Zip (ASX:ZIP) Surges 10% on April Update: Strong US Momentum and Clear FY25 Outlook Lift Confidence in ASX 200

May 07, 2025 01:55 PM AEST | By Team Kalkine Media

Google News:

Zip (ASX:ZIP) Surges 10% on April Update: Strong US Momentum and Clear FY25 Outlook Lift Confidence in ASX 200 — Image source: Shutterstock

Recent News

Fed Daly eyes fall for possible policy shift

Fifth Third Announces Three-Year, $20M Investment in North Nashville

Inogen Alliance Associate Awards: Environment Analyst Sustainability D...

New Zealand Construction Report 2025: Output to Contract by 1% Due to...

Highlights

Zip (ZIP) shares surged 10% following a robust April update

Strong US growth boosts profitability and transaction volume

FY25 guidance reconfirmed, with strategic goals clearly outlined

Shares of Zip Co Ltd (ASX:ZIP) surged 10% after the company released a strong trading update for April 2025, reinforcing confidence in its ongoing transformation and performance. The update highlights accelerating growth in the United States and stable performance in both of its core markets.

Zip, a key player in the buy now, pay later (BNPL) sector, announced continued momentum in total transaction value (TTV), with the US segment posting a year-on-year TTV growth rate exceeding 40% for April. This growth, according to the company, has significantly contributed to a turnaround in group profitability. The BNPL firm emphasized that its portfolios remain stable, with no material changes in credit loss performance.

A major contributor to investor optimism was Zip’s confirmation of its FY25 guidance. The company expects to deliver at least $153 million in cash EBTDA, with operating expenditure projected to rise by around 10%, contingent on market conditions. Management reaffirmed its two-year target ranges, signaling confidence in the company’s strategic direction and execution.

The update also noted Zip’s ongoing $50 million on-market share buyback program, with 3.9 million shares already repurchased for $6.4 million. This move underscores its focus on capital efficiency and shareholder value.

In outlining its future strategy, Zip detailed several initiatives aimed at long-term growth. These include expanding its merchant and strategic partnerships, launching new products, enhancing customer experience through automation, and optimizing its funding and operating systems for scalability. Notably, the US business continues to grow market share in what Zip describes as an "attractive market," supported by a strong, well-capitalised balance sheet.

For those tracking performance within the ASX200, Zip’s recent rebound offers a glimpse into the broader potential for tech-enabled financial services amid shifting economic conditions. The company's sharp focus on disciplined execution and cost control aligns well with trends seen in other high-performing names in the index.

While Zip has seen significant volatility in 2025—down around 40% year-to-date—its recent update may renew investor interest, particularly within the context of emerging ASX dividend stocks and capital-efficient growth strategies.

With a solid footing in the BNPL market and reaffirmed financial targets, Zip appears poised to continue its strategic push through FY25.

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.