US arm of Zip Co achieves record third quarter results

Buy-now pay-later (BNPL) player Zip Co's (ASX: Z1P) US arm Quadpay has achieved record third quarter results as the company's transaction volumes more than doubled to hit $1.6 billion.

The record US results come during what Z1P describes as a "typically a seasonally quieter trading period", with Quadpay achieving $762 million in transaction volumes - up 234 per cent year on year.

In addition, Quadpay nearly tripled revenue during a period when 674,000 new customers signed up to the BNPL platform (up 153 per cent to 3.8 million customers).

Overall group revenue rose by 80 per cent year-on-year to $114.4 million, which CEO and founder Larry Diamond says represents major momentum for the company.

"Our US business was again a standout, confirming our position as truly one of the fastest growing global BNPL leaders," says Diamond.

"The resilience of the UK team is now delivering results and we look forward to a very exciting future for that region.

"Our focus on unit economics continues to provide a point of difference and points to a strong bottom line at scale."

Z1P's ANZ business also performed strongly, with transaction volume up 61 per cent in the quarter to $837.3 million.

Revenue in the region also hit a new high of $57.9 million in Q3 as Zip added more than 230,000 new customers to the BNPL platform.

Zip launched in the UK in late-2020 following a $120 million placement and the deployment of Quadpay in the region. Since then, a number of flagship merchants have signed up including Homebase, JD, Boohoo and The Fragrance Shop.

During the quarter Zip also commenced a soft launch of the platform in Canada and agreed to terms for a strategic investment into South East Asia via leading Philippines BNPL player TendoPay.

Shares in Z1P are up 10.22 per cent to $9.17 per share at 10.58am AEST.

Business News Australia