Xero Limited (ASX: XRO) announced its H1 FY24 earnings, showcasing robust revenue growth and a move toward profitability. Operating revenue surged by 21% (20% in constant currency), reaching AU$799.5 million. The company's strategic cost management and restructuring efforts led to a notable 90% rise in EBITDA to AU$206.1 million compared to H1 FY23. With a focus on balancing growth and profitability, Xero achieved a significant increase in free cash flow to AU$106.7 million, marking a 13.3% free cash flow margin, a substantial improvement from the prior 2.4%.
Notably, the net profit rose to AU$54.1 million, a considerable upturn from the net loss of AU$16.1 million in the previous period. Xero's subscriber base grew by 13% to 3.95 million, driving the annualised monthly recurring revenue (AMRR) up by 19% to AU$1.8 billion (22% in CC). Additionally, the total lifetime value (LTV) increased by 14% (17% in CC) to AU$14.8 billion, reflecting customer trust amid changing economic landscapes. Average monthly churn stayed low at 0.94%, while average revenue per user (ARPU) improved by 6% (8% in CC), underscoring customers' confidence in Xero for their business management needs.
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Nextgen Global Services Pty Ltd trading as Kapitales Research (ABN 89 652 632 561) is a Corporate Authorised Representative (CAR No. 1293674) of Enva Australia Pty Ltd (AFSL 424494). The information contained in this website is general information only. Any advice is general advice only. No consideration has been given or will be given to the individual investment objectives, financial situation or needs of any particular person. The decision to invest or trade and the method selected is a personal decision and involves an inherent level of risk, and you must undertake your own investigations and obtain your own advice regarding the suitability of this product for your circumstances. Please be aware that all trading activity is subject to both profit & loss and may not be suitable for you. The past performance of this product is not and should not be taken as an indication of future performance.
