Key Takeaways:
Payments firm BILL Holdings Inc. said Thursday it will cut up to 30% of its workforce and buy back $1 billion in shares, sending its stock up over 8% in extended trading.
The move follows pressure from activist investors including Starboard Value, which holds an 8.5% stake and has nominated four candidates for the company's board, and Elliott Investment Management, according to a Reuters report.
BILL expects to incur $30 million to $60 million in restructuring charges, with the majority to be incurred in the fourth quarter of fiscal 2026. The new $1 billion buyback authorization represents approximately 27 percent of the company's $3.73 billion market capitalization as of Thursday's close.
The job cuts and buyback signal a sharp focus on shareholder returns after the stock lost nearly 31 percent of its value year-to-date. The restructuring is expected to be completed by the end of the first quarter of fiscal 2027.
The San Jose, California-based company provides cloud-based software that helps small and midsize businesses automate financial operations. Alongside the restructuring, BILL reported third-quarter results where revenue grew 13 percent to $406.6 million and the company swung to a quarterly profit from a year-ago loss.
The push from activist investors has intensified this year. Starboard's board nominations signaled a potential proxy fight, while reports from November 2025 indicated the company was exploring a sale. Private equity firm Hellman & Friedman was reportedly in talks to acquire the company in February 2026, though no deal was announced.
The aggressive cost-cutting and large buyback may appease activist investors focused on profitability over near-term growth. Investors will now watch for improved margins in subsequent earnings reports, with the first full quarter post-restructuring being a key test of the new plan's effectiveness.
This article is for informational purposes only and does not constitute investment advice.
