for rule violations. The payment card networks set and interpret the card operating rules. The payment card networks could adopt new operating rules orrules, interpret or reinterpret existing rules that we or our processors might find difficult or even impossible to follow, or costly to implement.implement, or modify existing programs to reduce the interchange fees we receive from our card products. We also may seek to introduce other card-related products in the future, which would entail compliance with additional operating rules. As a result of any violations of rules, new rules being implemented, or increased fees, we could be hindered or lose our ability to provide our card products, which would adversely affect our business. In addition, we are contractually obligated to comply with card network rules as a card program manager. As a result of any violations of these rules or new rules being implemented, we could lose our ability or rights to act as a card program manager.

WeBILL areis the intelligent finance platform trusted by nearly half a leadingmillion financial operations platform for smallbusinesses and midsizetheir accountants to manage, move, and maximize their money. BILL powers businesses ranging from fast-moving startups to growing companies with complex operations. We use artificial intelligence (SMBsAI). Asto adeliver champion of SMBs, we are automating the future ofstrategic finance socapabilities businessesin can thrive. Ourone integrated platform helpsthat businessesincludes toaccounts payable (AP), accounts receivable (AR), expenses, forecasting, procurement, and more. With more efficientlythan control9 theirmillion payables,network receivables,members, andour spendplatform's andtotal expensepayment management.volume Hundredsrepresents over 1% of thousandsU.S. ofgross businessesdomestic rely on BILL’s proprietary network of millions of members to pay or get paid faster.product. Headquartered in San Jose, California, weBILL areis a trusted partner of leading U.S. financial institutions, accounting firms, and software providers.

Our purpose-built, artificial intelligence (AI)-enabled financial software platform creates seamless connections between our customers, their suppliers, and their clients. Businesses on our platform generate and process invoices, streamline approvals, make and receive payments, manage employee expenses, sync with their accounting system, foster collaboration, and manage their cash flow. We have built sophisticated integrations with popular software solutions, banks, card issuers, and payment processors, enabling our customers to access these mission-critical services quickly and easily. Our integrated platform also includes BILL Spend and Expense, our spend and expense management product, which provides a solution for businesses to have smart corporatecharge cards, build and monitor budgets, manage payments, and eliminate the need for manual expense reports.

We efficiently reach SMBs through our proven direct and indirect go-to-market strategies. We acquire new businesses to use our solutions directly through digital marketing and inside sales, and indirectly through accounting firms, financial institution partnerships and software providers. As of June 30, 2025,2026, our partners included some of the most trusted brands in the financial services business,business includingand more than 85 of the top 100 accounting firms and six of the top ten largest financial institutions for SMBs in the United States (U.S.), including JPMorgan Chase, Bank of America, Wells Fargo Bank, and American Express.firms. As we add customers and partners, we expect our network to continue to grow organically.

We have grown rapidlysignificantly and scaled our business operations in recent periods.years. Our revenue was $1.5$1.7 billion and $1.3$1.5 billion during fiscal 20252026 and 2024,2025, respectively, a year-over-year increase of $172.4$190.6 million. We generated net loss of $11.2 million and net income of $23.8 million and net loss of $28.9 million during fiscal 20252026 and 2024,2025, respectively.

Current macroeconomic conditions and uncertainties, including volatility in interest rates and borrowing costs, inflation and currency exchange rates, the impact of the ongoing rapid development and adoption of new AI capabilities, ongoing geopolitical conflicts and related supply chain disruptions, increases in the cost of memory, computing power, and related raw materials, and recent changes in international trading relationships, supply chains and U.S. and foreign tariff rates have impacted and could continue to impact our business and the SMBs we serve. SMBs are particularly susceptible to changes in overall economic and financial conditions, and certain SMBs may, in the event of adverse economic conditions or a recession or any inability to access financingfinancing, moderate their expenditures, shift to lower-cost methods of payment, or cease operations entirely. For example, in fiscal 2025, we observed certain BILL AP/AR customers reduce their spending, resulting in a reduced TPV per customer. Reductions in interest rates by the U.S. Federal Reserve Bank may improve financial conditions for SMBs, but there can be no assurance of future rate cuts or any corresponding increase in economic activity. At the same time, such reductions in interest rates have the effect of reducing the interest on funds held for customers we generate. We intend to continue to monitor macroeconomic conditions closely and to take appropriate financial or operational actions in response to such conditions.

Any of these conditions or actions may have a negative impact on our future results of operations, liquidity, and financial condition. We are unable to predict the full impact that macroeconomic factors, banking sector dynamics, or ongoing global geopolitical conflicts will have on our future results of operations, liquidity, and financial condition due to numerous uncertainties, including government budget cuts and government shut downs, changes in central bank policies and interest rates, rates of inflation, the strength of the U.S. dollar, the related impact to our customers, spending businesses, subscribers, partners, and suppliers, and other factors described in the section titled “Risk Factors” in Part I, Item 1A of this Annual Report on Form 10-K.

Our subscription revenue is primarily based on a fixed monthly or annual rate per user or per customer account. Our transaction revenue consists of transaction fees and interchange fees on a fixed or variable rate per transaction.transaction, and interchange fees. Transactions primarily include card payments, real-time payments, check payments, ACH payments, cross-border payments, pay-by-card, invoice financing, and creation of invoices. Much of our revenue comes from repeat transactions, which are an important contributor to our recurring revenue.

We market our BILL Spend and Expense software and BILL Divvy Card, a charge card for business expenses,credit and expense management, to potential spending businesses and issue business-purpose charge cards through our card issuing partner banks (Issuing Banks). When a business applies for a BILL Divvy Card, we utilize, on behalf of the Issuing Bank, proprietary risk management capabilities to confirm the identity of the business, and perform a credit underwriting process to determine if the business is eligible for a BILL Divvy Card pursuant to our credit policies. Once approved for a BILL Divvy CardCard, the spending business is provided a credit limit and can use the BILL Spend and Expense software to request virtual cards or physical cards, establish budgets, and manage spend.

The majority of cards on our platform are issued by Cross River Bank, a Federal Deposit Insurance Corporation (FDIC)-insured New Jersey state chartered bank, and WEX Bank,Bank anand WebBank, FDIC-insured Utah state chartered bank.banks. Under our arrangements with the Issuing Banks, we must comply with their respective credit policies and underwriting procedures, and the Issuing Banks maintain ultimate authority to decide whether to issue a card or approve a transaction. We are responsible for all fraud and unauthorized use of a card and generally are required to hold the Issuing Bank harmless from such losses unless claims regarding fraud or unauthorized use are due to the sole gross negligence of the Issuing Bank.

In order to ensure we have the operational flexibility and liquidity to purchase the participation rights in the receivables, we maintain certain funding arrangements, including warehouse facilities. We typically fund some portion of these participation interest purchases by borrowing under our credit facilities, although we may also fundmost purchases are funded using corporate cash.

Our net dollar-based retention rate was 95%, 94%, 92%, and 111%92% during fiscal 2026, 2025, and 2024, respectively. The increase in fiscal 2026 when compared to fiscal 2025 was primarily due to increased revenue from businesses associated with financial institution partners and 2023,the respectively.impact of pricing changes on existing customers. The increase in fiscal 2025 when compared to fiscal 2024 was primarily due to increased revenue from businesses associated with financial institution partners and growth in total payment volume. The decrease in fiscal 2024 when compared to fiscal 2023 was primarily due to the change in spending patterns per customer, continued softness in the SMB economic environment, which limited payment monetization, and the migration or churn of certain customers of a bank partner.

