Xero Limited has recently provided details on its global AI and US payments opportunities. A briefing conduced provided information regarding Xeroʼs multiple AI agents operating under JAX on Xero.com and Melioʼs multi-channel payments offerings on Melio.com, Xero.com, and its syndication network.
During the briefing, Xero CEO Sukhinder Singh Cassidy said: “We are deeply focused on capturing the global AI and US accounting plus payments TAM. Xero is well positioned to shepherd SMBs into the AI era and take advantage of this technology. We are already a trusted system of record and are now orchestrating multiple agents to evolve into the key system of action and decision making for our customers. Combined with our deep domain knowledge, unique data platform and go-to-market strengths, we have a clear AI strategy that supports our long-term growth opportunity. With Melio, we are executing well on our Win the 3x3 strategy by uniting accounting with payments on one platform to drive deeper value for SMBs, along with increasing scale and gross profit dollar growth. This will allow us to drive enhanced customer unit economics and stronger US growth.”
As a global SaaS business, long powered by machine learning and AI, Xero is well placed to capture the TAM expansion opportunity presented by AI as a trusted system of record with deep data on key small business Jobs to be Done (JTBD). To date, more than two million subscribers are benefitting from using Xeroʼs full AI features, with over 300,000 using Xeroʼs newer GenAI features previously announced at Xerocon Brisbane.
Xero plays a critical role in helping SMBs realize the promise of AI by moving beyond a system of record to a system of action and decision making. This is made possible by Xeroʼs unique position of strength and foundational advantages including:
● Data: A powerful, deep system of record with first and third party data
● Platform: Xero supports the core JTBD for small business in one place
● Scale and domain expertise: Deep vertical expertise and breadth across the core JTBD for small business, delivering an AI-enabled platform experience for customers
● GTM engine: A strong and established partnership with accountants and bookkeepers supporting its GTM engine across 4.6 million subscribers
To execute on these advantages Xero has a clear AI strategy focused on four key pillars, which are already delivering benefits to customers.
In FY27, Xero will focus on driving usage and adoption of AI, deepening AI value in its products and monetizing new AI features. Xero has three principles for AI monetization: simplicity, encouraging adoption and considering future usage evolution.
Melio: strengthening Win the 3x3, driving US scale and stronger unit economics
Bringing together accounting with payments by acquiring and integrating Melio gives Xero a strong opportunity to win more US SMBs and expand ARPU, accelerate US growth and deliver stronger unit economics. Following completion in October 2025, Xero has moved quickly to integrate Melio into its US business with strong progress to date including:
● Successfully embedding Melioʼs basic bill payments functionality into the Xero platform
● Unifying the go-to-market teams
● Consolidating Xeroʼs and Melioʼs US offices with shared services migration underway to realize operational synergies
The united Xero–Melio proposition diversifies Xeroʼs US revenue model to capture a greater share of SMB BillPay revenue, which Xero has provided new detailed disclosures for, including metrics 3reflecting:
● Adoption and usage of payments, across Xero and Melioʼs direct customers measured through Total Payment Volume (TPV) processed and gross take rate
● Growth in US direct customer ARPU
● Growth in absolute US gross dollar profit per customer, which will support US investment opportunities
Xero has also provided additional guidance on Melio, aligned with its existing FY28 aspirations communicated at the time of the Melio acquisition. This guidance underpins Xeroʼs confidence in pursuing the significant US TAM opportunity.
Outlook & Aspirations(Summary content only)
Melio is expected to reach Adjusted-EBITDA breakeven on a run-rate basis in H2 FY28.
At its FY26 results announcement in May 2026, Xero will transition to providing forward guidance on an Adjusted-EBITDA basis.
Xero re-affirms its FY28 aspirations outlined in June 2025, as part of the acquisition, including (1) the combined business is expected to significantly accelerate US revenue growth and gives Xero the opportunity to more than double its FY25 group revenue in FY28 excluding anticipated revenue synergies, and (2) that the outcome is expected to support Xeroʼs aspiration to deliver greater than Rule of 40 outcomes for the group in FY28.
Product Information
A product demonstration can be accessed at: https://webcast.openbriefing.com/xro-ann-2026/
Disclosures:
Content has been summarized from a Market Release furnished by Peppercomm on behalf of Xero. Some changes have been made to shorten the profile of this feature, remove information requiring background and footnoted content, and otherwise summarize the details which are available here.
Insightful Accountant published this feature for educational and informational purposes only. This is NOT sponsored content.
Xero is a global small business platform that helps customers supercharge their business by bringing together the most important small business tools, including Accounting, Payroll, and Payments, on one platform. Xero’s powerful platform helps customers automate routine tasks, gain timely insights, and connect with their data, apps, and accountant or bookkeeper, so they can focus on what really matters. Trusted by millions of small businesses, accountants, and bookkeepers worldwide, Xero makes life better for small businesses, their advisors, and communities around the world.
Any other trade names or references used within this feature may refer to registered, trademarked, or copyrighted materials held by their respective owners and are included only for informational and educational purposes.
This feature is NOT sponsored content. The article is provided for informational and educational purposes. Publication of this article does not represent a formal endorsement by Insightful Accountant. The author's opinion and commentary (if any) may differ from that of Insightful Accountant. The headline image is an AI-generated graphic produced by HubSpot.
Note: Registered Trademark ® and other registration symbols (such as those used for copyrighted materials) have been eliminated from the articles within this publication for brevity due to the frequency or abundance with which they would otherwise appear or be repeated. We attempt to credit such trademarks or copyrights within our respective article footnotes and disclosures.