Zip's record quarter reveals how tightening credit markets favor buy now, pay later lenders

Buy now, pay later lender Zip posted record cash earnings of $65.1 million in the March quarter, a 42% jump from the same period last year, as tightening credit conditions drive more consumers toward installment financing. Total transaction volume reached $4 billion, up 22%, while total income climbed 20% to $335.2 million. Revenue margins dipped to 8.4% from 8.6%, but the company maintained its net bad debt rate at 1.9%—within management’s target range. Active customers grew to 6.5 million, a 3.5% increase. Retailers told ChannelNews they are seeing more credit purchases, a trend that coincides with Zip’s rising transaction volume. The company raised its FY26 group cash EBITDA forecast to $260 million, up from $249 million. Zip CEO Cynthia Scott attributed the gains to deepened customer engagement and disciplined execution across its Australian and U.S. markets. Retailers report increased credit purchases amid tightening market conditions.