S&P/ASX 200 Index (ASX: XJO) tech shares had another ripper year in FY25.
The S&P/ASX All Technology Index (ASX: XTX) rose by 28.88% and produced total returns of 30.07%.
The ASX All Tech Index tracks the performance of Australia's leading and emerging tech-oriented companies. It has 42 constituents.
The All Tech Index grew at almost triple the rate of the ASX 200 in FY25. The ASX 200 rose by 9.97% and delivered total returns of 13.81%.
The ASX All Tech Index also outdid US tech stocks by a factor of 2:1.
US stocks operate on a different fiscal year cycle from us, but it's still interesting to compare their performance over the same time frame.
Let's use the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) as our proxy for US tech stocks.
The NASDAQ includes shares from other market sectors besides information technology, but so does the ASX All Tech Index.
The commonality between the two indices is that they're comprised of companies that harness technology in a big way.
The NASDAQ rose by about half as much as ASX All Tech shares, lifting 14.87% over the 12 months to 30 June.
Samy Sriram, Markets Analyst at online trading platform Stake, said:
Australian tech has proven it can run with the best – and sometimes even outrun them, with the past financial year a standout for Aussie tech stocks.
Local names surged to record highs and inked billion-dollar deals, while their US counterparts stumbled under pressure from trade tensions and soaring artificial intelligence (AI) costs.
She added:
Ultimately, this is due to leading Aussie tech names thriving in their own lanes.
They're not riding the AI wave, but their high-margin software-as-a-service (SaaS) models continue to deliver.
Image source: Getty Images
Which ASX tech shares impressed in FY25?
Sriram said ASX tech stocks had rapidly risen in market capitalisation in recent years.
She points out that Australia's largest tech company by market cap, the logistics solutions software company WiseTech Global Ltd (ASX: WTC), has a similar valuation to supermarket icon Woolworths Group Ltd (ASX: WOW).
Account software provider Xero Ltd (ASX: XRO) is similarly valued to Coles Group Ltd (ASX: COL).
Following outstanding and continuous share price growth, many ASX tech shares are now included in the major indexes.
This is driving fresh inflows from institutional investors, says Sriram.
She comments:
Another example is Pro Medicus Ltd (ASX: PME) shares, the top weight in the S&P/ASX All Technology Index, has surged 137% over the past year, with its momentum fuelled by ongoing wins for its medical imaging tech.
Entry into the S&P/ASX 50 (ASX: XFL) has also boosted its institutional profile.
On Wisetech, Sriram says the company continues to lead in logistics and global trade software.
Despite governance questions, its US$2.1b acquisition of e2open opens new markets and adds US$600m in revenue.
More importantly, it puts WiseTech at the heart of a supply chain software boom expected through the decade.
The analyst describes Xero as a homegrown ASX tech share favourite with strong margins.
It's US$2.5b acquisition of Melio shows a clear intent to scale in the US.
Yes, the price tag was steep – but CEO Sukhinder Singh Cassidy says the deal could double revenue in a few years.
What happened to US tech stocks in FY25?
Sriram contrasted the performance of ASX tech shares with US stocks and the NASDAQ:
US tech has had a rough start to 2025, experiencing its worst quarter in three years.
NVIDIA Corp (NASDAQ: NVDA), the Nasdaq's largest listing, was hit after concerns DeepSeek's cut-price AI model could dent GPU demand.
Tesla Inc (NASDAQ: TSLA) shares reversed as Elon Musk's ties to the Trump administration dragged on sales and BYD stole market share.
Apple Inc (NASDAQ: AAPL) also took a hit, caught in the middle of escalating trade wars.
Also, valuations were already a sticking point for US tech at the end of last year, which has continued into 2025.
The analyst said Donald Trump's election win sparked a rally on AI and crypto optimism, fuelling fears that future earnings growth had already been priced in.
April's sharp sell-off brought valuations down to earth, though strong AI demand – seen in rebounds for Nvidia and Broadcom Inc (NASDAQ: AVGO) – kept some momentum alive.
Others, like Tesla and Apple, continue to lag.
How did the Magnificent 7 stocks perform in FY25?
Check out the share price performance of the US Magnificent 7 stocks over the FY25 period.
Interested in ASX tech shares?
Interested in individual ASX tech share tips? Here are three that brokers recommend we buy now.
Prefer to invest via exchange-traded funds (ETFs)?
Betashares offers the S&P/ASX Australian Technology ETF (ASX: ATEC).
The ATEC ETF seeks to track the performance of the ASX All Tech Index before fees.
Since its inception in 2020, the ATEC ETF has delivered an annual average return of 17.12%.
The annual management fee is 0.48%.
