Xero Raises Annual Revenue Guidance, to Launch A$1 Billion Share Buyback

By David Winning

SYDNEY--Accounting software provider Xero raised its annual guidance for revenue and profits, and said it aims to buy back shares worth up to 1 billion Australian dollars (US$690 million) over the next 12 months.

Xero said it now expects operating revenue of between 3.77 billion New Zealand dollars (US$2.11 billion) and NZ$3.83 billion in the 12 months through March. That was higher than the company's original guidance for NZ$3.62 billion-NZ$3.73 billion.

It attributed the upgraded guidance to a stronger performance from business-to-business payments platform Melio, which Xero acquired in 2025 in a bid to accelerate its U.S. expansion, and a weaker New Zealand dollar. It forecast revenue growth at 24-27% when currency swings are stripped out.

Xero also narrowed its guidance range for annual adjusted earnings before interest, tax, depreciation and amortization--or Ebitda--to between NZ$880 million and NZ$920 million, from an earlier forecast of NZ$860 million-NZ$920 million.

"Second half adjusted Ebitda will reflect the benefit of announced price rises and payments growth momentum, disciplined headcount cost management and further operating efficiencies, and an expected reduction in Melio's adjusted Ebitda losses," Xero said.

The revised outlook was provided alongside an 86% fall in first-half profit to NZ$18.5 million. Revenue rose by 46% to NZ$1.75 billion in the six months through September, but the bottom line was weighed by Melio.

Xero continues to expect Melio will start breaking even by March 2028.

The average analyst forecast had been for a net profit of NZ$55.8 million from operating revenue of NZ$1.74 billion, according to data compiled by Visible Alpha.

Xero did not pay a dividend, but announced the share buyback as it looks to manage its capital position.

"We believe current market valuations do not fully reflect Xero's long-term value and growth potential with our strong financial position allowing us to execute this up to A$1 billion share buy-back program while continuing to fully fund our strategic growth priorities," Chief Executive Sukhinder Singh Cassidy said.

Write to David Winning at david.winning@wsj.com

(END) Dow Jones Newswires

November 11, 2026 16:35 ET (21:35 GMT)