Bill Com Holdings Inc (BILL)

The provided financial data indicates that Bill Com Holdings Inc. maintains a consistent and notably conservative capital structure with respect to its solvency ratios. Specifically, the debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio are all reported as zero across all evaluated periods from September 30, 2020, through June 30, 2025. This suggests that the company has not engaged in debt financing during this timeframe, implying that its liabilities are essentially absent or negligible relative to its assets, capital, and equity.

In contrast, the financial leverage ratio varies over the same periods but remains within a relatively stable range, decreasing from a high of 4.66 in December 2020 to approximately 2.25–2.57 towards the end of the period. This ratio measures the proportion of assets financed through debt relative to equity, and the declining trend indicates a reduction in leverage, or alternatively, an increase in equity or other forms of funding not classified as debt.

The absence of debt-related ratios combined with a stable or decreasing financial leverage ratio suggests that Bill Com Holdings Inc. operates with minimal to no leverage, potentially relying on equity funding or internal financing to fund operations and growth. This capital structure minimizes solvency risk, as the company does not bear the obligations or repayment pressures associated with debt.

Overall, the company's solvency profile appears highly conservative, characterized by an extensive reliance on non-debt sources of finance, which significantly lowers its financial risk and enhances its capacity to withstand economic or operational downturns without the pressure of debt obligations.

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Coverage ratios

The interest coverage ratios for Bill Com Holdings Inc. from September 30, 2020, through June 30, 2025, exhibit a significant improvement over this period. During the initial reporting periods, the ratios were substantially negative, indicating that the company's earnings before interest and taxes (EBIT) were insufficient to cover its interest expenses, and, in some cases, the company was experiencing substantial losses. Specifically, from September 30, 2020, through March 31, 2022, the interest coverage ratios ranged from approximately -357.09 to -16.42, reflecting severe challenges in generating sufficient earnings to meet interest obligations.

From late 2022 onward, a steady trend towards normalization is observed. The ratios begin moving closer to positive territory, suggesting improvement in operational profitability or reductions in interest expenses. Notably, by September 30, 2023, the ratio reaches -10.06, still negative, but markedly better than previous levels. This upward trend continues, and significant positive shifts are recorded in 2024 and early 2025, with ratios turning positive at the end of 2024. Specifically, the interest coverage ratio reaches 5.38 as of December 31, 2024, and further improved to 3.14 by March 31, 2025, indicating that earnings before interest and taxes are now more than sufficient to cover interest expenses.

Overall, the data reflects a trajectory of operational recovery and improving financial stability for Bill Com Holdings Inc., transitioning from years of negative interest coverage ratios to periods where the company consistently generates enough income to comfortably cover its interest obligations. This trend suggests a notable strengthening of the company’s financial health over the observed period.