ZIP +13.87%: 1H25 results were positive, with better ANZ performance than January’s trading update implied, improving credit quality, and continued growth in the U.S.
- Transaction volume $6.25bn, +24% yoy
- Revenue $509m, +20% yoy
- 1H25 EBITDA $35m below consensus but already pre-reported in Jan update
- Net bad debts in Jan’ 25 down to 1.6% from 1.7% in Dec’ 24
The January update created concerns around Zip’s ANZ business though this result highlights improving margins of 6.2% vs. 5.1% a year ago and momentum in sales growth. The U.S business continued to grow above market with TTV up 40.3% year on year, driven by an impressive holiday trading period and deeper customer engagement.
Management provided full-year guidance of $147m for FY25, 1.5% above consensus. The 2nd half outlook for ZIP is positive given current momentum combined with the potential for rate cuts moving forward.
MM is cautiously bullish ZIP
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