Bill Com Holdings Inc (BILL)

Short-term

Turnover ratios

The analysis of Bill Com Holdings Inc.'s activity ratios over the period from June 30, 2021, through June 30, 2025, reveals several key trends and insights into the company's operational efficiency.

Inventory Turnover:
- The inventory turnover ratio was not available as of June 30, 2021.
- Starting from June 30, 2022, the inventory turnover was 0.05, and it exhibited a marginal increase to 0.06 by June 30, 2023.
- The absence of data thereafter prevents further analysis, but the low ratios from 2022 and 2023 suggest that inventory is turning over slowly, indicating potential carryover inventory issues or low sales velocity.

Receivables Turnover:
- The receivables turnover ratio increased from 1.44 in 2021 to 2.29 in 2022, then slightly declined to 2.17 in 2023.
- There was a decline to 1.78 in 2024, followed by a rise again to 2.04 in 2025.
- The fluctuating receivables turnover indicates variability in collection efficiency, with a general improvement from 2021 to 2022, but no sustained trend thereafter.

Payables Turnover:
- The payables turnover ratio showed significant growth, increasing from 5.19 in 2021 to 14.58 in 2022, then further to 22.77 in 2023.
- It reached a peak of 31.50 in 2024 before declining sharply to 16.70 in 2025.
- The rapid increase up to 2024 suggests a shortening of the payable period, which may reflect improved supplier payment terms or changes in purchasing behavior. The subsequent decline in 2025 indicates a possible slowing in payment pace or renegotiation of terms.

Working Capital Turnover:
- The working capital turnover ratio demonstrated a consistent upward trend, from 0.19 in 2021 to 0.22 in 2022, then to 0.36 in 2023, 0.57 in 2024, and slightly down to 0.55 in 2025.
- The steady increase signifies improved utilization of working capital over the years, reflecting better operational efficiency in generating sales from the working capital investment.

Overall, the activity ratios suggest that Bill Com Holdings Inc. has experienced incremental improvements in receivables and working capital efficiency. The payables ratio’s sharp rise and subsequent fall indicate dynamic changes in supplier payment strategies, potentially impacting liquidity. The low inventory turnover ratios imply inventory management may be less efficient or that inventory levels are maintained conservatively. Collectively, these ratios provide insights into the company's operational focus on optimizing receivables and working capital utilization while highlighting areas for potential inventory and payable management improvement.

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Average number of days

The activity ratios of Bill Com Holdings Inc., specifically the days of inventory on hand (DOH), days of sales outstanding (DSO), and the number of days of payables, reveal notable trends and shifts over the analyzed time period.

Starting with the days of inventory on hand, the data for June 30, 2021, is not available. However, by June 30, 2022, the DOH is reported at an exceptionally high 7,910.62 days, indicating a significant buildup of inventory or potential issues in inventory turnover. In the subsequent year, this metric decreases substantially to 6,314.70 days by June 30, 2023, suggesting a possible effort to reduce excess inventory or improve inventory management. Despite the decline, the inventory levels remain abnormally high, which could reflect operational inefficiencies or inventory holding patterns that are atypical compared to industry standards. Data for June 30, 2024, and June 30, 2025, are unavailable, precluding further trend analysis for these periods.

Regarding days of sales outstanding, there is a notable decrease from 253.25 days on June 30, 2021, to 159.45 days in 2022. This indicates an improvement in receivables collection efficiency. However, in 2023, the DSO increases slightly to 167.90 days, suggesting a slight loosening in collection practices or potentially extended credit terms. The years 2024 and 2025 show rising DSO figures of 205.18 days and 179.05 days respectively, implying a trend toward lengthening receivables collection periods, which could impact cash flow and liquidity if sustained.

Finally, the number of days of payables demonstrates a decreasing trend initially, from 70.30 days in 2021 to 25.04 days in 2022, then further declining to 16.03 days in 2023. This trend indicates that the company is paying its suppliers more quickly over this period. In 2024, payables days further decrease to 11.59 days, but then increase again to 21.86 days in 2025. The fluctuations suggest some adjustments in payment terms or supplier relationships, which could influence the company's working capital management and liquidity position.

Overall, the ratios depict a company managing high inventory levels in 2022 and 2023, alongside a progressive extension of receivables and a fluctuating approach to payables. The extremely high and fluctuating inventory days raise concerns about operational efficiency, while the variations in receivables and payables ratios reflect shifts in credit and payment policies. Careful analysis of these trends relative to industry benchmarks and operational context would be necessary for a comprehensive assessment of the company's activity management effectiveness.

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Long-term

The analysis of Bill Com Holdings Inc.'s long-term activity ratios reveals a notable improvement in asset utilization over the period from June 30, 2021, to June 30, 2023. The Fixed Asset Turnover ratio, which measures how efficiently the company generates sales from its fixed assets, increased markedly from 1.97 in 2021 to 4.81 in 2022, and further surged to 12.98 in 2023. This sharp upward trend indicates substantial enhancements in the effective utilization of fixed assets, possibly arising from asset rejuvenation, operational efficiencies, or strategic asset management.

Similarly, the Total Asset Turnover ratio exhibited consistent growth, rising from 0.04 in 2021 to 0.07 in 2022, and reaching 0.11 in 2023. The incremental increases suggest ongoing improvements in overall asset efficiency, reflecting better management of total assets relative to sales. The data implies that although the ratios remain relatively low, their upward trajectory signifies progressive gains in asset utilization.

Analyzing the period beyond 2023, the absence of data for June 30, 2024, and June 30, 2025, limits the ability to assess future trends. However, the substantial increases observed up to 2023 underscore a positive development in the company's long-term activity efficiency, particularly in fixed asset utilization.

In summary, Bill Com Holdings Inc. demonstrates a strong and consistent enhancement in its long-term asset turnover ratios over the observed period, indicating a significant improvement in asset efficiency and operational productivity from 2021 through 2023.