The Zip Co Ltd (ASX: ZIP) share price is tumbling today.
Shares in the S&P/ASX 200 Index (ASX: XJO) buy now, pay later (BNPL) stock closed yesterday trading for $2.27. In morning trade on Monday, shares are changing hands for $2.06 apiece, down 9.3%.
For some context, the ASX 200 is up 0.3% at this same time.
This underperformance comes following the release of Zip's full-year financial results for the 12 months ending 30 June (FY 2024).
Read on for the highlights.
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Zip share price tumbles despite revenue boost
- Revenue of $868 million, up 28.2% from FY 2023
- Cash earnings before tax, depreciation and amortisation (EBTDA) of $69 million, up 243.2% year on year
- Total transaction volume (TTV) of $10.1 billion, up 14.0% from FY 2023
- Cash gross profit of $373 million, up 52.8% from last year
What else happened with the ASX 200 BNPL stock in FY 2024?
ASX 200 investors clearly had high expectations of Zip's results today.
Investors are bidding down the Zip share price, with the ASX 200 BNPL stock reporting a 9.6% year on year increase in merchant numbers to 79,300. Active customer numbers went the other way, though, sliding 2.9% over the 12 months to 6.0 million.
In other core financial metrics, Zip achieved a revenue margin of 8.7%, up 0.96% from FY 2023. This came as net bad debts declined by 0.18% to stand at 1.7% of TTV.
The company reported a cash net transaction margin of 3.8%, also up 0.96% from last year.
On a regional level, Zip Americas delivered record cash EBTDA of $77.2 million. And Zip Australia and New Zealand delivered a record cash EBTDA of $33.0 million.
As for the balance sheet, all Zip convertible notes were converted or extinguished. In July 2024, Zip executed an institutional equity placement to repay its $130 million outstanding corporate debt facility.
As at 30 June, the ASX 200 BNPL company had available cash of $80.4 million.
What did management say?
Commenting on the results that have failed to lift the Zip share price today, CEO Cynthia Scott said the company was "executing against all of its strategic priorities and reinforcing its position as a strong, simplified and profitable business".
Scott said, "The team successfully delivered four quarters of profitability, achieving Cash EBTDA of $69.0 million for the year, an improvement of $117.0 million on FY 2023."
Scott added:
During the year, Zip launched a new product in Australia, Zip Plus and piloted a new 'Pay-in-8' product in the US, reinforcing Zip's commitment to innovating and creating great products and experiences for customers and merchants.
What's next for Zip?
Looking at what could impact the Zip share price in the year ahead, Scott said:
We maintain a clear strategy with identified growth opportunities in both markets to drive continued profitable growth in FY 2025 and beyond and deliver long-term value for our customers, merchants and stakeholders.
Zip share price snapshot
With today's intraday fall factored in, the Zip share price remains up an eye-watering 527% over 12 months. Which goes a long way to explaining why investors expect a lot of growth from this ASX 200 BNPL stock and may be taking some profits today.
