And, of course, the second function would just move the character
class into the non-greedy search:

B replace('THEN THE CURTAIN','(^.*?[AEIOU]).*$','$1')

... returns "THE".

<xsl:stylesheet xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
B  version="3.0"
B  xmlns:xs="http://www.w3.org/2001/XMLSchema"
B  xmlns:mf="http://example.com/mf"
B  exclude-result-prefixes="#all">

B  <xsl:function name="mf:extract" as="xs:string*">
B B B  <xsl:param name="input" as="xs:string"/>
B B B  <xsl:variable name="match"
select="replace($input,'(^.*?[AEIOU]).*$','$1')"/>
B B B  <xsl:sequence
B B B B B  select="if ($input)
B B B B B B B B B B B B B  then ($input, mf:extract(substring-after($input,
$match)))
B B B B B B B B B B B B B  else ()"/>
B  </xsl:function>

B  <xsl:template match="/" name="xsl:initial-template">
B B B  <xsl:sequence select="mf:extract($input)"/>
B  </xsl:template>