Zip Co jumps on record quarterly revenue

Zip Co shares have jumped after the buy-now-pay-later platform shook off lower transaction volumes to post record quarterly revenue.

The digital payment provider and Afterpay competitor announced on Monday it had made an unaudited $23 million in revenue for the three months to March 31, a 20 per cent rise on the second quarter, and nearly double the same period last year.

Shares in Zip Co rose more than 7.5 per cent at the open before cooling to $2.60 at 1056 AEST, a rise of 4.84 per cent.

Zip, which floated on the ASX at 20 cents in 2015, said it also signed a number of well-known enterprise clients to the platform during the quarter, including Chemist Warehouse, Lorna Jane, General Pants, Decathlon, Bupa Health and Lego.

Managing director and chief executive Larry Diamond said transaction volumes fell eight per cent for the quarter but transaction numbers remained flat thanks to a 143,000, or 14 per cent, increase in customer numbers to 1.2 million.

“We are pleased to report another record quarter… in what is traditionally the weakest seasonal quarter in retail sales,” Mr Diamond said in a release to the ASX.

Transaction volumes were eight per cent lower for the quarter but had more than doubled year-on-year at $281.4 million.

Zip said it was the fifth consecutive quarter of positive operating cashflow and positive cash EBTDA.

Total downloads of the Zip native app across IOS and Android now tally over 740,000 since its launch in August, with monthly active users up significantly over the quarter.

AAP

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