To grow revenue from businesses using our solutions, we must deliver a product experience that helps them automate their back-office financial operations. The more they use and rely upon our product offerings to automate their operations, the more transactions they process on our platform. This metric provides an important indication of the aggregate value of transactions that businesses using our solutions are completing on our platform and is an indicator of our ability to generate revenue from businesses using our solutions. We define TPV as the total value of transactions that we process on our platform during a particular period, comprising transactions from BILL AP/AR customers, BILL Divvy Card transactions, and transactions executed by Embedded Solutions and Other customers. Our calculation of TPV is presented gross of payments that may be subsequently reversed. Such reversals comprisedaccounted for less than 2% of TPV during each of fiscal 2026, 2025, 2024, and 2023.2024.

Service costs – Service costs consist primarily of costs that are directly attributed to processing customers’ and spending businesses' transactions (such as the cost of printing checks, postage for mailing checks, fees associated with the issuance and processing of card transactions, net of card network incentives, and fees for processing payments), personnel-related costs, including stock-based compensation,compensation expenses, for our customer success and payment operations teams, outsourced support services for our customer success team, direct and amortized costs for implementing and integrating our cloud-based platform intowith our customers’ systems, and cloud payments infrastructure costs. We expect that service costs will increase in absolute dollars, but may fluctuate as a percentage of revenue from period to period, as we continue to invest in growing our business and based on whether or not we are the principal or the agent under arrangements with third parties.

Research and development (R&D) – R&D expenses consist primarily of personnel-related expenses, including stock-based compensation expenses, for our R&D teams, incurred in developing new products or enhancing existing products, and allocated overhead costs. We expense a substantial portion of R&D expenses as incurred. We believe that delivering new and enhanced functionality is critical to attract new customers and expand our relationship with existing customers. We expect to continue to make investments in and expand our offerings to enhance our customers’ experience and satisfaction, and to attract new customers. We expect our R&D expenses to increase in absolute dollars, but they may fluctuate as a percentage of revenue from period to period as we expand our R&D team to develop new products and product enhancements, including continued investments in our artificial intelligenceAI tools and offerings, such as AI agents. We capitalize certain internal-use software development costs that are attributable to developing new products and adding incremental functionality to our platform and amortize such costs into service costs over the estimated life of the new product or incremental functionality, which is generally three years.

General and administrative – General and administrative expenses consist primarily of personnel-related expenses, including stock-based compensation expenses, for finance, corporate business operations, risk management, legal and compliance, human resources, and information technology,technology functions, costs incurred for external professional services, losses from fraud, and allocated overhead costs. We expect to incur additional general and administrative expenses as we explore various growth initiatives, which include incurring higher costs for professional services. We also expect to increase the size of our general and administrative functions to support the growth in our business. As a result, we expect that our general and administrative expenses will increase in absolute dollars but may fluctuate as a percentage of revenue from period to period.

Provision for expected credit losses – Provision for expected credit losses represents the amount of expense required to maintain the allowance for expected credit losses on our consolidated balance sheets, which represents management’s estimate of expected credit losses. In the event that our receivables outperform expectation and/or we reduce our expectation of credit losses in future periods, we may release reserves and thereby reduce the provision for expected credit losses. The provision is determined based on our estimate of expected credit losses on acquired cardscard receivables, loans held for investment and accounts receivable on our balance sheets, changes in our estimate of expected credit losses on receivables outstanding and loans held for investment as of the end of the period and the net charge-offs incurred in the period.

Depreciation and amortization – Depreciation and amortization consistconsists of depreciation and amortization of property and equipment, and amortization of acquired intangibles, such as developed technology, and customer relationship, and trade names.relationships. Amortization of capitalized internal-use software costs paid in cash areis excluded.

Restructuring – Restructuring costs consist primarily of employee severance and other employment termination benefits,benefits includingrelated commission,to andthe stock-based compensation expense.RIFs. Additionally, these costs include contract termination expenses and other costs related to the execution of our restructuringefforts planto announcedimprove onorganizational December 5, 2023, which included a reduction in force (RIF)agility and closureefficiency, ofwhile ouralso officeseeking into Sydney,drive Australiagreater (Restructuring Plan).profitability. Refer to Note 15 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information on the Restructuring Plan.information.

Other income, net – Other income, net consistconsists primarily of interest income on our corporate funds, gain on debt extinguishment and interest expense on our borrowings (including amortization of debt discount and issuance costs).

Provision for income taxes – Income tax expense consistconsists of U.S. federal, state and foreign income taxes. We maintain a full valuation allowance against our U.S. federal, state and Australian net deferred tax assets as we have concluded that it is more likely than not that we will not realize our net deferred tax assets.

•a $163.1$182.5 million increase in transaction fee revenue primarily due to increased total payment volume driven by the increase in customer adoption of our BILL AP/AR and BILL Spend and Expense products; and

•a $15.0$21.4 million increase in subscription fee revenue primarily due to an increase in BILL AP/AR customers as compared to the same prior year period; offset by

(1) Consists of depreciation of property and equipment and amortization of developed technology, excluding amortization of capitalized internal-use software costs paid in cash.cash of $31.3 million, $14.5 million, and $9.4 million during each of the years ended June 30, 2026, 2025, and 2024, respectively, which are included in service costs in the consolidated statements of operations.

•a $36.6$21.1 million increase in direct costs associated with the processing of our customers’customers' payment transactions,transactions and data hosting services, which waswere driven by the increase in the number of customers, increasedcustomer adoption of newour product offerings, and an increase in the volume of transactionsproducts; and

•a $2.4$21.0 million increase in temporaryother contractors,costs, andprimarily $3.9from a $16.8 million increase in sharedamortization overheadof capitalized internal-use software costs and a $4.6 million increase in software licenses and subscriptions; offset by

•a $3.2$5.2 million decrease in personnel-related costs dueincluding tostock-based compensation expense, primarily driven by our RIFRIFs announcedexecuted induring Decemberthe 2023.current fiscal year.

Gross margin decreased to 80.9% during fiscal 2026 from 81.4% during fiscal 2025 from 81.8% during fiscal 2024,2025, primarily due to ahigher changeamortization of capitalized internal-use software costs paid in mixcash, ofpartially costsoffset associatedby withlower processingpersonnel-related ofcosts, payments.including stock-based compensation expense.

Research and development expenses increaseddecreased by $3.3$39.5 million during fiscal 20252026 as compared to fiscal 2024,2025, primarily due to athe $20.9 million increase in personnel-related costs, including stock-based compensation expense, due to increase in headcount, offset by a $18.6 million decrease due to higher capitalization of certain software development costs.following:

•a $52.2$75.6 million increase in rewards expense in connection with our BILL Divvy Cards as a result of increased transaction volume. Rewards expense increased from 48%49% to 49%51% as a percentage of revenue from spend and expense interchange fees primarily due to lowerhigher interchangereward feesrates; relative to total card payment volume;and

•a $6.0$3.0 million increase in advertising,advertising spend, marketing initiatives, and software subscription expensesexpenses, and shared overhead; andoffset by

•a $6.7$13.0 million decreaseincrease in professional and consulting fees for outside services.services, including fees related to shareholders' activism; and

Depreciation and amortization decreasedincreased by $18.9$7.7 million during fiscal 20252026 as compared to fiscal 2024,2025, primarily due to certainhigher fully amortized intangible assets asamortization of thecapitalized beginninginternal-use ofsoftware costs during the current fiscal year.

