One thing the Australian share market is not short of, is tech shares growing at a strong rate.
Two exciting tech shares which have continued to grow strongly in 2020 despite the pandemic are listed below. Here’s what you need to know about them:
ELMO Software Ltd (ASX: ELO)
ELMO is a cloud-based human resources and payroll software company. Its software streamlines a range of processes such as employee administration, recruitment, remuneration, and payroll through a single a unified platform. ELMO currently has operations in both the ANZ and UK markets, which management estimates are worth $2.4 billion and $6.8 billion per year, respectively.
In respect to the latter, the company has just boosted its presence in the UK with the acquisition of UK-based Breathe for an initial payment of $32.4 million. Breathe is a fast-growing, scalable human resources platform for small businesses.
This acquisition led to ELMO increasing its FY 2021 annualised recurring revenue (ARR) guidance to be in the range of $72.5 million to $78.5 million. This is up from its previous guidance of $65 million to $70 million and represents strong growth on FY 2020’s ARR of $55.1 million.
Whispir (ASX: WSP)
Another tech share which has been growing strongly in 2020 is Whispir. It is a leading workflow communications platform provider which allows organisations to deliver actionable two-way interactions at scale using automated multi-channel communication workflows.
In FY 2020, Whispir posted a 25.5% increase in revenue to $39.1 million and ARR growth of 34% to $42.2 million. This compares to its prospectus forecast of $37.8 million and $42 million, respectively.
Pleasingly, its positive form has continued in FY 2021, with the company’s ARR lifting to $43.7 million at the end of September. This is still only scratching at the surface of a workflow communications platform as a service market which management estimates could be worth US$8 billion per year by 2024.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Elmo Software and Whispir Ltd. The Motley Fool Australia has recommended Elmo Software and Whispir Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.