Xero Limited (XRO) Q4 2026 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good morning from Sydney, Australia. Thank you for joining our investor briefing today covering Xero's financial and operating results for the full year ending the 31st of March, 2026. I'm Sue Kinderson-Cassidy, CEO of Xero, and I'm joined by our CFO, Claire Bramley. In FY26, Xero delivered strong revenue growth of 31%, added more than 500,000 new customers, and generated $757 million in adjusted EBITDA. We did this while closing and integrating Melio, which speaks to what this business can do when strategy and execution are aligned. There are three key themes to our FY26 performance. First, sustained revenue performance, strong EBITDA outcomes, and a US business that is now clearly accelerating. Second, payments and AI innovation both scaling fast, which is deepening customer penetration and delivering real measurable value for users now, and has tremendous potential going forward. Third, continued capital and operational disciplines that underpinned our FY26 execution and gives us confidence in our ability to deliver in FY27 also. Okay, let's take a look at our financial results specifically. Operating revenue grew 31% to $2.75 billion and adjusted EBITDA rose 18% to $757 million. Claire will take you through the details shortly, but I want to draw out two things here. First, the quality of our organic story. Organic revenue growth was 21% or 19% in constant currency terms, and organic adjusted EBITDA growth was 30%. That is the underlying engine firing at zero and delivering strong returns. Second, the Rule of 40 outcome was 48.5%. This shows both the strength of our revenue growth and the quality of our free cash flow generation. On a pro forma basis, adjusting for the full year impact of Melio, it was 36%. I'll touch on this later. Now, turning to regional perfo...