BILL Holdings Inc

Previous wording

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 and financial institution partnerships. As of September 30, 2024, 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 seven of the top ten largest financial institutions for SMBs in the U.S., including Bank of America, JPMorgan Chase, Wells Fargo Bank, and American Express. As we add customers and partners, we expect our network to continue to grow organically.

Current wording

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 and financial institution partnerships. As of December 31, 2024, 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 seven of the top ten largest financial institutions for SMBs in the 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.

Previous wording

We have grown rapidly and scaled our business operations in recent periods. Our revenue was $358.5 million and $305.0 million during the three months ended September 30, 2024 and 2023, respectively, an increase of $53.5 million. We generated net income of $8.9 million and a net loss of $27.9 million during the three months ended September 30, 2024 and 2023, respectively.

Current wording

We have grown rapidly and scaled our business operations in recent periods. Our revenue was $362.6 million and $318.5 million during the three months ended December 31, 2024 and 2023, respectively, an increase of $44.1 million, and our revenue was $721.0 million and $623.5 million during the six months ended December 31, 2024 and 2023, respectively, an increase of $97.5 million. We generated net income of $33.5 million and a net loss of $40.4 million during the three months ended December 31, 2024 and 2023, respectively, and generated net income of $42.5 million and a net loss of $68.3 million during the six months ended December 31, 2024 and 2023, respectively.

Previous wording

Elevated interest rates and inflation in the U.S. and other markets globally increased economic volatility and led to tightening in credit markets in the U.S. and globally in recent periods. The SMBs we serve are particularly susceptible to changes in overall economic and financial conditions, and certain SMBs may cease operations in the event of a recession or inability to access financing. The macroeconomic environment has caused our BILL standalone customers and spending businesses using BILL Spend and Expense to moderate their expenditures and, in certain cases, shift to lower-cost methods of payment, resulting in lower payment volume growth and lower transaction fee growth than historical trends. Although the U.S. Federal Reserve Bank's recent action to reduce interest rates, and expectations regarding future reductions, may mitigate these conditions, there can be no assurance of future rate cuts or any corresponding increase in economic activity. Moreover, there can be no assurance that, in the event of a recession, demand for our products would not be adversely affected. We intend to continue to monitor macroeconomic conditions closely and to take appropriate financial or operational actions in response to such conditions.

Current wording

Elevated interest rates and inflation in the U.S. and other markets globally increased economic volatility and led to tightening in credit markets in the U.S. and globally in recent periods. The SMBs we serve are particularly susceptible to changes in overall economic and financial conditions, and certain SMBs may, in the event of a recession or inability to access financing, moderate their expenditures, shift to lower-cost methods of payment, or cease operations entirely. Recent 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. Moreover, it is difficult to predict the impact of new economic or trade policies in the U.S., including the imposition of tariffs on key trading partners, on the

Previous wording

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 changes in central bank policies and interest rates, rates of inflation, the impact to our customers, spending businesses, subscribers, partners, and suppliers, and other factors described in the section titled “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q.

Current wording

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 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 II, Item 1A of this Quarterly Report on Form 10-Q.

Previous wording

(1)As of September 30, 2024, the total number of BILL AP/AR customers was approximately 156,100; the total number of spending businesses that used our BILL Spend and Expense solution was approximately 36,400; and the total number of Embedded Solutions and Other customers was approximately 283,700.

Current wording

(1)As of December 31, 2024, the total number of BILL AP/AR customers was approximately 160,600; the total number of spending businesses that used our BILL Spend and Expense solution was approximately 37,800; and the total number of Embedded Solutions and Other customers was approximately 282,900.

Previous wording

(2)During the three months ended September 30, 2024, the total payment volume (TPV) transacted by BILL AP/AR customers was approximately $67.7 billion; the total card payment volume transacted by spending businesses that used BILL Divvy Corporate Cards was approximately $5.1 billion; and the TPV transacted by Embedded Solutions and Other customers was approximately $7.1 billion.

Current wording

(2)During the three months ended December 31, 2024, the total payment volume (TPV) transacted by BILL AP/AR customers was approximately $71.9 billion; the total card payment volume transacted by spending businesses that used BILL Divvy Corporate Cards was approximately $5.2 billion; and the TPV transacted by Embedded Solutions and Other customers was approximately $7.4 billion. During the six months ended December 31, 2024, TPV transacted by BILL AP/AR customers was approximately $139.5 billion; the total card payment volume transacted by spending businesses that used BILL Divvy Corporate Cards was approximately $10.3 billion; and the TPV transacted by Embedded Solutions and Other customers was approximately $14.7 billion.

