Let's do a little analysis here
From this annual report
From the November update
YoY numbers are impressive, yet slightly below the % gain of the previous year. Does this mean growth is slowing? You could be mistaken for thinking so.
From Nov 2020 update.
Key points for me are:
$264.2m in Nov 2020 compared to $403.2m this year for US data. 35% growth
Total annualising $7b Nov 2020 vs $10b this year, global figure. 30% growth
Customers 5.3m to 9.2m YoY. 58% growth
UK revenue and Zip Business revenue is significant in terms of the UK kicking off properly, and the service essentially at break even. Given Zip Business is in it's early days this is a very good sign.
I would ask the shorters specifically, does this look like slowing growth to you? If so, please show me your numbers to prove your point.
To the holders, my opinion is that macro economics is king. All the data I have seen is pointing to Z1P being a significant global player. This is a long term hold for me. Short term losses will be regained relatively quickly at these levels.
As for people saying all BNPL is in a loss making position I would say let's look at the numbers for that.
Losses were $724m for the 2021, and only $20m for 2020. Why did it go up so much?
Quadpay acquisition $306.2m, QuadPay brand write off $42m, increased business costs $9.9m. Ok so that's 358m accounted for which would not happen in a regular year. Remaining losses are $366m which include Cost Of Sales increasing. "1. Cost of sales includes interest expense, amortisation of funding costs, bad debts and expected credit losses, and bank fees and data costs". Keep your eyes on this one, could be something to be concerned about. It will be the first number I look at in the HY.
Given the above, it would be easy to say that Z1P is in a deep loss making position. It is. But that is due to it's rapid expansion and acquisition strategy, it's growth, and an ill-timed and unwarranted rebrand (my opinion only). The November update tells us that it's actually ok to be spending that, because they are growing at roughly 50% YoY at this point, or in $ terms, Z1P be bringing in almost $13b in transaction volume by the FY22, and revenue can be expected to be approximately $850-$900m.
Interesting times to be in the investor seat. Hold on. It
will be rough(this means good and bad times). There are good and bad aspects about Z1P and their team, just like any company. I think the good will outweigh the bad. What do you think?
I could easily be wrong or biased. DYOR and share it.
(20min delay)