Sydney, June 19, 2026, 06:03 AEST
- Xero ended Thursday at A$71.64 after dropping A$2.94, or 3.94%. The stock’s loss added to its decline for 2026.
- The S&P/ASX 200 slipped 0.62% with tech and resource names weaker.
- Wall Street bounced back overnight, setting up a stronger start for Australian shares on Friday.
Xero shares are set to start Friday trading close to their lowest mark in a year after sliding 3.94% to A$71.64 on Thursday. The accounting software stock touched A$71.26 intraday and is now up just 5.5% from its 52-week low of A$67.93. Xero is down 37.1% in 2026.
S&P/ASX 200 fell 55.2 points to end at 8,911.1, and the All Technology Index dropped 0.52%. Xero lagged both. The stock’s move was part of a broader pullback, not just a stock-specific drop.
Tech names dragged as bond yields climbed after the Federal Reserve took a hawkish line, IG market analyst Tony Sycamore said. More selling came in as investors dumped losing positions ahead of Australia’s June 30 tax deadline. Higher yields weigh on growth stocks, since future profits get discounted harder. WiseTech Global dropped 3.79%. Seek shed 3.44%.
Some fund managers are looking at the drop as a chance to buy. Bruce Williams at Elston Asset Management said, “The most notable addition this quarter was Xero Limited.” Williams pointed to Xero’s spot in Australia and Britain, its possible operating leverage, and its room to make more money from Melio’s payments network. He said small-business clients are still pretty sticky. Livewire Markets
Xero’s valuation isn’t holding up the stock. Investors want hard proof that bigger sales, moves into the U.S. and more AI spending will actually deliver strong margins and cash. As it stands, global rate moves seem to steer the daily action.
Xero’s May numbers offered fuel to bulls and bears. Revenue for FY26 jumped 31% to NZ$2.753 billion and adjusted EBITDA climbed 18% to NZ$757.4 million. Net profit slid 27%, though, as gross margin narrowed by 5.1 points to 83.9%. Xero projected FY27 revenue between NZ$3.62 billion and NZ$3.73 billion, and sees adjusted EBITDA at NZ$860 million to NZ$920 million. The board approved up to A$550 million in share buybacks to offset share dilution tied to employee programs. “Strong EBITDA growth while absorbing Melio,” CEO Sukhinder Singh Cassidy said.
Xero said in June 2025 it would acquire U.S. payments firm Melio for US$2.5 billion, with the deal partly funded by a A$1.85 billion share sale to institutions. The company aimed to get bigger in the U.S., where it made about 7% of total sales.
The risks are still out there. If rates stay high, Xero may stay stuck with a lower multiple. Melio integration could slip, or new AI-focused rivals could slow the margin rebound. Top-line gains won’t change the story on their own—investors want to see payments growth turning into profit, not just more costs for longer.
Overseas markets picked up steam after Australia wrapped up trading. The S&P 500 pushed about 1% higher and the Nasdaq gained 1.55% late Thursday, led by semiconductor names. Oil prices pulled back, which took some heat off inflation worries. Eric Johnston, chief equity and macro strategist at Cantor, said chip stocks, cheaper oil and investors rethinking the Fed outlook spurred the move.
Friday is a regular trading day on the ASX. U.S. markets are shut for the Juneteenth holiday, so trading may see less new direction late in the session. Xero is eyeing Thursday’s A$71.26 low—if it breaks that, A$67.93, the annual low, is next up. If the stock gets back above A$74.58, which was Thursday’s close, it erases the recent drop.
