How have ASX technology shares performed during the August 2021 earnings season?

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FY21 has delivered a wild ride for ASX technology shares, with investors flocking to back the winners, and the losers taking a fall.
ASX technology shares have had a mixed run this earnings season. Investors have been quick to distance themselves from companies perceived as underperforming. Equally, they've flocked to those showing signs of outperformance.

The ASX's most well-known tech shares are the WAAAX shares — the Australian equivalent to the United States' FAANG stocks. WAAAX shares comprise WiseTech Global Ltd (ASX: WTC), Afterpay Ltd (ASX: APT), Altium Limited (ASX: ALU), Appen Ltd (ASX: APX), and Xero Limited (ASX: XRO).

All except Xero reported their full-year results in August. Xero's financial year ends 31 March 2022.

How have ASX technology shares performed against the market?

The ASX share market has climbed steadily in 2021, with the All Ordinaries Index (ASX: XAO) now up 12% from 1 January.

But the performance of ASX technology shares has varied greatly. The WiseTech share price is up 59% for the year, and shares in Altium are down 6%. The Afterpay share price has lifted 9% in 2021, while the Appen share price has slumped 59%. The Xero share price is close to the levels seen at the start of the year.

The share price reactions to company results demonstrate how technology is by nature a more volatile sector of the market.

Who are the tech winners this earnings season?

The Wisetech share price shot up 28% in a day after the release of its full-year results last month. Total revenues increased 24% to $507.5 million. This was at the top end of WiseTech's guidance range of $470 million to $510 million.

The company's earnings before interest, tax, depreciation and amortisation (EBITDA) grew 63% to $206.7 million thanks to a recovery in global trade. The logistics software provider also reported a 101% increase in underlying net profit after tax (NPAT), which reached $105.8 million.

It appears disruption in the freight industry is driving demand for integrated global software solutions like WiseTech'sCargoWise platform. The company advised that…
Kate O'Brien
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