Previous wording

(3)During the three months ended September 30, 2024, the total number of transactions executed by BILL AP/AR customers was approximately 11.7 million; the total number of transactions executed by spending businesses that used BILL Divvy Corporate Cards was approximately 15.3 million; and the total number of transactions executed by Embedded Solutions and Other customers was approximately 1.6 million.

Current wording

(3)During the three months ended December 31, 2024, the total number of transactions executed by BILL AP/AR customers was approximately 12.2 million; the total number of transactions executed by spending businesses that used BILL Divvy Corporate Cards was approximately 16.1 million; and the total number of transactions executed by Embedded Solutions and Other customers was approximately 1.7 million. During the six months ended December 31, 2024, the total number of transactions executed by BILL AP/AR customers was approximately 23.8 million; the total number of transactions executed by spending businesses that used BILL Divvy Corporate Cards was approximately 31.4 million; and the total number of transactions executed by Embedded Solutions and Other customers was approximately 3.7 million.

Previous wording

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 Corporate Card transactions, and transactions executed by Embedded Solutions and Other customers. Our calculation of TPV includes payments that are subsequently reversed. Such payments comprised less than 2% of TPV during each of the three months ended September 30, 2024 and 2023.

Current wording

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 Corporate Card transactions, and transactions executed by Embedded Solutions and Other customers. Our calculation of TPV includes payments that are subsequently reversed. Such payments comprised less than 2% of TPV during each of the three and six months ended December 31, 2024 and 2023.

Previous wording

(3)Provision for expected credit losses was included in general and administrative expenses during the three months ended September 30, 2023.

Current wording

(3)Provision for expected credit losses was included in general and administrative expenses during the three and six months ended December 31, 2023.

Previous wording

Comparison of the three months ended September 30, 2024 and 2023

Current wording

Comparison of the three and six months ended December 31, 2024 and 2023

Previous wording

The following table sets forth our revenue during the three months ended September 30, 2024 and 2023, respectively (amounts in thousands):

Current wording

The following table sets forth our revenue during the three and six months ended December 31, 2024 and 2023, respectively (amounts in thousands):

Previous wording

Total revenue increased by $53.5 million during the three months ended September 30, 2024, as compared to the prior year period, primarily due to:

Current wording

Total revenue increased by $44.1 million and $97.5 million during the three and six months ended December 31, 2024, respectively, as compared to the prior year periods, primarily due to:

Previous wording

•a $44.8 million increase in transaction fee revenue primarily due to increased total payment volume driven by the increase in customer adoption of our products;

Current wording

•a $40.3 million and $85.1 million increase, respectively, in transaction fee revenue primarily due to increased total payment volume driven by the increase in customer adoption of our products;

Previous wording

•a $5.0 million increase during the three months ended September 30, 2024 in subscription fee revenue primarily due to an increase in customers as compared to the same prior year period; and

Current wording

•a $4.4 million and $9.4 million increase, respectively, in subscription fee revenue primarily due to an increase in customers as compared to the same prior year period; and

Previous wording

Cost of revenue, gross profit, and gross margin during the three months ended September 30, 2024 and 2023 were as follows (amounts in thousands):

Current wording

Cost of revenue, gross profit, and gross margin during the three and six months ended December 31, 2024 and 2023 were as follows (amounts in thousands):

Previous wording

Service costs increased by $8.7 million during the three months ended September 30, 2024, respectively, as compared to the prior year period, primarily due to:

Current wording

Service costs increased by $9.1 million and $17.8 million during the three and six months ended December 31, 2024, respectively, as compared to the prior year periods, primarily due to:

Previous wording

•a $9.4 million increase in direct costs associated with the processing of payments made by businesses using our solutions, which were driven by the increase in the number of customers, and an increase in the volume of transactions;

Current wording

•an $8.6 million and $18.0 million increase, respectively, in direct costs associated with the processing of payments made by businesses using our solutions, which were driven by the increase in the number of customers, and an increase in the volume of transactions;

Previous wording

•a $2.7 million increase in costs for consultants and temporary contractors, shared overhead, and other costs; offset by

Current wording

•a $0.5 million and $1.2 million increase, respectively, in costs for consultants and temporary contractors; offset by

Previous wording

•a $3.4 million decrease in personnel-related costs due to the decrease in service cost personnel resulting from our reduction-in-force announced in December 2023.

