Xero hits close to $NZ90m in subscription revenue for 2015

Xero hits close to $NZ90m in subscription revenue for 2015

Falls just short of the 600,000 subscriber mark for the year

Xero chief executive, Rod Drury

Xero chief executive, Rod Drury

Online accounting platform provider, Xero (NZX: XRO; ASX: XRO), has reported its half-yearly earnings to September 30, 2015.

The company reached 593,000 paying subscribers, an increase of 222,000 from the same time in 2014, and subscription revenue of $NZ89.8 million.

Xero Limited Chief Executive, Rod Drury, said the New Zealand-based company delivered strong global growth while improving operating metrics, reflecting positive overall business performance.

“Xero continues to grow its capability while delivering strong results. We have built a world-class team at all levels of the business who demonstrate disciplined execution to deliver on the global growth opportunity,” he said.

Highlights of the last year include the successful completion of the CFO transition to Sankar Narayan; broadening responsibilities of CMO, Andy Lark, to encompass global marketing, sales, partnerships and education; and the appointment of Tony Stewart to the newly established role of Chief Data Officer.

“Over the past year, Cloud market adoption has accelerated and Xero has strengthened its market position, continuing to be one of the fastest growing SaaS companies in the world.

“The substantial investments in building our team and internal capability is seeing us deliver innovation at a rapid cadence for Xero’s customers. Our global market position has attracted high-value partnerships with world-leading technology companies, financial institutions and banks, giving small businesses access to sophisticated cloud platforms and services once only available to big business,”.

According to a company statement, operating metrics are expected to improve in the coming year as it continues to improve automation and economies of scale in cost-to-serve, customer acquisition and product development.

“We’ve achieved strong growth for the first half and we’re on track to achieve $NZ200 million subscription revenue based on June 2015 foreign exchange rates this financial year. Xero is focused on containing its full financial year cash outflow to similar levels to the prior financial year. This growth as well as the rigour that we have established within the business positions Xero for long term value creation,” Drury said.

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