Xero Shares Slide Despite Strong Year
Xero shares have tumbled more than 10 per cent at ASX opening despite continued revenue and subscriber growth.
The New Zealand-based fintech company saw shares drop to $121.29 this morning, with other tech stocks like Afterpay also sliding, as reported in the Australian Financial Review.
This is despite a year of growth for Xero, which saw an 18 per cent year-on-year increase in revenue in its full-year 2021 results to $848.8 million NZD ($786.8 million AUD). Total subscribers increased 20 per cent to 2.74 million, while net profit was up $16.4 million NZD ($15.2 million AUD) to $19.8 million NZD ($18.4 million AUD).
According to Xero CEO Steve Vamos, the company was boosted over the year by its response to customer needs during the pandemic, as well as acquisitions of Planday, Tickstar and Waddle.
“The past year has brought home to many people in small business the need to understand in real-time their financial position and how it may change. The value and importance our customers place on their subscription and connection to the broader Xero community is increasing.
“Looking ahead we believe small business will be a major driver of economic recovery in a post-pandemic world. Small businesses make up more than 90% of businesses in the markets Xero operates in, and represent a significant contribution to economic activity, jobs, and the community,” he said.
Australia remains Xero’s biggest market, with 1,115,000 total subscribers – a 22 per cent increase year-on-year.