Xero Limited (XRO) Earnings Call Transcripts

Xero Limited's Latest Earnings Call - May 14, 2026

Xero Limited reported strong financial performance for FY 2026, with a 31% increase in operating revenue to $2.75 billion and an 18% rise in adjusted EBITDA to $757 million. The company added over 500,000 new customers, driven by the integration of Melio and accelerated growth in the U.S. market. Management highlighted a 48.5% Rule of 40 outcome, indicating robust revenue growth and cash flow quality. Guidance for FY 2027 projects revenue between $3.62 billion and $3.73 billion, with adjusted EBITDA between $860 million and $920 million, signaling continued growth momentum.

Reported metrics

Guidance from management

For FY 2027, Xero expects revenue between $3.62 billion and $3.73 billion and adjusted EBITDA between $860 million and $920 million. The company aims to exceed the Rule of 40 by FY 2028.

What management said

Yes. And I think maybe I'll just add into that specifically to the revenue guide that we've given for fiscal '27. We -- the impact of specific incremental AI monetization is fairly small. So we have a lot of confidence to be able to deliver that revenue growth with all of what Sukhinder just mentioned, underlying strong momentum as we exit fiscal '26, but the reliance on the incremental AI monetization is on the smal...

Bob, one last thing I want to make -- sorry, it's Sukhinder again. One last thing I want to make clear that may or may not be clear to maybe less sophisticated investors in Xero. You'll note that we went from ARPU to RPC in our latest investor pack to make clear that we are not a seat-based pricing model. I think this is quite important. So it was a subtle shift, but hopefully, our regular investors picked up on it...

What analysts pressed on

Analysts questioned the impact of increased U.S. brand investment on margins and the timeline for achieving Rule of 40. Concerns were also raised about the competitive landscape in AI partnerships and the potential dilution of Xero's brand presence.

Main topics on the call

• Revenue Growth — Xero achieved a 31% increase in operating revenue to $2.75 billion, with organic revenue growth of 21%. The U.S. market showed significant acceleration, with organic growth reaching 30%.
• U.S. Market Expansion — The U.S. market is a standout, with revenue reaching NZD 530 million, up 50% on a pro forma basis. Management plans to increase brand investment by AUD 55 million to sustain growth momentum.
• AI and Payments Innovation — Xero is scaling its payments and AI innovations, with Melio contributing significantly to revenue growth. The company is also integrating AI features into its offerings, aiming to monetize these in FY 2027.
• Operational Efficiency — Operating expenses as a percentage of revenue decreased to 70.5%, reflecting improved operational efficiency. Revenue per FTE increased by 21% year-on-year.

Read the full Xero Limited transcript (May 14, 2026) → Summary generated from the call transcript; every figure above is stated by management on the record.

Earnings Call History

EarningsCalls.dev has 23 Xero Limited earnings call transcripts on record, spanning May 14, 2020 to August 26, 2026. Based on this history, Xero Limited reports quarterly. The most recent call on file is dated August 26, 2026. The full list is below — each row opens the complete, free-to-read transcript.

Ticker

XRO

Exchange

ASX

Country

AU

Sector

Information Technology

Industry

Software

Calls on record

23

First call

May 14, 2020

Most recent

August 26, 2026

Reporting cadence

quarterly