XLS is a spreadsheet file extension developed by Microsoft. XLSX, in turn, is also an MS Excel spreadsheet that represents the latest version of the previous one.
The first one is used to be the default format for Excel 2003 and older but in 2007 it was replaced by the second one. With this file type, data is stored in worksheets with cells. Such files can contain text, charts, formulas, numbers, various styles, and formatting. The format is most commonly used for creating mathematical models and storing financial data.
These files are stored as a ZIP archive with a collection of individual documents. The key difference between the new and old formats is that the first one uses Open XML while the latter, a proprietary binary format. Besides, to open the old file type a user needed to install the Microsoft Office package. The new extension solves that issue. The spreadsheets can be opened, viewed, and edited online on any device via MS Excel Online, Google Sheets, or other spreadsheet programs.
Strangely enough, the .xls extension has one advantage over its updated variant: such files can be read by all Microsoft Excel versions, while the new extension needs the 2007 or later version.