Restructuring expensecharges decreasedincreased by $27.6$90.9 million during fiscal 20252026, asfrom compared to fiscal 2024 as the Restructuring Plan announced on December 5, 2023 was substantially completednone in fiscal 2024.2025, due to the RIFs undertaken during the current fiscal year. Refer to Note 15 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information on the Restructuring Plan.information.

•a $4.7$40.6 million decrease due to athe lowerabsence of gain on debt extinguishment resulting from the partial repurchases of our 2025 Notes and 2027 Notes.Notes; and

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together with all of the other information in this Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our condensed consolidated financial statements and the accompanying notes included elsewhere in this Quarterly Report on Form 10-Q before deciding whether to invest in shares of our common stock. AdditionalReferences to past events are provided by way of example only and are not intended to be a complete listing of such events or a representation as to whether or not such factors or similar events have occurred in the past or their likelihood of occurring in the future. Further, additional risks beyond those summarized below or discussed elsewhere in this Quarterly Report on Form 10-Q may apply to our activities or operations as currently conducted or as we may conduct them in the future or in the markets in which we operate or may in the future operate.

•We use artificial intelligenceAI in our business, and any challenges with successfully developing and deploying new AI tools or properly managing the use of AI could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations;

We were incorporated in 2006 and historically have mostly experienced net losses in most periods since inception. We generated net lossincome of $2.6$12.8 million and a net incomeloss of $33.5$11.6 million during the three months ended DecemberMarch 31, 20252026 and 2024,2025, respectively. We generated net lossincome of $5.6$7.2 million and a net income of $42.5$30.9 million during the sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, respectively. As of DecemberMarch 31, 2025,2026, we had an accumulated deficit of $1.7$1.8 billion. While we have experienced significant revenue growth in recent years and achieved profitability on a GAAP basis in certain recent quarters and in our most recent fiscal year, we are not certain whether or when we will generate sufficient revenue to sustainably maintain or enhance our profitability profile in the future. We also expect our costs and expenses to increase in future periods, which could negatively affect our future operating results if our revenue does not increase. In particular, we intend to continue to expend significant funds to further develop our platform, including introducing new products and functionality, drive new customer adoption, and expand partner integrations. Our profitability each quarter is also impacted by the mix of our revenue generated from subscriptions, transaction fees, including the mix of ad valorem transaction revenue, and interest earned on funds that we hold for the benefit of our customers. Any changes in this revenue mix will have the effect of increasing or decreasing our margins. In addition, we offer promotion programs whereby spending businesses that use our spend and expense management product can earn rewards based on transaction volume on our BILL Divvy Cards, and the cost of earned rewards that are redeemed impacts our sales and marketing expenses. Our efforts to grow our business may be costlier than we expect, and we may not be able to increase our revenue enough to offset our increased operating expenses. We may incur significant losses in the future for several reasons, including the other risks described herein, and unforeseen expenses, difficulties, complications, delays, and other unknown events. If we are unable to sustain and expand our profitability, the value of our business and common stock may significantly decrease.

Our overall performance depends in part on U.S. and international macroeconomic conditions and a significant portion of our revenue comes from SMBs. These customers tend to be more susceptible to negative impacts from economic downturns, recession, inflation, increases in interest rates or the cost of borrowing, changes in foreign currency exchange rates, including recent weakness in the U.S. dollar, the impact of the ongoing rapid development and adoption of new AI capabilities, the conflict in Iran and related supply chain disruptions, newly-imposed tariffs by the U.S. and foreign countries and other restrictions on international trade and supply chains,trade, financial market conditions, actual or perceived instability in the U.S. and global banking systems, increased fuel prices, and catastrophic events than larger, more established businesses, as SMBs typically have more limited financial resources than larger entities. In recent periods, we have observed SMBs reacting to the macroeconomic environment by tightening budgets and selecting lower-cost payment methods, which adversely impacted our operating results. In addition, the rate of growth in the number of businesses using our solutions has been and may continue to be impacted by current macroeconomic conditions. Finally, recent reductions in U.S. federal government spending, including in the U.S. Small Business Administration, may adversely impact the SMBs we serve.

•our ability to build and deploy AI-powered solutions and drive customer adoption of such solutions, as well as the amount and timing of the associated research and development expenses;

We recently announced the launch of AI agents to enable automatic W-9 collection, transaction reconciliation and invoice coding, and we plan to launch additional agents in the near-term. The success of these new agentic AI offerings will depend in part on our ability to deliver them in a way that is both compelling to our customers and cost-effective, and if new or existing customers do not use our AI agents, our business, operating results and financial condition could be adversely affected, Finally, we seek to accelerate our growth by partnering with businesses to offer embedded payment solutions directly through such partners’ platforms. We previously announced the launch of several such partnerships, including with Paychex, Oracle NetSuite and Acumatica. Such partnerships may require significant investment and personnel resources to build, customize and enable. If our strategy to offer embedded solutions does not lead to the customer acquisition we anticipate, or on the timeline we envision, our business, operating results and financial condition could be adversely affected.

The market for cloud-based software that automates the financial back-office is highly fragmented, competitive, and constantly evolving. We believe that our primary competition remains the legacy manual processes that SMBs have relied on for generations. Our success will depend, to a substantial extent, on the widespread adoption of our cloud-based automated back-office solution as an alternative to existing solutions or adoption by customers that are not using any such solutions at all. Some organizations may be reluctant or unwilling to use our platform for several reasons, including concerns about additional costs, uncertainty regarding the reliability and security of cloud-based offerings, or lack of awareness of the benefits of our platform. Our competitors in the cloud-based software space range from large corporations that predominantly focus on enterprise resource planning solutions, to smaller niche suppliers of solutions that focus exclusively on document management, workflow management, accounts payable, accounts receivable, spend and expense management, and/or electronic bill presentment and payment, to companies that offer industry-specific payments solutions. With the introduction of new technologies and market entrants, including AI-native firms, we expect that the competitive environment will remain intense going forward. Our competitors that currently focus on enterprise solutions may offer products to SMBs that compete with ours. In addition, companies that provide solutions that are adjacent to our products and services may decide to enter our market segments and develop and offer products that compete with ours. Software providers, such as Intuit, as well as the financial institutions with which we partner, may internally develop products, acquire existing, third-party products, or may enter into partnerships or other strategic relationships that would enable them to expand their product offerings to compete with our platform or provide more comprehensive offerings than they individually had offered or achieve greater economies of scale than us. These software providers and financial institutions may have the operating flexibility to bundle competing solutions with other offerings, including offering them at a lower price or for no additional cost to customers as part of a larger sale. For example, in October 2023, Intuit launched a native bill payment solution with integration to its QuickBooks accounting software. In addition, Brex and Ramp, firms primarily known for offering spend and expense management products, introduced bill payment products in recent periods. While we believe our platform offers much greater functionality than these products, there can be no assurance that QuickBooks customers will not opt to change providers for certain accounts payable services in the future, or that our ability to win, retain and expand our footprint with BILL Divvy Card spending business will not be challenged by these competing offerings. Additionally, the rapid development and adoption of AI may further intensify competition, lower barriers to entry, shorten product development cycles, and make certain features and functionality easier for existing or new competitors to replicate or offer at lower cost. Competitors may use AI to enhance their existing offerings, develop and deploy new products more quickly, improve implementation or support or bundle AI-enabled capabilities with broader platforms. Further, customers' expectations regarding automation, accuracy, ease of use, speed of implementation and breadth of workflow coverage may continue to increase as AI capabilities evolve. If we are unable to develop, deploy and maintain AI-powered solutions in a timely and cost-effective manner or if our competitors are more successful in doing so, our ability to attract and retain customers could be adversely affected. In addition, new entrants not currently considered to be competitors may enter the market through acquisitions, partnerships, or strategic relationships. Many of our competitors and potential competitors have greater name recognition, longer operating histories, more established customer relationships, larger marketing budgets, and greater resources than us. Our competitors may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards, and customer requirements. Certain competitors may also have long-standing exclusive, or nearly exclusive, relationships with financial services provider partners to accept payment cards and other services that compete with what we offer. As we look to market and sell our platform to potential customers, spending businesses, or partners with existing solutions, we must convince their internal stakeholders that our platform is superior to their current solutions.

