A funny thing happened on the way to Bill.com Holdings' (BILL -9.17%) fourth-quarter earnings report last night. The cloud-based payments software maker missed earnings, reporting a $0.07-per-share pro forma loss where Wall Street had expected only a $0.04 loss. It also warned of worse-than-expected losses in the fiscal first quarter of 2022 and fiscal 2022 as a whole.
And then Bill.com stock went up -- 21.5% already as of 10 a.m. EDT.
So what is an investor to make of this? Basically, investors are reading Bill.com as a revenue story, not a profits story.
That's good news for shareholders, because the profits story at Bill.com is well and truly awful. You see, not only did Bill.com lose $0.03 per share more than Wall Street had expected, pro forma. When calculated according to generally accepted accounting principles (GAAP), Bill.com's losses were actually much worse -- $0.48 per share lost in the fiscal fourth quarter of 2021 (more than three times as bad as Q1 2020), and $1.19 per share lost in all of fiscal 2021 (70% worse than last year).
On the plus side, though, Bill.com doubled its core revenue in Q4, grew total revenue 86% to $78.3 million (Wall Street had expected $62.1 million), and grew sales for the year 51% to $238.3 million.
Yes, you read that right. While losses are staggering, Bill.com's revenue grew briskly, and indeed, its revenue growth accelerated in Q4. Probably even more attractive to investors, Bill.com promised that revenue will continue accelerating in the new fiscal year.
Guidance now calls for sales to more than double in fiscal Q1 2022 to about $103.7 million, and to at least double year over year for the full year as well, hitting about $478 million in fiscal 2022.
Granted, losses will continue all year long. Bill.com says it will lose $0.20 or $0.21 in Q1 alone, pro forma, and between $0.88 and $0.92 for the year. That didn't worry investors this quarter, however, and it seems they're not going to worry about it next year, either.