Zip Co Hits Record Earnings and Raises Guidance as US and ANZ Growth Accelerates

Zip Co Limited shared reported an update on 17 April 2026 covering performance for the quarter ended 31 March 2026.
The company delivered improved earnings and an upgrade to its full year guidance.

ZIP Co Ltd (ASX: ZIP) 

shared its 3Q FY26 update for the period ending 31 March 2026 and reported strong growth across key areas. Cash EBTDA reached a record $65.1m which is a rise of 41.5% from the same quarter last year. 
Operating margin improved to 19.4% from 16.5%. Total transaction volume climbed to $4.0b showing a 22.4% increase. Income also moved higher to $335.2m up 20.2%. The number of transactions grew to 27.4m whereas customers reached 6.5m. Merchant numbers increased to 93.9k. 
Net bad debts stood at 1.9% of TTV compared to 1.6% earlier. Revenue margin slightly reduced to 8.4% due to higher contribution from the US market. Net transaction margin stayed stable at 3.9%.

Regional Momentum

The company continued to improve profitability through scale and efficiency. Margin expansion shows better cost control and stronger unit economics. 
Growth remained stable in both regions supported by better customer engagement and consistent execution. 

In the US market transaction volume growth reached 43.1% in USD terms. Customer base increased by 9.0% and merchants rose by 17.9%. A new Pay-in-2 option was introduced to support smaller purchases. Credit losses stayed within the target range and are expected to fall below 1.75% in the next quarter. 

In Australia and New Zealand revenue increased by 5.0% and receivables rose by 8.7%. A new product called ZMobile was announced in April 2026 adding a fresh revenue stream.

United States Business Details

In the US business strong growth came from both new and existing users across app and in-store channels. The spending in everyday categories like groceries and utilities played a key role. Loss levels remained steady despite seasonal changes. Pay-in-8 losses have already peaked and are now declining. Customer engagement improved with higher spending and more transactions per user. Average spend rose by 32.3% and transaction frequency increased by 21.6%. Newer customer groups are showing better payback trends. 

The Pay-in-2 product launched in February saw early positive results with low loss signals. Merchant count reached 29.0k supported by new additions through Stripe. The company also expanded its use of AI tools with most staff actively using them and formed a partnership with IXOPAY.

ANZ Performance and Outlook

In the ANZ region steady progress continued with transaction volume growing 4.8%. Revenue growth slightly exceeded volume growth showing better conversion. Excess spread improved to 9.1% helped by lower funding costs and reduced credit losses. Customer activity strengthened with higher spend and transaction levels. Credit limits for new Zip Plus users increased from $8,000 to $20,000 giving more flexibility. Merchant numbers grew to 64.9k with expansion into new sectors. 
The company upgraded FY26 cash EBTDA guidance to at least $260.0m. Cash balance stood at $405.1m with available liquidity at $234.8m. A share buyback program began in March 2026 with $21.0m already used to purchase shares.

(Source: Company Report)