As of DecemberMarch 31, 2025,2026, we had approximately 498,500493,800 businesses using our solutions and TPV processed was approximately $95.1$88.7 billion and $84.5$79.4 billion during the three months ended DecemberMarch 31, 20252026 and 2024,2025, respectively, and $184.4$273.1 billion and $164.5$243.7 billion during the sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, respectively. We have grown rapidly to considerable scale and seek to continue this growth. Accordingly, although we have developed and scaled robust and multi-faceted risk management and compliance processes, our business, which is highly complex, is always subject to the risk of financial losses as a result of credit losses, operational errors, software defects, service disruption, employee misconduct, security breaches, or other similar actions or errors on our platform.

We invest funds that we hold for the benefit of our customers, including funds being remitted to suppliers, in highly liquid, investment-grade marketable securities, money market securities, and other cash equivalents. Nevertheless, our customer fund assets are subject to general market, interest rate, credit, foreign exchange, and liquidity risks. These risks may be exacerbated, individually or in the aggregate, during periods of heavy financial market volatility, such as that experienced in 2008 and 2022, that may result from inflation, high interest rate or recessionary environments, from actual or perceived instability in the U.S. and global banking systems, or from war (such as the ongoing conflictconflicts in Ukraine and recent developments in the Middle East) or other geopolitical conflicts. As a result, we could be faced with a severe constriction of the availability of liquidity, which could impact our ability to fulfill our obligations to move customer money to its intended recipient. For example, the sudden closure of SVB in March 2023 introduced a potential risk of loss because we held certain corporate and customer funds at SVB. Although we were able to move substantially all such funds to large multinational financial institutions and to redirect substantially all customer payment processing previously made through SVB to one of our multinational bank processors, there can be no assurance that we would be able to do so in the future in the event of a similar or more severe, systemic banking crisis. In addition, cash held at banks and financial institutions is subject to applicable deposit insurance limits, and in the event that our corporate or customer funds held at a given institution exceed such limits, or are held in investments that are not covered by deposit insurance, such funds may be unrecoverable in the event of a future bank failure.

For the three months ended DecemberMarch 31, 20252026 and 2024,2025, we generated $39.5$35.4 million and $42.9$37.9 million, respectively, in revenue from interest earned on funds held in trust on behalf of customers while payment transactions were clearing, or approximately 10%9% and 12%11% of our total revenue for such periods, respectively. During the sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, we generated $77.3$112.7 million and $86.4$124.4 million, respectively, or approximately 10%9% and 12% of our total revenue for such periods, respectively. While these payments are clearing, we deposit the funds in highly liquid, investment-grade marketable securities, and generate revenue that is correlated to the federal funds rate. As interest rates rose in 2022 and 2023, the amount of revenue we generated from such funds increased. However, interest rates have begun to decline in recent periods, which has caused, and may continue to cause, the amount of revenue we generate from these investments to decrease as well. Additionally, as customers increasingly seek expedited methods of electronic payments, such as instant transfer, or potentially migrate spend to our BILL Divvy Card offering, our revenue from interest earned on customer funds could decrease (even if offset by other revenue) and our operating results could be adversely affected. Finally, in addition to the risks outlined above, any change in laws or applicable regulations that restrict the scope of permissible investments for such customer funds could reduce our interest income and adversely affect our operating results.

Our relationships with our more than 9,5009,600 accounting firm partners contribute a significant portion of our total revenue. We market and sell our products and services through accounting firms, including via "client advisory services" through which the firms manage finances and make payments on behalf of their clients, in each case through our platform. We also have an exclusive partnership with CPA.com to market certain of our products and services to accounting firms, which then enroll their customers directly onto our platform. Although our relationships with accounting firms are independent of one another, if our reputation in the accounting industry more broadly were to suffer, or if we were unable to establish relationships with new accounting firms and grow our relationships with existing accounting firm partners, our growth prospects would weaken and our business, financial position, and operating results may be adversely affected.

Our revenue was $414.7$406.6 million and $362.6$358.2 million during the three months ended DecemberMarch 31, 20252026 and 2024,2025, respectively, and $810.4$1,217.0 million and $721.0$1,079.2 million during the sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, respectively. Our TPV was $95.1$88.7 billion and $84.5$79.4 billion during the three months ended DecemberMarch 31, 20252026 and 2024,2025, respectively, and $184.4$273.1 billion and $164.5$243.7 billion during the sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, respectively. Our rate of revenue growth will fluctuate from period to period, as it depends on a number of factors, including our ability to:

The extensions of credit facilitated through our BILL Spend and Expense offering and certain of our accounts payable offerings are originated through our Issuing Banks, Cross River Bank, WEX Bank and Web Bank.WebBank. There has been significant recent U.S. Congressional and federal administrative agency lawmaking and ruling in the area of program agreements between banks and non-banks involving extensions of credit and the regulatory environment in this area remains unsettled. There has also been significant recent government enforcement and litigation challenging the validity of such arrangements, including disputes seeking to re-characterize lending transactions on the basis that the non-bank party rather than the bank is the “true lender” or “de facto lender”. If the legal structure underlying these bank partnerships or the extensions of credit thereunder were to be successfully challenged on these or other grounds, our ability to offer our credit products on favorable terms or at all may be adversely affected. In addition, certain banks engaged in similar partnerships and activities have been subject to increased regulatory scrutiny. Adverse orders or regulatory enforcement actions against one or more of the Issuing Banks, even if unrelated to our business, could impose restrictions on such Issuing Banks’ ability to continue to extend credit through our platform or on current terms, or could result in the Issuing Banks increasing their oversight or imposing tighter controls over our underwriting practices or compliance procedures or subjecting any new products to be offered by an Issuing Bank to more rigorous reviews.

To support the operations and growth of our spend and expense management business, we must maintain a variety of funding arrangements, including "warehouse facilities," which provide for an aggregate of $600.0 million in borrowing capacity pursuant to our Revolving Credit Facilities, as described in Note 7 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. In particular, we have financing arrangements in place pursuant to which we purchase from the Issuing Banks participation interests in the accounts receivables generated when BILL Spend and Expense spending businesses make purchases using our cards. We typically fund some portion of these participation interest purchases by borrowing under credit facilities with our finance partners, although we mayprimarily alsouse fundcorporate cash to purchase participation purchases using corporate cash.interest.

If our finance partners terminate or interrupt their financing or purchase of participation interests or are unable to offer terms which are acceptable to us, we may have to fund these purchases using corporate cash, which we have a limited ability to do and may place significant stress on our cash resources. An inability to purchase participation interests from the Issuing Banks, whether funded through financing or corporate cash, could result in the banks’ limiting extensions of credit to spending businesses or ceasing to extend credit for our cards altogether, which would interrupt or limit our ability to offer our card products and materially and adversely affect our business.

We use artificial intelligenceAI in our business, and any challenges with successfully developing and deploying new AI tools or properly managing the use of AI could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.

