Buy-now pay-later (BNPL) platform Zip Co (ASX: Z1P) has capped off its strongest quarter to date in Q2 FY20, with record transaction volumes and an influx of new customers.
The listed fintech recorded transaction volumes of more than $200 million in a single month for the first time during the December quarter.
Zip was certainly given a boost by the numerous sales periods during the December quarter like Black Friday, Cyber Monday and Boxing Day, as well as pre-Christmas spending.
In total, the company brought in $36.1 million in revenue during 2Q20, representing a 17 per cent increase on 1Q20 and an 88 per cent increase on 2Q19.
The total transaction volume during the quarter also hit a new high of $562.6 million, up 40 per cent on Q1 and 85 per cent year on year.
Zip added 172,542 customers during the quarter and 1,841 merchants, including household name brands like Ola, Optus, Seafolly, Jax Tyers and Sigma.
“Ola represents the Company’s first foray into ridesharing, as Zip continues to execute on its strategy of adding everyday spend to the Zip digital wallet extending beyond retail as a true credit card disruptor,” says Zip.
Notably during the period, the company became the first instalment payment option for Amazon Australia.
In connection with the agreement Zip issued to an Amazon affiliate warrants to acquire up to 14.6 million ordinary shares in Zip at $4.70 per share, valuing the deal at approximately $69 million.
In October 2019 Zip acquired PartPay which it has since been renamed to Zip NZ and has been integrated into the broader Zip business.
Zip NZ generated $0.6 million on transaction volume of $18.7 million from 117,000 transactions in the two months since acquisition.
NZ customer numbers increased to over 165,000 and merchant numbers grew to 1,100, with major brands The Warehouse Group, TheMarket, Spark, Rockshop, Saben and Lighting Plus joining the platform.
The group expects its UK business to take off in 2020 following the appointment of Anthony Drury to the position of managing director of Zip UK in late December.
There is a team of 10 on the ground in the UK, with a number of key hires to start this coming quarter.
Looking forward the group is now annualising at transaction volumes of $2.3 billion for Q2, against a target for EOFY 2020 of $2.2 billion.
The company aims to have a global customer base of 2.5 million by the end of the 2020 financial year.
Shares in Zip are up 4.82 per cent to $3.70 per share at 11.29am AEDT.
Business News Australia