What's Going On With Bill.com Stock?

Bill.com Holdings Inc (NYSE: BILL) stock rallied more than 14% in the extended session after the market closed on Thursday and are continuing the momentum in the pre-market session on Friday. The shares had closed 6.5% lower at $130.33 in the regular session on Thursday.

What Happened: The company, which makes back-office automation software for small- and mid-size businesses, reported a narrower third-quarter loss and said it is buying expense reporting startup Divvy in a deal valued at $2.5 billion. Both announcements were made in the after-hours.

The California-based company reported an adjusted loss of $1.7 million, or 2 cents per share, for the quarter ended March 31, compared with $2.4 million a year ago. The company reported revenue of $59.74 million, up 44.8% on a year-over-year basis.

In a separate release, Bill.com revealed details of its cash-and-stock deal to acquire Divvy for about $625 million in cash and $1.875 billion in stock.

The deal is expected to close by the end of Bill.com’s first fiscal quarter ending Sept. 30.

Cathie Wood-led Ark investment Management firm on Thursday bought 113,690 shares worth about $14.8 million in the company.

See Also: Cathie Wood Slashes Apple Stake To Half — Also Trims Google, Fastly: What You Need To Know

Why It Matters: The Utah-based Divvy was valued at $1.6 billion in January this year. The startup has more than 9,000 customers and offers a combination of financial software and corporate credit card for small businesses. The acquisition is anticipated to help Bill.com expand the reach with more features on its portfolio.

Price Action: Bill.com shares are trading 14.3% higher at $149 in pre-market session on Friday.