Current wording

•a $1.2 million and $4.6 million decrease, respectively, in personnel-related costs due to the decrease in service cost personnel resulting from our reduction-in-force announced in December 2023.

Previous wording

Research and development expenses decreased by $10.4 million during the three months ended September 30, 2024, as compared to the prior year period, primarily due to a $9.3 million decrease in personnel-related costs, including stock-based compensation expense, resulting from our reduction-in-force announced in December 2023.

Current wording

Research and development expenses decreased by $1.7 million and $12.1 million during the three and six months ended December 31, 2024, respectively, as compared to the prior year periods, primarily due to a $1.7 million and $11.0 million decrease, respectively, in personnel-related costs, including stock-based compensation expense, resulting from our reduction-in-force announced in December 2023.

Previous wording

Our research and development expenses decreased to 21% as a percentage of revenue during the three months ended September 30, 2024 from 29% during the prior year period primarily due to revenue growth and a decrease in personnel-related expenses, including stock-based compensation, as a percentage of revenue.

Current wording

Our research and development expenses decreased to 22% as a percentage of revenue during each of the three and six months ended December 31, 2024, from 26% and 28% during the prior year periods, respectively, primarily due to revenue growth and a decrease in personnel-related expenses, including stock-based compensation, as a percentage of revenue.

Previous wording

Sales and marketing expenses increased by $7.9 million during the three months ended September 30, 2024, as compared to the prior year period, primarily due to the following:

Current wording

Sales and marketing expenses increased by $14.2 million and $22.2 million during the three and six months ended December 31, 2024, respectively, as compared to the prior year period, primarily due to the following:

Previous wording

•a $10.3 million increase in rewards expense in connection with the rewards program through our BILL Divvy Corporate Cards as a result of increased transaction volume. Rewards expense decreased from 49% to 47% as a percentage of revenue from spend and expense interchange fees primarily due to lower rewards redemption rate; offset by

Current wording

•an $11.1 million and $21.4 million increase, respectively, in rewards expense in connection with the rewards program through our BILL Divvy Corporate Cards as a result of increased transaction volume. During the three and six months ended December 31, 2024, rewards expense decreased to 48% as a percentage of revenue from 49% during the prior year periods, primarily due to a lower rewards redemption rate;

Previous wording

•a $1.8 million decrease in personnel-related costs due to a lower stock-based compensation expense resulting from our reduction-in-force announced in December 2023.

Current wording

•a $1.5 million decrease during the six months ended December 31, 2024, in personnel-related costs due to a lower stock-based compensation expense resulting from our reduction-in-force announced in December 2023.

Previous wording

Our sales and marketing expenses decreased to 35% as a percentage of revenue during the three months ended September 30, 2024 from 39% during the prior year period primarily due to a revenue growth and decrease in stock-based compensation.

Current wording

Our sales and marketing expenses remained flat at 37% as a percentage of revenue during the three months ended December 31, 2024. Our sales and marketing expenses decreased to 36% as a percentage of revenue during the six months ended December 31, 2024 from 38% during the prior year period primarily due to a revenue growth.

Previous wording

•a $3.6 million decrease in consulting fees for outside general and administrative services.

Current wording

•a $2.1 million and $5.7 million decrease, respectively, in consulting fees for outside general and administrative services.

Previous wording

Our general and administrative expenses decreased to 19% as a percentage of our total revenue during the three months ended September 30, 2024 from 24% during the prior year period, primarily due to the revenue growth rate and a decrease in personnel-related costs as a percentage of revenue.

Current wording

Our general and administrative expenses decreased to 20% and 19% as a percentage of our total revenue during the three and six months ended December 31, 2024, respectively, from 22% and 23% during the prior year periods, primarily due to a revenue growth.

Previous wording

Provision for expected credit losses increased by $8.6 million during the three months ended September 30, 2024, as compared to the prior year period, primarily due to portfolio growth in acquired card receivables and loans held for investment.

