BILL Holdings Inc (NASDAQ: BILL) saw its stock price plummet 5.19% in after-hours trading on Thursday, as investors braced for the company's upcoming third-quarter earnings report. The sharp decline suggests growing anxiety among market participants about the potential outcomes of the financial results.

The significant drop comes amid heightened options activity for BILL stock. Pre-earnings options volume was reported to be 5.8 times the normal level, with puts outnumbering calls 3 to 2. This imbalance typically indicates a bearish sentiment among options traders. Moreover, the implied volatility suggests the market is anticipating a substantial 12.0% move in share price following the earnings announcement.

BILL Holdings, a provider of cloud-based software that automates back-office financial operations for small and midsize businesses, is scheduled to release its Q3 fiscal 2025 earnings after market close. Analysts are expecting earnings per share of $0.37 for the quarter. However, the significant stock drop and heightened options activity suggest that some investors may be positioning themselves for a potential earnings miss or disappointing guidance.