Skip to content

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Zip earnings preview: is the BNPL leader on track to profit?

As Zip prepares to announce its annual report, what should traders expect?

Source: Bloomberg

Zip Co Limited (ASX: ZIP) release date:

Zip Company Limited will release its annual report on Thursday, 25 August 2022.

Zip Co Limited earnings expectation

Zip reported a 27% increase in quarterly revenue ending in June 2022, an increase of $160.1 million when compared to Q4 in 2021. For the full-year, Zip's revenue increased by a healthy 54% to $621.5 million and even then, the company fell short of expectation.

ZIP FY22 Earnings Key Watch

The robust results for the past financial year can be primarily attributed to its consumer sector including the United States, Australia, and New Zealand.

  • Customer Growth

Based on the past four quarterly reports, Zip’s underlying business remains strong with consistent customer and transaction growth across its core markets and a solid pipeline of enterprise merchants joining the platform. As shown in the below chart, the US market remains a core market for the group, representing a significant opportunity for expansion.

Source: ZIP
  • Path to profitability

This year, Zip has announced a new commitment to focus on a new strategic plan and accelerate its path to profitability. Based on the revised plan, the global financial technology provider is taking steps to reshape its international presence by closing down its Singapore business.

Management recently revealed that the company will give up Zip Business and the Pocketbook app, as well as proposed crypto and investment products. As a result, Zip has reaffirmed its target to deliver group profitability during FY24.

  • Merger termination

In light of current macroeconomic and market conditions, Zip and Sezzle have mutually agreed to terminate their merger agreement and the proposed acquisition of Sezzle by Zip in July. As part of the termination, Zip needs to pay Sezzle $11 million to cover legal, accounting, and other costs associated with the transaction.

ZIP share price and technical analysis

After rising more than 286% in July, Zip's stock price has pulled back below $1 with support from the previous high at 0.981. The next key watch level will be the 100-day Simple Moving Average and 38.2% Fibonacci extension level if the price keeps sliding. On the other hand, in a scenario in which the coming report helps to recover the risk sentiment, the imminent price target is set to be around $1.052, where a critical 50% Fibonacci extension stands in place.

Source: IG

This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Monday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.