Xero Limited Reports Strong Growth for H1 FY2025

Highlights:

• Xero Limited reported a 51% increase in earnings for the six months to September 30, 2024, driven by strong operational performance.
• Revenue Growth & Subscriber Increase: Operating revenue rose 25% to $995.9 million, with 186,000 new subscribers added, excluding inactive accounts.
• Higher Average Revenue per User (ARPU): Xero saw a significant increase in ARPU, reflecting both subscriber growth and higher spending from existing customers.

Earnings Surge by 51%

Xero Limited (NZX: XRO), the New Zealand-based cloud accounting software provider, has reported a remarkable 51% increase in earnings for the six months ending September 30, 2024. At the time of writing, the company revealed that its operating revenue grew by 25%, reaching $995.9 million. This strong performance highlights Xero's continued growth and market dominance in the competitive tech sector.

Strong Subscriber Growth and ARPU Increase

Xero also noted that its earnings before interest, taxes, depreciation, and amortisation (EBITDA) reached $311.7 million, reinforcing its operational efficiency. The company added 186,000 new subscribers in the first half of the 2025 financial year, excluding inactive accounts. This growth signals increasing demand for its cloud accounting solutions across global markets.

Additionally, Xero’s average revenue per user (ARPU) saw a notable rise, reflecting not only an increase in subscribers but also higher spending by existing customers. The company’s focus on expanding its product offerings and enhancing customer satisfaction has contributed to this uptick in ARPU.

Continued Strategic Expansion

The results are a testament to Xero's effective strategy of increasing its subscriber base while optimizing its revenue streams. As the company continues to innovate and expand its services, it appears well-positioned to maintain its upward trajectory in the cloud accounting software market. With these strong results, Xero remains a key player in the tech space, attracting attention from investors and customers alike.

Xero’s performance sets a strong foundation for the remainder of the 2025 financial year, with further growth expected as the company builds on its momentum.

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