We have incorporated, and expect to continue to incorporate, AI features into our platform and product offerings, and our success will depend in part on our ability to do so in a way that is both compelling to the businesses using our solutions and cost-effective. We leverage AI to prepopulate invoices based on the historical behavior of businesses using our solutions and to aid our evaluation of businesses' creditworthiness to offer them and their counterparties expedited means of payment, among other things. In addition, we previously launched AI agents to enable automatic W-9 collection, receipt reconciliation and invoice coding.coding, among other capabilities. In the future, we expect to launch additional agents covering a wide range of services. We have made and expect to continue to make significant investments in developing and deploying our AI technology. There can be no assurances, however, that our development efforts will be successful. Our competitors and other third parties may incorporate AI into their products and offerings more quickly or more successfully than us, which could impair our ability to compete effectively, cause us to lose some or all of our investments in developing these products, and adversely affect our results of operations.

Our success and future growth depend upon the continued services of our management team and other key employees. Our founder and Chief Executive Officer, René Lacerte, and our President and Chief Operating Officer, John Rettig, areis critical to our overall management, as well as the continued development of our products, our partnerships, our culture, our relationships with accounting firms, and our strategy. From time to time, there may be changes in our management team resulting from the hiring or departure of executives and key employees, which could disrupt our business. In addition, we may face challenges retaining senior management of acquired businesses. Our senior management and key employees are employed on an at-will basis. We currently do not have “key person” insurance for any of our employees. Certain of our key employees have been with us for a long period of time and have fully vested stock options or other long-term equity incentives that may become valuable and are publicly tradable. The loss of our founder, or one or more of our senior management, key members of senior management of acquired companies or other key employees could harm our business, and we may not be able to find adequate replacements. We cannot ensure that we will be able to retain the services of any members of our senior management or other key employees or that we would be able to timely replace members of our senior management or other key employees should any of them depart.

Our reductionreductions in force and restructuring efforts may result in unanticipated costs or consequences.

We are committed to undertaking measures to improve organizational agility and efficiency, while also seeking to drive greater profitability. On October 15, 2025, in furtherance of this commitment, we announced a RIF impacting approximately 6% of employees. In March 2026, we undertook an additional RIF and incurred additional restructuring charges, which are expected to be substantially paid by June 30, 2026. Finally, in May 2026, we announced another RIF expected to impact up to 30% of our workforce. In connection with thesuch RIF,RIFs, we have incurred andor may continueexpect to incur additionalcertain costs in the near term, including cash expenditures related to severance payments, certain retention payments, employee benefits and employee transition costs. The RIFRIFs and other measures we may undertake in connection with our commitment may result in other unintended consequences, including employee attrition beyond our intended reduction in force,RIFs, damage to our corporate culture and decreased employee morale among our remaining employees, diversion of management attention, adverse effects to our reputation as an employer, loss of institutional knowledge and expertise, and potential failure or delays to meet operational and growth targets due to the loss of qualified employees. If we experience any of these adverse consequences, the RIFRIFs and other measures may not achieve their intended benefits, or the benefits, even if achieved, may not be adequate to meet our long-term profitability and operational expectations, which could adversely affect our business, operating results and financial condition.

We have been and may continue to be subject to actions by or proposals from activist stockholders or others that may not align with our business strategies or the interests of our other stockholders. Responding to these actions or proposals can be costly and time consuming, disrupt our business and operations, and divert the attention of our Board of Directors, management and employees. For example, we have been and may be continuedcontinue to retain the services of various professionals to advise us on stockholder activism matters, including legal, financial and communications advisers, the costs of which may negatively impact our future financial results. Activist stockholders may create perceived uncertainties as to our future direction which may be exploited by our competitors and may make it more difficult to attract and retain qualified personnel and potential customers and partners and may affect our relationships with current customers, partners, vendors, investors, and other third parties. In addition, actions of activist stockholders may cause periods of fluctuation in our stock price based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business.

Our success and increased visibility may result in increased regulatory oversight and enforcement and more restrictive rules and regulations that apply to our business. We are subject to a wide variety of local, state, federal, and international laws, rules, regulations, licensing schemes, and industry standards in the U.S. and in other countries in which we operate and in many of the countries in which our subsidiaries Invoice2go, LLC and Cimrid Pty, Ltd (together, Invoice2go) have subscribers. These laws, rules, regulations, licensing schemes, and standards govern numerous areas that are important to our business. In addition to the payments and financial services-related regulations, and the privacy, data protection, and information security-related laws described elsewhere in this "Risk Factors" sectionsection, our business is also subject to, without limitation, rules and regulations applicable to: securities, labor and employment, immigration, competition, and marketing and communications practices. Laws, rules, regulations, licensing schemes, and standards applicable to our business are subject to change and evolving interpretations and application, including by means of legislative changes and/or executive orders, and it can be difficult to predict how they may be applied to our business and the way we conduct our operations, particularly as we introduce new products and services and expand into new jurisdictions. We may not be able to respond quickly or effectively to regulatory, legislative, and other developments, and these changes may in turn impair our ability to offer our existing or planned features, products, and services and/or increase our cost of doing business. For example, the State of California has adopted new climate-related disclosure requirements, and compliance with such rules could require significant effort and resources.

The U.S. federal and various state and foreign governments have adopted or proposed limitations on the collection, distribution, use, and storage of data relating to individuals and businesses, including the use of contact information and other data for marketing, advertising, and other communications with individuals and businesses. In the U.S., various laws and regulations apply to the collection, processing, disclosure, and security of certain types of data, including the Gramm Leach Bliley Act (GLBA) and state laws relating to privacy and data security. GLBA requires financial institutions to explain their information sharing practices to their customers and to safeguard sensitive datadata. Additionally, the FTC and many state attorneys general are interpreting federal and state consumer protection laws as imposing standards for the online collection, use, dissemination, and security of data. For example, the California Consumer Privacy Act (CCPA), which broadly defines personal information, gives California residents expanded privacy rights and protections, including the right to opt out of certain personal information sharing, the use of “sensitive personal information,” and the use of personal information for automated decision-making or targeted advertising and provides for civil penalties for violations and a private right of action for data breaches. Many aspects of the CCPA remain unclear, and its full impact on our business and operations remains uncertain. Following the lead of California, over a third of U.S. states, including Colorado, Virginia, and Texas have enacted laws similar to the CCPA and several other states are considering enacting similarly comprehensive consumer privacy laws as well. Accordingly, the laws and regulations relating to privacy, data protection, and information security are evolving, can be subject to significant change, and may result in ever-increasing regulatory and public scrutiny and escalating levels of enforcement and sanctions.

In addition, several foreign countries and governmental bodies, including the European Union (EU) and the United Kingdom (UK), have laws and regulations dealing with the handling and processing of personal information, which in certain cases are more restrictive than those in the U.S. Laws and regulations in these jurisdictions apply broadly to the collection, use, storage, disclosure, and security of various types of data, including data that identifies or may be used to identify an individual, such as names, email addresses, and , internet protocol addresses. Our current and prospective service offerings subject us to the GDPR, Australian and Canadian privacy laws, and the privacy laws of many other foreign jurisdictions. Such laws and regulations may be modified or subject to new or different interpretations, and new laws and regulations may be enacted in the future.