Current wording

Provision for expected credit losses increased by $5.8 million and $14.4 million during the three and six months ended December 31, 2024, respectively, as compared to the prior year periods, primarily due to portfolio growth and an increase in delinquencies in loans held for investment, which was partially offset by lower delinquencies in acquired cards receivable.

Previous wording

Depreciation and amortization decreased by $3.8 million during the three months ended September 30, 2024, as compared to the prior year period, primarily due to certain fully amortized intangible assets as of the beginning of the current period.

Current wording

Depreciation and amortization decreased by $5.3 million and $9.1 million during the three and six months ended December 31, 2024, respectively, as compared to the prior year periods, primarily due to certain fully amortized intangible assets as of the beginning of the current fiscal year.

Previous wording

Other income, net decreased $11.4 million during the three months ended September 30, 2024, as compared to the prior year period, primarily due to an $11.5 million decrease in interest income due to a reduction in the balance of corporate funds driven by the partial repurchase of our 2025 Notes during fiscal 2024.

Current wording

•a $13.9 million and $25.4 million decrease in interest income, respectively, primarily due to a reduction in the balance of corporate funds driven by the partial repurchase of our 2025 Notes during fiscal 2024 and repurchases of our common stock during fiscal 2024 and 2025.

Previous wording

Provision for income taxes during the three months ended September 30, 2024 pertained mainly to an estimated cash tax liability resulting primarily from the capitalization of R&D costs for federal and certain state tax purposes for the year ending June 30, 2025.

Current wording

Provision for income taxes during the three and six months ended December 31, 2024 pertained primarily to an estimated cash tax liability resulting from the capitalization of R&D costs for federal and certain state tax purposes for the year ending June 30, 2025, offset, in part, by a reduction to the net deferred tax liability, as a result of our current year losses.

Previous wording

As of September 30, 2024, our principal sources of liquidity were our cash and cash equivalents of $853.5 million, our available-for-sale short-term investments of $619.6 million, and our available undrawn Revolving Credit Facility (as defined below) of $120.0 million. Our cash equivalents are comprised primarily of money market funds and investments in debt securities with original maturities of three months or less at the time of purchase. Our short-term investments are comprised primarily of available-for-sale investments in corporate bonds, certificates of deposit, asset-backed securities, municipal bonds, U.S. agency securities, and U.S. treasury securities with original maturities of more than three months. Our corporate deposits held at large multinational financial institutions and U.S. national or regional banks, may at times exceed federally insured limits. We monitor the financial strength of the financial institutions with which we do business to ensure they are financially sound and present minimal credit risk. We further believe the associated risk of concentration for our investments is mitigated by holding a diversified portfolio of highly rated investments consisting of the money market funds and short-term debt securities described above. We have a total borrowing commitment of $300.0 million from our Revolving Credit Facility and have drawn $180.0 million as of September 30, 2024. Our principal uses of cash are funding our operations and other working capital requirements, including the contractual and other obligations discussed below.

Current wording

As of December 31, 2024, our principal sources of liquidity were our cash and cash equivalents of $1,566.3 million, our available-for-sale short-term investments of $644.7 million, and our available undrawn Revolving Credit Facility (as defined below) of $120.0 million. Our cash equivalents are comprised primarily of money market funds and investments in debt securities with original maturities of three months or less at the time of purchase. Our short-term investments are comprised primarily of available-for-sale investments in corporate bonds, certificates of deposit, asset-backed securities, municipal bonds, U.S. agency securities, and U.S. treasury securities with original maturities of more than three months. Our corporate deposits held at large multinational financial institutions and U.S. national or regional banks, may at times exceed federally insured limits. We monitor the financial strength of the financial institutions with which we do business to ensure they are financially sound and present minimal credit risk. We further believe the associated risk of concentration for our investments is mitigated by holding a diversified portfolio of highly rated investments consisting of the money market funds and short-term debt securities described above. We have a total borrowing commitment of $300.0 million from our Revolving Credit Facility and have drawn $180.0 million as of December 31, 2024. Our principal uses of cash are funding our operations and other working capital requirements, including the contractual and other obligations discussed below.

