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Xero Limited (ASX:XRO)

ALERT: Price-sensitive ASX Announcement for XRO
Current share price for XRO : $68.270 -71.73 (-51.24%)+
Announcement
Release
13 Nov 2025 8:12AM
Price at Release
$140.000
Full Release
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Summary
In the first half of fiscal year 2026, Xero Limited reported a 20% increase in operating revenue to NZD 1.2 billion, marking a significant growth compared to the previous year. The company successfully added 176,000 net new subscribers, bringing the total to 4.59 million, and achieved an increase in average revenue per user. Xero also demonstrated strong cash flow generation with a free cash flow margin expansion. The acquisition of Melio has helped Xero to extend its market presence in the US and fostered the integration of new technological capabilities, like the AI financial superagent JAX. The company's focus on maintaining a Rule of 40 outcome and managing operating expenses efficiently has been pivotal to its strategic execution, ensuring continued growth and resilience.
Key Points
  • Xero's operating revenue grew by 20% to NZD 1.2 billion in H1 FY26 compared to H1 FY25.
  • The company added 176,000 net new subscribers during the period, increasing the total to 4.59 million.
  • Average revenue per user (ARPU) increased by 15% to NZD 49.63.
  • Xero generated free cash flow of NZD 321.1 million, with a free cash flow margin of 26.9%.
  • Xero achieved a Rule of 40 outcome of 44.5%, highlighting strong financial performance.
  • The Melio acquisition supported the expansion of Xero's capabilities in the US market.
  • Xero's AI financial superagent JAX was enhanced to offer new features like automated bank reconciliation.
  • Operating expenses as a percentage of revenue is expected to be around 70.5% for FY26.
IMPORTANT NOTE: This information is autogenerated and has not been reviewed for accuracy or completeness. You should refer to the full announcement here for further information.