Any failure or perceived failure by us to comply with laws, regulations, policies, legal,legal or contractual obligations, industry standards, or regulatory guidance relating to privacy, data protection, or information security, may result in governmental investigations and enforcement actions, litigation, fines and penalties, or adverse publicity, and could cause our customers and partners to lose trust in us, which could have an adverse effect on our reputation and business. We expect that there will continue to be new proposed laws, regulations, and industry standards relating to privacy, data protection, information security, marketing, and consumer communications, and we cannot determine the impact such future laws, regulations, and standards may have on our business. Future laws, regulations, standards, and other obligations or any changed interpretation of existing laws or regulations could impair our ability to develop and market new functionality and maintain and grow our customer base and increase revenue. Future restrictions on the collection, use, sharing, or disclosure of data, or additional requirements for express or implied consent of our customers, partners, or users for the use and disclosure of such information could require us to incur additional costs or modify our platform, possibly in a material manner, and could limit our ability to develop new functionality.

Cybersecurity incidents and malicious internet-based activity continue to increase generally, and providers of cloud-based services have frequently been targeted by such attacks. These cybersecurity challenges, including threats to our own information technology infrastructure or those of our customers or third-party providers, may take a variety of forms ranging from stolen bank accounts, business email compromise, customer employee fraud, account takeover, check fraud, or cybersecurity attacks, to “mega breaches” targeted against cloud-based services and other hosted software, which could be initiated by individual or groups of hackers or sophisticated cyber criminals. State-sponsored cybersecurity attacks on the U.S. financial system or U.S. financial service providers could also adversely affect our business.business, including attacks that may be related to recent geopolitical conflicts in Iran and Ukraine or elsewhere. A cybersecurity incident or breach could result in disclosure of confidential information and intellectual property, or cause production downtimes and compromised data. We have in the past experienced cybersecurity incidents of limited scale. We may be unable to anticipate or prevent techniques used in the future to obtain unauthorized access or to sabotage systems because they change frequently and often are not detected until after an incident has occurred. As we increase our customer base and our brand becomes more widely known and recognized, third parties may increasingly seek to compromise our security controls or gain unauthorized access to our sensitive corporate information or our customers’ data.

In the United States, most of our services are subject to anti-money laundering laws and regulations, including the BSA,Bank Secrecy Act (the BSA), the Anti-Money Laundering Act of 2020, and similar state laws and regulations. The BSA requires, among other things, money services businesses (known as MSBs) to develop and implement risk-based anti-money laundering programs, to report suspicious activity, and in some cases, to collect and maintain information about customers who use their services and maintain other transaction records. Regulators in the United States, Canada, and in many other foreign jurisdictions continue to increase their scrutiny of compliance with these obligations, which may require us to further revise or expand our compliance program, including the procedures we use to verify the identity of our customers and to monitor transactions on our system, including payments to persons outside of the U.S. and Canada. Regulators regularly re-examine the transaction volume thresholds at which we must obtain and keep applicable records or verify identities of customers, and any change in such thresholds could result in greater costs for compliance.

As of DecemberMarch 31, 2025,2026, we had outstanding $123.5 million aggregate principal amount of 0% convertible senior notes due April 1, 2027 (the 2027 Notes), and $1.4 billion aggregate principal amount of 0% convertible senior notes due April 1, 2030 (the 2030 Notes, and together with the 2027 Notes, the Notes) and had drawn $330.0 million under our Revolving Credit Facilities, as described in Note 7 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. Our ability to make payments of the principal of, to pay interest on, or to refinance our indebtedness, including the Notes and our Revolving Credit Facilities, depends on our future performance, which is subject to economic, financial, competitive, and other factors beyond our control. Moreover, our obligations under the Revolving Credit Facilities are secured by our BILL Divvy Card receivables and certain other collateral, and subject to a limited guarantee by BILL Holdings, Inc. Our business may not generate cash flow from operations in the future sufficient to service our debt and make necessary capital expenditures. If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt, or obtaining additional debt financing or equity capital on terms that may be onerous or highly dilutive. Our ability to refinance any future indebtedness will depend on the capital markets and our financial condition at such time. We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our debt obligations. In addition, any of our future debt agreements may contain restrictive covenants that may prohibit us from adopting any of these alternatives. Our failure to comply with these covenants could result in an event of default which, if not cured or waived, could result in the acceleration of our debt.

Prior to the close of business on the business day immediately preceding January 1, 2027, in the case of the 2027 Notes, and January 1, 2030, in the case of the 2030 Notes, the holders of the applicable Notes may elect to convert their Notes during any calendar quarter (and only during such calendar quarter) if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day (the Conversion Condition). The Conversion Condition for the 2027 Notes and 2030 Notes was not triggered as of DecemberMarch 31, 2025.2026. In the event the Conversion Condition is triggered for one or more series of Notes, holders of such Notes will be entitled to convert their Notes at any time during specified periods at their option. If one or more holders elect to convert their Notes, unless we elect to satisfy our conversion obligation by delivering solely shares of our common stock (other than paying cash in lieu of delivering any fractional share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity. In addition, even if holders do not elect to convert their Notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the Notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.

In connection with the sale of each of the 2027 Notes and the 2030 Notes, we entered into privately negotiated Capped Call transactions (collectively, the Capped Calls) with certain financial institutions (the option counterparties). The Capped Call transactions are designed to reduce the potential dilution upon conversion of the Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap.

In addition, our amended and restated certificate of incorporation and our second amended and restated bylaws provide that the Court of Chancery of the State of Delaware, to the fullest extent permitted by law, will be the exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a breach of fiduciary duty, any action asserting a claim against us arising pursuant to the Delaware General Corporation Law (the DGCL), our amended and restated certificate of incorporation, or our second amended and restated bylaws, or any action asserting a claim against us that is governed by the internal affairs doctrine. These choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, or other employees, which may discourage lawsuits against us and our directors, officers, and other employees. These exclusive forum provisions will not apply to claims that are vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery of the State of Delaware, or for which the Court of Chancery of the State of Delaware does not have subject matter jurisdiction. For instance, these provisions would not preclude the filing of claims brought to enforce any liability or duty created by the Exchange Act or Securities Act of 1933, as amended (the Securities Act), or the rules and regulations thereunder in federal court.

The market price of our common stock could decline as a result of sales of a large number of shares of our common stock in the market. The perception that these sales might occur may also cause the market price of our common stock to decline. We had a total of 99,966,687 shares of our common stock outstanding as of DecemberMarch 31, 2025.2026. All shares of our common stock are either freely tradable, generally without restrictions or further registration under the Securities Act, or have been registered for resale under the Securities Act by us, subject to certain exceptions for shares held by our “affiliates” as defined in Rule 144 under the Securities Act.

In AugustApril 2025,2026, our board of directors authorized a sharethe repurchase program pursuant to which we announced our intention to repurchaseof up to $300.0$1.0 millionbillion in shares of our outstanding shares of common stockstock, which authorization includes unused amounts under a previously-authorized program. Pursuant to this authorization, we may purchase such shares from time to time, using a variety of methods, through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans, in compliance with the rules of the SEC and other applicable legal requirements. For additional discussion about our share repurchase program activity during the period and shares available for future repurchases, refer to Note 8 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

We efficiently reach SMBs through our proven direct and indirect go-to-market strategies. We acquire new businesses to use our solutions directly through digital marketing and inside sales, and indirectly through accounting firms, financial institution partnerships, and software providers. As of DecemberMarch 31, 2025,2026, our partners included some of the most trusted brands in the financial services business, including more than 85 of the top 100 accounting firms and sixsome of the top ten largest financial institutions for SMBs in the United States (U.S.), including JPMorgan Chase, Bank of America, Wells Fargo Bank, and American Express.. As we add customers and partners, we expect our network to continue to grow organically.