Previous wording

We believe that our cash, cash equivalents, and short-term investments will be sufficient to meet our working capital requirements for at least the next 12 months. In the future, we may attempt to raise additional capital through the sale of equity securities or through equity-linked or debt financing arrangements to fund future operations or obligations, including the repayment of the principal amount of the Notes in the event that the Notes become convertible and the note holders opt to exercise their right to convert. We may also seek to raise additional capital from these offerings or financings on an opportunistic basis when we believe there are suitable opportunities for doing so. If we raise additional funds by issuing equity or equity-linked securities, the ownership of our existing stockholders will be diluted. If we raise additional financing by incurring additional indebtedness, we may be subject to increased fixed payment obligations and could also be subject to additional restrictive covenants, such as limitations on our ability to incur additional debt, and other operating restrictions that could adversely impact our ability to conduct our business. Any future indebtedness we incur may have terms that could be unfavorable to equity investors. There can be no assurances that we will be able to raise additional capital. The inability to raise capital would adversely affect our ability to achieve our business objectives.

Current wording

We believe that our cash, cash equivalents, and short-term investments will be sufficient to meet our working capital requirements for at least the next 12 months. In the future, we may attempt to raise additional capital through the sale of equity securities or through additional equity-linked or debt financing arrangements to fund future operations or obligations, including the repayment of outstanding convertible senior notes. We may also seek to raise additional capital from these offerings or financings on an opportunistic basis when we believe there are suitable opportunities for doing so. If we raise additional funds by issuing equity or equity-linked securities, the ownership of our existing stockholders will be diluted. If we raise additional financing by incurring additional indebtedness, we may be subject to increased fixed payment obligations and could also be subject to additional restrictive covenants, such as limitations on our ability to incur additional debt, and other operating restrictions that could adversely impact our ability to conduct our business. Any future indebtedness we incur may have terms that could be unfavorable to equity investors. There can be no assurances that we will be able to raise additional capital. The inability to raise capital would adversely affect our ability to achieve our business objectives.

Previous wording

Our principal commitments to settle our contractual obligations consist of our 2025 Notes and 2027 Notes, outstanding borrowings from our Revolving Credit Facility as further discussed below. For additional discussion about our Notes and Revolving Credit Facility, refer to Note 7 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. In addition, we have minimum commitments under our noncancellable operating lease agreements and agreements with certain vendors.

Current wording

Our principal commitments to settle our contractual obligations consist of our 2025 Notes, 2027 Notes, 2030 Notes, and outstanding borrowings from our Revolving Credit Facility as further discussed below. For additional discussion about our Notes and Revolving Credit Facility, refer to Note 7 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. In addition, we have minimum commitments under our noncancellable operating lease agreements and agreements with certain vendors. There have been no material changes to our contractual obligations, commitments or litigation from those disclosed in Note 15 to the financial statements in our 2024 10-K.

Previous wording

In August 2024, our Board of Directors approved a new share repurchase program, pursuant to which we announced our intention to purchase up to $300 million of our outstanding shares of common stock (the August 2024 Share Repurchase Program). We may repurchase shares from time to time through open market purchases, in privately negotiated transactions, or by other means, including through the use of trading plans. The timing and total amount of stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The August 2024 Share Repurchase Program has no mandated end date, may be suspended, discontinued or modified at any time, and does not obligate us to acquire any amount of common stock. During the three months ended September 30, 2024, we repurchased and subsequently retired 3,711,246 shares for $201.7 million under the August 2024 Share Repurchase Program. The total price of the shares repurchased and related transaction costs are reflected as a reduction of common stock and accumulated deficit on the our condensed consolidated balance sheets. As of September 30, 2024, approximately $100.0 million remained available for future share repurchases under the August 2024 Share Repurchase Program.

Current wording

In August 2024, our board of directors approved a new share repurchase program, pursuant to which we announced our intention to purchase up to $300.0 million of our outstanding shares of common stock (the August 2024 Share Repurchase Program). We may repurchase shares from time to time through open market purchases, in privately negotiated transactions, or by other means, including through the use of trading plans. The timing and total amount of stock repurchases will depend upon business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The August 2024 Share Repurchase Program has no mandated end date, may be suspended, discontinued or modified at any time, and does not obligate us to acquire any amount of common stock. During the six months ended December 31, 2024, we repurchased and subsequently retired 3,711,246 shares for $201.4 million under the August 2024 Share Repurchase Program. As of December 31, 2024, approximately $100.0 million remained available for future share repurchases under the August 2024 Share Repurchase Program. In December 2024, our board of directors approved the repurchase of up to an additional $200.0 million of our outstanding shares of common stock in connection with the issuance of the 2030 Notes. We repurchased 2,260,397 shares of our common stock for $201.4 million in privately negotiated transactions concurrently with the pricing of, and using the proceeds from, the issuance of the 2030 Notes. The total price of the shares repurchased and related transaction costs are reflected as a reduction of common stock and accumulated deficit on our condensed consolidated balance sheets.

