Shares of buy-now-pay-later lender Zip Co surged 9.5% to A$2.66 after the company's daily ASX filings revealed it is still aggressively hoovering up its own stock, fuelling a rally that has added roughly 11% in just four trading sessions. The move comes as Zip races through a $50 million on-market buyback — its second major repurchase program in less than a year — while investors position ahead of full-year results due August 20.
• The Buyback Is Nearly Spent, Raising Questions About What Comes Next
As of June 10, Zip had cumulatively repurchased 17.37 million shares, with an additional 636,890 bought the prior day. That pushes the program close to its 18.82 million-share ceiling. The buyback, capped at $50 million, launched around March 6 and can run for up to 12 months.
It follows a prior $100 million buyback completed in December 2025; by late March, Zip had already spent $21 million repurchasing 13.8 million shares under the new program. Once this program is exhausted, the stock loses a steady buyer — and investors must decide whether the underlying business alone can sustain the rally.
• Record Earnings Growth Muddied by a Guidance Scare Still Haunting Shares
Zip delivered record quarterly cash earnings of $65.1 million for the March 2026 quarter, up 41.5% year-on-year, and raised full-year guidance.
Management now expects group cash EBTDA of at least $260 million for FY26. Yet the stock still trades well below its 52-week high of A$4.93 — a hangover from the February earnings release, when shares plunged nearly 33% in a single day after investors fixated on flat second-half guidance rather than the strong headline numbers.
• US Growth Is the Real Story, But It Must Keep Accelerating
Total transaction volume hit $4 billion in Q3, up 22.4%, with US volumes alone surging 43.1% to US$2.12 billion.
Zip now serves 6.5 million active customers across 93,900 merchants. That US expansion is the company's primary profit engine — but Australian active customers declined 7.4% year-on-year , meaning US momentum must more than compensate.
• A Smaller Share Count Only Helps If Profits Follow
With roughly 1.25 billion shares outstanding and a market cap near A$3 billion , the cumulative buybacks are trimming the denominator in Zip's earnings-per-share equation — meaning each remaining share gets a slightly bigger slice of profits. But at current prices, the stock trades at about 21× normalized earnings. Investors betting on the buyback bounce need August's results to prove the profit trajectory is real.