Key Takeaways
Powered by lumidawealth.com
- Australian buy-now-pay-later firm Zip is exploring a secondary listing in the U.S. following strong annual profit growth.
- U.S. institutional investors, including State Street, Vanguard, Merrill Lynch, and BlackRock, currently own 16% of Zip’s Australia-listed shares and are seeking greater exposure.
- U.S. revenue now accounts for over 80% of Zip’s total, with a 44% increase to $424.8 million in the past year.
- The value of U.S. transactions on Zip’s platform rose 42%, driven by sectors like groceries, education, and health.
- Zip’s annual profit jumped to AUD 79.9 million (~$51.3 million) from AUD 3.7 million a year earlier.
- The company forecasts improved margins and at least 35% growth in U.S. transaction value in the coming fiscal year.
- Zip estimates its total addressable U.S. market at 100 million consumers, with 4.3 million active U.S. users, up 11% year-over-year.
What’s Happening?
Zip is responding to growing demand from U.S. institutional investors by considering a secondary listing on a U.S. exchange. This move aims to facilitate easier investment access for these shareholders and capitalize on Zip’s rapid growth in the U.S. market, where it has become a key player in consumer cash-flow management through buy-now-pay-later services.
Why Does It Matter?
The secondary listing would increase Zip’s visibility and liquidity among U.S. investors, potentially boosting its valuation and capital-raising ability. It also reflects the growing importance of the U.S. market for Zip, which now generates the majority of its revenue. The company’s strong performance amid economic uncertainty highlights the resilience and appeal of buy-now-pay-later services as consumers seek flexible payment options.
What’s Next?
Zip will continue expanding its U.S. user base and transaction volume, focusing on non-discretionary spending categories. The company’s progress with the secondary listing will be closely watched by investors, as it could unlock new growth opportunities and enhance shareholder value. Monitoring Zip’s margin improvements and market penetration will be key indicators of its future trajectory.
