Xro - xero

[OldGuy]

If they can't close the gap between revenues and costs in the next year or two, I can't see this EVER being profitable. Been saying this for years, and not surprised to see it come true.

[mikeybycrikey]

The comments about the widening loss might be interesting, if the size of the loss was unexpected.

Still no indication of when they are going to be profitable, but they are saying that "Xero is managing the business to cash flow break-even within its current cash balance".

They currently have $184 million so with the current cash burn of $90m in FY2016, I'd expect them to be cashflow neutral within 3 years, I guess. With capitalising expenses I'd expect profit to be slightly sooner than that.

Or maybe I'm being too optimistic. Australian growth seems to have leveled off more than I expected.

[OldGuy]

The american subscriber numbers say it all. Only 62,000. How many tens of millions have they spent chasing those??

[Leftfield]

The american subscriber numbers say it all. Only 62,000. How many tens of millions have they spent chasing those??

Still early days in USA. XRO notes that "Major US banking integrations (are planned/extected) in coming months" This is a big one. Until the banks allow integration of their statements to XRO clients reconciliations, then progress will be slow. Integration with banks is a MAJOR benefit for XRO clients. In the UK XRO was one of the first to provide such integration and now is mkt leader.

Currently both USA and UK customers growing at over 50%. Thats pretty dam good.

[Longhaul]

Currently both USA and UK customers growing at over 50%. Thats pretty dam good.

77% and 60% respectively by my figures.

Actually it would be really interesting to compare the growth charts of US and UK to NZ and AUS in their early years....

Maybe when I have some time I will give it a go.

*Anyone know if we can tune into the investor presentation?

[OldGuy]

wow, talk about head in the sand. What is the cost of acquiring these antipodean customers relative to potential earnings?

Also, high growth rates are very easy to achieve from a small base. I think the absolute numbers are more important in terms of likely profitability going forward.

Happy not to be holding this one.

[Leftfield]

77% and 60% respectively by my figures.

Actually it would be really interesting to compare the growth charts of US and UK to NZ and AUS in their early years....

Maybe when I have some time I will give it a go.

*Anyone know if we can tune into the investor presentation?

Investor presentation available via NZX. This image shows how the USA is tracking and shows slow USA acceptance of Cloud computing and bank statement integration benefits (Crikey they still use cheques over there!)Attachment 8031

[OldGuy]

is that velocity chart expressed in absolute terms (i.e. number of subscribers)? If so, they should just quit the states RIGHT NOW.

[Beagle]

As the company grows, what is it now 9 years ?, so do the losses. Its the same year in year out so please forgive me if I've posted this before. I am amazed that people still believe in the business model.

If a business is growing at some point there should be a sign that losses diminish and it turns profitable as the company obtains critical mass with the resulting efficiencies. As it grows there is no real sign that normal efficiencies are materialising so it would appear nobody can reliably say if or when this will occur either from within or outside the company. Highly speculative with very high risk. I will continue to avoid until they can prove their business case is profitable. Despite company claims I think shareholders can brace themselves for yet another capital raise in the next year or two.

[RGR367]

You either like it or not but still looking good as far as my acceptance of the report is concern. And why quit US of A when it's tracking very similar to almost all the other markets.