US-based chief executive Sukhinder Singh Cassidy’s year of “foundational change” at the New Zealand cloud accounting company Xero delivered better-than-expected profits and strong revenue growth.
“It’s been a year of change at pace and evolution at pace,” Singh Cassidy told The Australian Financial Review.
“We had to reset the cost base, right-size teams and bring in new capabilities including a lot of new executives.”
Shares in the global small business platform jumped 9 per cent on Thursday and delivered an after-tax profit of $NZ174.6 million for the full year ended March 31. This profit compares to a loss of $NZ113.5 million last financial year, beating the average analyst forecast of around $NZ160 million.
Xero’s total subscriptions grew from 3.74 million to 4.16 million (about 10 per cent growth) over the year and the average subscriber revenue went up 14 per cent.
In terms of bringing in new executives, Singh Cassidy has recruited executives including Uber’s former marketing executive Mike Strickman, Square’s former global sales boss Ashley Grech and Xero’s product and technology chief Diya Jolly.
“It was good to get this foundational year of change under our belt and to bring in the capabilities we’re going to need to deliver the future,” Singh Cassidy said about her first full financial year as chief executive.
Taking over from former chief executive of Xero, Steve Vamos, in February 2023, Singh Cassidy was one of only six women to be appointed lead ASX100 companies that year.
Prior to this, she has held many leadership positions at large firms, including president at StubHub, Founder and CEO of Joyous, CEO of Polyvore and President of Asia Pacific and Latin America Operations at Google.
Speaking to the ABC, Singh Cassidy said the future is looking bright for Xero as the company continues to support small and medium-sized businesses with payroll and accounting software for bookkeepers.
The company plans to grow its investment in artificial intelligence and begin to experiment with chat AI, including an AI chatbot called JAX (Just Ask Xero), that users can communicate with via WhatsApp and request it chase unpaid invoices or charge clients a late fee.
“The thesis of JAX is– we already do a lot of traditional AI machine learning– it’s to take those conversational interfaces to wherever our customers are doing their work,” said Singh Cassidy, noting that the early feedback to investors has been positive.
Singh Cassidy has also spoken about how Xero’s allocation of capital moving forwards will be intentional and they aren’t afraid to pull back on investments. She told The Australian that Australia, the UK and the US were the company’s key markets as they plan to double in size and seek more balance between subscriber growth and average revenue per use.