InWe October 2025, werecently launched BILL AI, including our first suite of AI agents, which are designed to autonomously collectsimplify and validateaccelerate W-9sSMB workflows. Examples include W-9 filings, customer support and reconcileassistance, receipts.touchless transactions, automatic reconciliations and complex invoice coding. We launchedhave anenhanced additionalthe agentcapabilities inof Februaryour 2026Supplier Payments Plus product with expanded digital acceptance and anticipategreater launchingcontrol additionalof agents and AI features in the coming months.preferences. In addition, we previously announced embed partnerships with Paychex, Oracle NetSuite, and Acumatica, which we expect will extend our platform's reach and offer new payment capabilities to our partners' users. Finally, we recently launched BILL Travel, our travel management offering, to empower our customers' employees to book trips and track expenses through our platform.

Current macroeconomic conditions and uncertainties, including volatility in interest rates and borrowing costs, inflation and currency exchange rates, the impact of the ongoing rapid development and adoption of new AI capabilities, the conflict in Iran and related supply chain disruptions, and recent changes in international trading relationships, supply chainsrelationships and U.S. and foreign tariff rates have impacted and could continue to impact our business and the SMBs we serve. SMBs are particularly susceptible to changes in overall economic and financial conditions, and certain SMBs may, in the event of adverse economic conditions or a recession or any inability to access financing, moderate their expenditures, shift to lower-cost methods of payment, or cease operations entirely. Reductions in interest rates by the U.S. Federal Reserve Bank may improve financial conditions for SMBs, but there can be no assurance of future rate cuts or any corresponding increase in economic activity. At the same time, such reductions in interest rates have the effect of reducing the interest on funds held for customers we generate. We intend to continue to monitor macroeconomic conditions closely and to take appropriate financial or operational actions in response to such conditions.

We are committed to undertaking measures to improve organizational agility and efficiency, while also seeking to drive greater profitability. On October 15, 2025, inIn furtherance of this commitment, thewe Companyhave undertaken or announced aseveral reductionreductions in force (RIFs) in recent periods, including a RIF) impacting approximately 6% of employees.employees Wein incurredOctober the2025, majoritya of the charges related to thesmaller RIF in theMarch three2026, monthsand, endedin SeptemberMay 30,2026, 2025we andannounced theour intention to execute an additional RIF wasimpacting substantiallyup completedto by30% Decemberof 31,our 2025.workforce. TheWe Company also intendscontinue to consider and pursue additionalappropriate actions to improve structural efficiencies and optimize operations overin thefuture course of the year.periods.

We market our BILL Spend and Expense software and BILL Divvy Card, a charge card for business expenses,credit and expense management, to potential spending businesses and issue business-purpose charge cards through our card issuing partner banks (Issuing Banks). When a business applies for a BILL Divvy Card, we utilize, on behalf of the Issuing Bank, proprietary risk management capabilities to confirm the identity of the business, and perform a credit underwriting process to determine if the business is eligible for a BILL Divvy Card pursuant to our credit policies. Once approved for a BILL Divvy CardCard, the spending business is provided a credit limit and can use the BILL Spend and Expense software to request virtual cards or physical cards, establish budgets, and manage spend.

The cards on our platform are issued by Cross River Bank, a Federal Deposit Insurance Corporation (FDIC)-insured New Jersey state chartered bank, and WEX Bank and Web Bank,WebBank, FDIC-insured Utah state chartered banks. Under our arrangements with the Issuing Banks, we must comply with their respective credit policies and underwriting procedures, and the Issuing Banks maintain ultimate authority to decide whether to issue a card or approve a transaction. We are responsible for all fraud and unauthorized use of a card and generally are required to hold the Issuing Bank harmless from such losses unless claims regarding fraud or unauthorized use are due to the sole gross negligence of the Issuing Bank.

In order to ensure we have the operational flexibility and liquidity to purchase the participation rights in the receivables, we maintain certain funding arrangements, including warehouse facilities. We typically fund some portion of these participation interest purchases by borrowing under our credit facilities, although we may also fundmost purchases are funded using corporate cash.

(1)As of DecemberMarch 31, 2025,2026, the total number of BILL AP/AR customers was approximately 177,500181,500; the total number of spending businesses that used our BILL Spend and Expense solution was approximately 44,00045,600; and the total number of Embedded Solutions and Other customers was approximately 277,000.266,700.

(2)During the three months ended DecemberMarch 31, 2025,2026, the Total Payment Volume (TPV) by BILL AP/AR customers was approximately $79.9$73.9 billion; the total card payment volume transacted by spending businesses that used BILL Divvy Cards was approximately $6.5$6.6 billion; and the TPV transacted by Embedded Solutions and Other customers was approximately $8.7$8.2 billion. During the sixnine months ended DecemberMarch 31, 2025,2026, the TPV by BILL AP/AR customers was approximately $154.6$228.6 billion; the total card payment volume transacted by spending businesses that used BILL Divvy Cards was approximately $12.7$19.3 billion; and the TPV transacted by Embedded Solutions and Other customers was approximately $17.0$25.2 billion.

(3)During the three months ended DecemberMarch 31, 2025,2026, the total number of transactions executed by BILL AP/AR customers was approximately 12.812.1 million; the total number of transactions executed by spending businesses that used BILL Divvy Cards was approximately 19.819.5 million; and the total number of transactions executed by Embedded Solutions and Other customers was approximately 2.12.4 million. During the sixnine months ended DecemberMarch 31, 2025,2026, the total number of transactions executed by BILL AP/AR customers was approximately 25.437.4 million; the total number of transactions executed by spending businesses that used BILL Divvy Cards was approximately 38.558.1 million; and the total number of transactions executed by Embedded Solutions and Other customers was approximately 4.16.5 million.

To grow revenue from businesses using our solutions, we must deliver a product experience that helps them automate their back-office financial operations. The more they use and rely upon our product offerings to automate their operations, the more transactions they process on our platform. This metric provides an important indication of the aggregate value of transactions that businesses using our solutions are completing on our platform and is an indicator of our ability to generate revenue from businesses using our solutions. We define TPV as the total value of transactions that we process on our platform during a particular period, comprising transactions from BILL AP/AR customers, BILL Divvy Card transactions, and transactions executed by Embedded Solutions and Other customers. Our calculation of TPV is presented gross of payments that may be subsequently reversed. Such reversals comprised less than 2% of TPV during each of the three and sixnine months ended DecemberMarch 31, 20252026 and 2024.2025.

Service costs – Service costs consist primarily of costs that are directly attributed to processing customers’ and spending businesses' transactions (such as the cost of printing checks, postage for mailing checks, fees associated with the issuance and processing of card transactions, net of card network incentives, and fees for processing payments), personnel-related costs, including stock-based compensation expenses, for our customer success and payment operations teams, outsourced support services for our customer success team, direct and amortized costs for implementing and integrating our cloud-based platform with our customers’ systems, and cloud payments infrastructure costs. We expect that service costs will increase in absolute dollars, but may fluctuate as a percentage of revenue from period to period, as we continue to invest in growing our business and based on whether or not we are the principal or the agent under arrangements with third parties.

General and administrative – General and administrative expenses consist primarily of personnel-related expenses, including stock-based compensation expenses, for finance, corporate business operations, risk management, legal and compliance, human resources, and information technology,technology functions, costs incurred for external professional services, losses from fraud, and allocated overhead costs. We expect to incur additional general and administrative expenses as we explore various growth initiatives, which include incurring higher costs for professional services. We also expect to increase the size of our general and administrative functions to support the growth in our business. As a result, we expect that our general and administrative expenses will increase in absolute dollars but may fluctuate as a percentage of revenue from period to period.

