If it truly is XLS, and not just XLSX with an XLS extension, then its the older binary format. To convert that you would need a running copy of Office or something with the Office API. There used to be 3rd party web services that could do it, but that would also be a cost and require a custom connector which is premium. I don't think there is any way to do it with just a standard Office 365 Power Apps license.
"Plumsail Documents" is capable of converting XLS to XLSX. First of all, you need to register Plumsail Account. This account is used to manage Plumsail Documents, Plumsail Actions and Plumsail Forms products.
For more information, please go to https://docs.microsoft.com/en-us/connectors/plumsail/
If this post helps, then please consider Accept it as the solution to help the other members find it more quickly.
XLS is and has been an obsolete file format for years now. Yes you can still use it in Office for backwards compatibility but there is no reason you should expect Microsoft to support a digital format in a new product when they dropped that format a number of years ago. XLS was replaced as a file format in Office 2007. Why do you expect them to continue to build to those old standards 14 years later. And no one should be using a file format that old for sensitive files.
Yeah, I agree with all of that. Unfortunately a lot of vendors still use it and I'm not the only one asking for this functionality by a long shot.
The other Microsoft solution would be to use Power Automate Desktop instead of Power Automate. Then you can open the file in Excel and save it as XLSX.