AI and Cost Cuts Are Improving the Profit Outlook
BILL Holdings, Inc. (NYSE:BILL) is reorganizing its financial automation platform around AI while projecting slower sales growth for fiscal 2027. That is not necessarily contradictory: the company can generate higher earnings through lower operating costs and more payment activity even if total revenue growth moderates.
The question is how sustainable that improvement will be. After a broad software-sector recovery from fears of AI disruption, investors are increasingly distinguishing products that generate incremental revenue from technology that mainly makes the existing organization more efficient. For BILL Holdings, Inc., both outcomes matter, but they produce different long-term earnings trajectories.
BILL Holdings occupies sixth place in our ranking of the 10 best growth stocks under $50 to buy now, putting the financial software provider just outside the top five. But which company narrowly outranks BILL, and what entirely different growth opportunity managed to secure the top spot?
Transaction Growth Is Real; Adjusted Profit Is Growing Faster
BILL Holdings, Inc. reported fiscal fourth-quarter 2026 revenue of $436.2 million, up 14% YoY. Core revenue rose 16% to $400.5 million, led by transaction fees of $324.3 million, up 17%; subscription revenue rose 11% to $76.2 million. Customers processed approximately $98 billion of payments, also up 14%, showing that transaction activity remains central to monetization.
Non-GAAP operating income jumped 80% to $101.6 million, yet the GAAP operating loss widened to $34.3 million from $22.3 million. That divergence matters because adjusted profit excludes expenses that still affect reported results. Management expects fiscal 2027 revenue to grow 9% to 12% to $1.807 billion–$1.857 billion, compared with approximately 13% growth in fiscal 2026. Faster projected earnings growth therefore needs an explanation beyond accelerating sales.
The scale of the AI effort is already visible. An earlier look inside BILL’s AI transformation describes the growing number of business users and raises the more important question of how automation might eventually change the company’s economics.
AI Adoption Alone Does Not Prove Revenue Monetization
More than 175,000 businesses used BILL Holdings, Inc.’s AI agents by the latest earnings call. Its invoice-coding agent had been adopted by over 60,000 companies, and another tool had automated more than seven million transaction fields. Those figures demonstrate use of AI across an established network, but management has not separately disclosed enough revenue to calculate a stand-alone return on those tools.
The nearer-term earnings benefit is easier to identify. Truist raised its target to $52 from $44 in September while retaining Hold, noting that its revenue forecast changed little but adjusted profit assumptions improved as workforce savings arrived sooner. BMO Capital increased its target to $55 from $46 (Market Perform), but wanted evidence that reorganized sales teams could improve execution. Management has acknowledged slower-than-expected adoption of certain supplier payment offerings, a reminder that efficiency and customer spending do not automatically rise together.
The Earnings Forecast Depends on More Than Layoffs
BILL Holdings, Inc. expects fiscal 2027 non-GAAP EPS of $3.56–$3.79, supported by restructuring and buybacks. Seeking Alpha’s October 13 estimates imply a P/E of 11.80 times fiscal 2027 earnings, falling to 10.13 in 2028, 8.41 in 2029, and 6.62 in 2030, based on current valuation estimates. Consensus EPS growth is projected at 34.59%, 16.41%, 20.46%, and 27.01% across those four fiscal years. Sustaining that trajectory beyond the initial savings will require stronger transaction monetization or renewed revenue acceleration.
BILL’s September partnership with Blackbaud may expand payments through software already used by nonprofit and education customers, but no revenue contribution was disclosed. The larger sector is also exploring entirely new workflows: PayPal’s wager on AI-driven commerce illustrates why control of the payment process may matter as much as the software interface.
Hedge fund ownership in BILL Holdings, Inc. declined from 61 to 54 funds in Q2, though Starboard Value remained a major shareholder and Arrowstreet increased its position. Short interest represented 17.14% of the reported float on September 30.
BILL’s restructuring and cost reductions are driving adjusted earnings growth faster than revenue, but the next test is whether AI capabilities, cross-selling, and payment partnerships can sustain those gains once the initial savings are realized.
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