Provision for expected credit losses – Provision for expected credit losses represents the amount of expense required to maintain the allowance for expected credit losses on our consolidated balance sheets, which represents management’s estimate of expected credit losses. In the event that our receivables outperform expectation and/or we reduce our expectation of credit losses in future periods, we may release reserves and thereby reduce the provision for expected credit losses. The provision is determined based on our estimate of expected credit losses on acquired cardscard receivables, loans held for investment and accounts receivable on our balance sheets, changes in our estimate of expected credit losses on receivables outstanding and loans held for investment as of the end of the period and the net charge-offs incurred in the period.

Depreciation and amortization – Depreciation and amortization consistconsists of depreciation and amortization of property and equipment, and amortization of acquired intangibles, such as developed technology, and customer relationship. Amortization of capitalized internal-use software costs paid in cash areis excluded.

Restructuring – Restructuring costs consist primarily of employee severance and other employment termination benefits related to the RIF.RIFs. Additionally, these costs may include contract termination expenses and other costs related to the execution of our efforts to improve organizational agility and efficiency, while also seeking to drive greater profitability. Refer to Note 12 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional information.

(2) Depreciation and amortization dodoes not include amortization of capitalized internal-use software costs paid in cash of $12.6$7.9 million and $17.1$25.0 million during the three and sixnine months ended DecemberMarch 31, 2025,2026, respectively, and $3.6 million and $7.4$10.9 million during the three and sixnine months ended DecemberMarch 31, 2024,2025, respectively, which are included in service costs and general and administrative in the condensed consolidated statements of operations.

Comparison of the three and sixnine months ended DecemberMarch 31, 20252026 and 20242025

The following table sets forth our revenue during the three and sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, respectively (amounts in thousands):

Total revenue increased by $52.1$48.3 million and $89.4$137.8 million during the three and sixnine months ended DecemberMarch 31, 2025,2026, respectively, as compared to the prior year period, primarily due to:

•a $51.2$44.5 million and $90.8$135.3 million increase, respectively, in transaction fee revenuefees primarily due to increased total payment volume driven by the increase in customer adoption of our products; and

•a $4.3$6.3 million and $7.8$14.1 million increase, respectively, in subscription fee revenuefees primarily due to an increase in customers as compared to the same prior year period; partially offset by

Cost of revenue, gross profit, and gross margin during the three and sixnine months ended DecemberMarch 31, 20252026 and 2024,2025, respectively, were as follows (amounts in thousands):

(1) Consists of depreciation of property and equipment and amortization of developed technology, excluding amortization of capitalized internal-use software costs paid in cash of $12.6$7.2 million and $17.1$23.5 million during the three and sixnine months ended DecemberMarch 31, 2025,2026, respectively, and $3.6 million and $7.4$10.9 million during the three and sixnine months ended DecemberMarch 31, 2024,2025, respectively, which are included in service costs.

Service costs increased by $12.9$6.0 million and $25.4$31.4 million during the three and sixnine months ended DecemberMarch 31, 2025,2026, respectively, as compared to the prior year periods, primarily due to:

•a $9.4$4.0 million and $11.9$15.9 million increase, respectively, in other costs, primarily from a $8.2$3.6 million and $8.9$12.5 million increaseincrease, respectively, in amortization of capitalized internal-use software costs paidand a $1.2 million and $3.0 million increase, respectively, in cash.software licenses and subscriptions; partially offset by

Gross margin decreasedincreased to 79.8% and 80.2%81.6% during the three and six months ended DecemberMarch 31, 20252026 as compared to 81.6% and 81.8%81.2% for the prior year period primarily due to lower personnel-related costs, including stock-based compensation expense. Gross margin decreased to 80.7% during the nine months ended March 31, 2026 as compared to 81.6% for the prior year period primarily due to a higher amortization of capitalized internal-use software costs paid in cash.cash, partially offset by lower personnel-related costs, including stock-based compensation expense.

Research and development expenses decreased by $2.0 million and $0.4$12.2 million during the three and six months ended DecemberMarch 31, 2025, respectively,2026 as compared to the prior year period, primarily due to:

•a $7.6$10.9 million and $17.6 million decrease, respectively,decrease due to a higher number of initiatives subject to capitalization of internal-use software costs; offset byand

•a $3.9$2.7 million and $14.3 million increase, respectively,decrease in personnel-related costs,expense, including stock-based compensation expense, primarily driven by increasethe indecrease headcountfrom our RIFs executed during the firstcurrent fiscal quarteryear; endedpartially Septemberoffset 30, 2025 and merit increase during the second fiscal quarter ended December 31, 2025.by

Our researchResearch and development expenses decreased to$12.5 20% and 19% as a percentage of revenuemillion during the three and sixnine months ended DecemberMarch 31, 2025, respectively,2026 as compared to 22% for each of the prior year periods,period, drivenprimarily by the revenue growth and a higher number of initiatives subjectdue to capitalization of internal-use software costs.:

Sales and marketing expenses increased by $22.9 million and $45.8$16.5 million during the three and six months ended DecemberMarch 31, 2025, respectively2026 as compared to the prior year period, primarily due to the following:

•a $22.3$16.9 million and $41.5 million increase, respectively,increase in rewards expense in connection with our BILL Divvy Cards as a result of increased transaction volume. During each of the three and six months ended December 31, 2025, rewardsRewards expense increased to 52%51% as a percentage of revenue from spend and expense interchange fees from 48%50% during each of the prior year periods,period, primarily due to higher reward rates; andpartially offset by

•a $1.4$3.5 million and $3.2 million increase, respectively,increase in personnel-related expense driven by ana increasehigher inaverage headcount and merit increase, partially offset by our RIFs executed during the firstcurrent fiscal quarter ended September 30, 2025year; and a merit increase during the second fiscal quarter ended December 31, 2025.

Our sales and marketing expenses remained flat at 38% and 37% as a percentage of revenue during the each of the three and nine months ended DecemberMarch 31, 20252026, respectively, as compared to the prior year period. Our sales and marketing expenses increased to 38% as a percentage of revenue during the six months ended December 31, 2025 from 36% during prior year period primarily due to higher reward rates when compared to prior year period.periods.

General and administrative expenses increaseddecreased by $8.4 million and $18.5$1.6 million during the three and six months ended DecemberMarch 31, 2025, respectively,2026 as compared to the prior year periods,period, primarily due to the following:

•a $4.5$5.5 million increase, during the six months ended December 31, 2025,decrease in personnel-related expense, including stock-based compensation expense, resultingdriven fromby increasethe inRIFs headcountexecuted during the firstcurrent fiscal quarter ended September 30, 2025 and a merit increase during the second fiscal quarter ended December 31, 2025year; andpartially offset by

Our generalGeneral and administrative expenses remainedincreased flatby at$17.0 20% and 19% as a percentage of our total revenuemillion during the three and sixnine months ended DecemberMarch 31, 2025, respectively,2026 as compared to the prior year periods.period, primarily due to the following:

Provision for expected credit losses increased by $1.3$3.9 million and $0.6 million during the three and nine months ended DecemberMarch 31, 20252026, respectively, as compared to the prior year period, primarily due to the following:periods.

•aProvision $9.6for millionexpected increasecredit losses from acquired card receivables relatedincreased by $3.5 million and $9.9 million during the three and nine months ended March 31, 2026, respectively, as compared to the prior year periods, primarily due to portfolio growth, an increase in delinquencies and a release of $5.7 million of the allowance for expected credit losses during the three months ended DecemberMarch 31, 20242025 as a result of arefinements decreaseto inthe delinquenciescredit loss methodology during that period; offset byperiod.