Highlights

  • Zip Co (ASX:ZIP) delivered a record FY26 result with strong transaction growth and improved profitability.
  • Cash EBTDA increased 57.9% to $268.9 million, highlighting the company’s Earnings expansion.
  • The US Business remained a key growth driver, supported by higher transaction volumes and customer growth.
  • Investor attention remains on FY27 targets, Credit performance and continued profitable expansion.

Buy-now-pay-later company Zip Co (ASX:ZIP) continues building its position in the digital payments sector following a record FY26 result that highlighted strong earnings growth and accelerating US operations. The company has focused on shifting towards sustainable profitability while expanding its customer base and merchant network across key markets.

FY26 Performance

Zip reported total transaction Volume of $16.7 billion in FY26, representing growth of 27.2%, while Revenue increased 24.6% to $1.347 billion.

Cash EBTDA increased 57.9% to $268.9 million, while statutory net profit after tax rose 45.7% to $116.4 million. The result marked a significant improvement in profitability and reflected the scaling of the company’s operations.

US Growth

The United States remained a major growth driver for Zip during FY26, with US total transaction volume increasing 42.5% in US-dollar terms.

US revenue increased 37.3% in Australian-dollar terms to $903.1 million, supported by growth in active customers and merchant relationships. The company continues focusing on expanding its presence in the US instalment-payments market.

Business Strategy

Zip has continued transitioning from a growth-focused Fintech company towards a more disciplined and profitable business model.

The company’s strategy centres on expanding its payments platform, improving margins and maintaining sustainable growth. The increasing contribution from the US business has become an important component of the company’s broader expansion strategy.

FY27 Outlook

Zip has outlined FY27 targets including cash EBTDA of approximately $340 million, operating margins of 20–22% and US total transaction volume growth of more than 30% in US-dollar terms.

The company’s ability to deliver against these targets will remain an important measure of future progress. Investors will continue monitoring whether growth momentum, particularly in the US market, can be maintained alongside profitability improvements.

Management Strategy

Management has continued highlighting the company’s record FY26 performance, US expansion and focus on sustainable profitability.

Zip’s strategy remains centred on disciplined growth, improving operational efficiency and strengthening its position in the buy-now-pay-later market. Future updates will provide further insight into customer growth, credit performance and Margin expansion.

Future Outlook

Key factors to monitor for Zip include US business growth, progress towards FY27 earnings targets, credit quality and consumer spending trends.

The company’s future performance will also depend on competitive conditions within digital payments, funding costs and regulatory developments affecting the buy-now-pay-later sector.

Key Risks

Zip faces risks associated with consumer credit conditions, funding costs and competition within the digital payments market.

A deterioration in borrower credit quality could affect Loan performance, while regulatory changes may influence the operating environment. As a high-growth fintech company, Zip is also sensitive to changes in investor sentiment and valuation expectations.

Conclusion

Zip Co (ASX:ZIP) delivered a record FY26 performance, supported by strong transaction growth, a 57.9% increase in cash EBTDA to $268.9 million and continued expansion in the US market. The company’s next phase of growth will depend on executing its FY27 targets, maintaining credit quality and sustaining profitability as it expands its digital payments platform.