Previous wording

Net cash provided by operating activities increased to $88.6 million during the three months ended September 30, 2024, from $53.7 million during the prior year period. The net change was mainly due to the increase in our revenues.

Current wording

Net cash provided by operating activities increased to $167.3 million during the six months ended December 31, 2024, from $133.3 million during the prior year period. The net change was mainly due to the increase in our revenues during the period.

Previous wording

Our net cash used in investing activities was $139.5 million during the three months ended September 30, 2024, compared to net cash provided of $301.8 million during the prior year period. The net change was primarily due to the decrease in proceeds from maturities of corporate and customer short-term investments and increase in purchases of corporate and customer short-term investments.

Current wording

Our net cash used in investing activities was $129.7 million during the six months ended December 31, 2024, compared to net cash provided of $251.6 million during the prior year period. The net change was primarily due to the decrease in proceeds from maturities of corporate and customer short-term investments, and increase in purchases of corporate and customer short-term investments.

Previous wording

Our cash usage for our financing activities consists primarily of repurchases of shares. Our cash proceeds from our financing activities consist primarily of proceeds from exercises of stock options and employee purchases of our common stock under our Employee Stock Purchase Plan (ESPP). Additionally, the increase or decrease in our net cash from financing activities is impacted by the change in customer fund deposits liability and prepaid card deposits.

Current wording

Our cash proceeds from our financing activities consist primarily of proceeds from issuance of convertible senior notes, net of discounts and issuance costs, and exercises of stock options and employee purchases of our common stock under our Employee Stock Purchase Plan (ESPP). Our cash usage for our financing activities consists primarily of repurchase of convertible senior notes, repurchases of shares and purchase of capped calls. Additionally, the increase or decrease in our net cash from financing activities is impacted by the change in customer fund deposits liability and prepaid card deposits.

Previous wording

Net Cash Used in Financing Activities

Current wording

Our net cash used in financing activities increased to $432.5 million during the six months ended December 31, 2024, from $78.8 million during the prior year period. The increase was primarily due to proceeds from issuance of convertible senior notes, net of discounts and issuance costs and increase in prepaid card deposits, offset by payments for repurchase of convertible senior notes, increase in customer fund deposit liability, increase in repurchase of common stock and purchase of capped call.

Previous wording

On September 24, 2021, we issued $575.0 million in aggregate principal amount of our 0% convertible senior notes due on April 1, 2027 (the 2027 Notes). The 2027 Notes are senior, unsecured obligations, will not accrue interest unless we determine to pay special interest, and are convertible on or after January 1, 2027 until the close of business on the second scheduled trading day immediately preceding the maturity date on April 1, 2027. The 2027 Notes are convertible by the holders at their option during any calendar quarter after December 31, 2021 under certain circumstances, including 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 $414.80 per share initial conversion price. If the note holders exercise their right to convert, our current intent is to settle such conversion through a combination settlement involving a repayment of the principal portion in cash and the balance in shares of common stock. For additional discussion about our 2027 Notes and the capped call transactions, refer to Note 7 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

Current wording

On September 24, 2021, we issued $575.0 million in aggregate principal amount of our 0% convertible senior notes due on April 1, 2027 (the 2027 Notes). The 2027 Notes are senior, unsecured obligations, will not accrue interest unless we determine to pay special interest, and are convertible on or after January 1, 2027 until the close of business on the second scheduled trading day immediately preceding the maturity date on April 1, 2027. The 2027 Notes are convertible by the holders at their option during any calendar quarter after December 31, 2021 under certain circumstances, including 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 $414.80 per share initial conversion price. If the note holders exercise their right to convert, our current intent is to settle such conversion through a combination settlement involving a repayment of the principal portion in cash and the balance in shares of common stock.