Shares of Bill Holdings Inc. seesawed in after-hours trade on Thursday, as strong quarterly results ran up against questions about the business-assistance software platform’s more upbeat profit outlook following steep cuts two months ago, amid continued caution on spending among its small-business customers.

Shares fell about 3% in extended trading, after initially jumping 15% following the closing bell. Shares of Bill are down 24.2% over the past 12 months.

For its full year, which ends on June 30, Bill said it expected sales of between $1.23 billion and $1.25 billion, with the midpoint just above FactSet forecasts for $1.23 billion.

The company, which makes automation software to help small and medium-sized businesses handle their payments and expenses, forecast adjusted earnings per share of $2.09 to $2.31, above forecasts for $1.88. It forecast adjusted net income of $245 million to $270 million.

That outlook was better than the one it gave in November. But it might not have been enough for some investors, after Bill in December said that it would slash its workforce by around 15%. It also said at time that it would close its office in Sydney, Australia.

Wells Fargo analysts on Thursday said they expected more from those cuts than the company forecast.

“While Bill posted sound results, we highlight that the majority of the beat was not passed through to the FY24 guidance raise and continue to see the task of dispelling the bear case as a multi-quarter endeavor,” they said.

The after-hours rally, then selloff, came as small businesses remain reserved over borrowing money and expanding operations, after higher interest rates and tougher credit standards posed a bigger threat to them than their larger corporate counterparts last year.

For its fiscal second quarter, Bill on Thursday reported a net loss of $40.4 million, or 38 cents per share, compared with a net loss of $95.1 million, or 90 cents a share, in the second quarter of the prior fiscal year.

Adjusted for things like stock-based compensation, restructuring, depreciation and amortization, Bill earned 63 cents a share during that quarter, topping expectations for 40 cents. Sales jumped 22% to $318.5 million, above expectations for $299 million.

Bill said it expected third-quarter sales of $299 million to $309 million, with the midpoint above FactSet estimates for $302 million. The company said it expected third-quarter adjusted earnings per share of 48 cents to 57 cents, compared with estimates for 43 cents.

Some analysts have said potential rate cuts from the Fed could take some pressure off smaller firms contending with more debt.

But Chief Executive René Lacerte on Thursday said that the broader backdrop for small and medium-sized businesses remained “challenging” and that those businesses “continued to carefully manage their spend.”

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