The Zip Co Ltd (ASX: ZIP) share price is rallying after a steep early morning slide amid a tough day for buy now, pay later (BNPL) shares.
The Zip share price fell as low as 9.65% in early trading but has made its way back into the green, up 2.27% to 90 cents at the time of writing. For perspective, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.04%.
Let's take a look at what is happening to the Zip share price.
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What's happening to the Zip share price?
The Zip share price struggled early but it was not the only BNPL share in the red. Block Inc (ASX: SQ2) shares are down 3.86% while the Sezzle Inc (ASX: SZL) share price is 10% lower at the time of writing.
Today's fall follows the S&P 500 Index sliding 0.93% and the NASDAQ dropping 1.87% in US markets on Friday.
Investors were alarmed after Snap Inc (NYSE: SNAP) reported a net loss of $422 million compared to its $152 million loss in the previous quarter. Snapchat shares fell 39% on the back of the results.
BNPL share Block's New York Stock Exchange listing was among other shares in the red, down nearly 4%. Commenting on the market falls, Crossmark Global Investments chief investment officer Bob Doll said, cited by Reuters:
Earnings are coming in less bad than feared, but they're deteriorating from what we got used to and accustomed to over the last several quarters
Meantime, Zip reported a 27% increase in revenue to $160 million last week compared to the prior corresponding period. Customer numbers also grew 5.3% from the previous quarter to 12 million.
ZIP CEO and co-founder Larry Diamond said:
All this was done whilst balancing and implementing our updated financial strategy to fast-track profitability, by reducing our global cost base, and refocusing our capital and efforts on core products and core markets.
Share price snapshot
Zip shares have slid 87% in the past year, losing 79% in the year to date.
However, in the past month, Zip shares have surged 68%.
For perspective, the benchmark ASX index has declined about 8% in the past year.
Zip has a market capitalisation of about $619 million based on today's share price.
