Xero reported major subscriber growth last half, with net profit rising.
Net profit was NZ$132.7 million last half, up from $120.56 million year-over-year. Subscribers reached 4.41 million, rising by 6% and driven by growth across all regions except North America.
“Xero has delivered a strong result for FY25, demonstrating our macro-resilient growth and effective execution of our strategy,” Xero wrote in a letter to shareholders.
“As we enter FY26, we'll continue to focus on executing our strategy and helping small businesses and their advisors thrive. Our goals are clear: to keep building great experiences for our customers, to allocate our resources purposefully and to live our purpose consistently.”
Operating revenue reached $1.11 billion last half, compared with $914.2 million in the second half of fiscal year 2024.
Revenue in Australia grew 24% over the fiscal year, reaching $955 million. Subscriber numbers increased 9% in the region, Xero’s largest market.
Total operating expenses were 72.3% of revenue last half, up from 68.2% one year ago, though across the fiscal year this percentage declined from 73.3% to 71.8%.
Operating income was $186.3 million, falling from $188.3 million in H2 2024. Gross profit was $985.9 million, above the $811.5 million seen one year ago.
The company’s FY2026 outlook projects total operating expenses will be around 71.5% of revenue, with a higher percentage in the year’s first half.
Xero’s (ASX: XRO) share price closed at A$173.86, down from its previous close of $174.38. Its market capitalisation is $26.7 billion.
