The Zip Co Ltd (ASX: Z1P) share price has been a very strong performer on Tuesday.
In morning trade, the buy now pay later (BNPL) provider's shares are up
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Why is the Zip share price rocketing higher?
The catalyst for the rise in the Zip share price today has been the release of an update on its performance in November.
As you might have guessed from the Zip share price performance, the company's strong growth continued last month.
According to the release, Zip delivered record monthly transaction volume of $906.5 million during November. This represents an increase of 52% or $310.5 million over the prior corresponding period.
Based on November's performance, the company's transaction volume is now annualising at over $10 billion.
What were the drivers of this growth?
The release explains that this result was driven by an 86% lift in transaction numbers to a record of 7.5 million and a 71% jump in customer numbers to 9.2 million.
In respect to its customer numbers, this comprises 5.5 million is the USA (up 92%), 2.9 million in the ANZ region (up 27%), 0.2 million in the UK (up 564%), and 0.6 million in Expansion markets. The latter will soon include the Singapore market, where Zip has signed an exclusive agreement with Singtel to support its launch and leverage the Singtel Dash App.
Zip's Managing Director and Global CEO, Larry Diamond, commented: "November was a very strong month for the Company, and shows the tremendous growth achieved since this time last year with many markets processing BNPL payments for the first time – the Company is now processing annualised volume of more than $10b. Zip now has one of the largest BNPL footprints geographically with the aim of servicing its global merchants and partners in a simple and easy format."
Zip share price underperformance
Mr Diamond also addressed the underperformance of the Zip share price this year. As I highlighted here, the company's shares were down 22% year to date to a 52-week low on Monday.
The CEO commented: "Management and the Board would also like to acknowledge the significant volatility in equity markets, the impact to technology and fintech valuations and is taking this very seriously. We enter CY 2022 with strong momentum, in a solid financial position, with continued focus on execution, unit economics and global synergies."
"We have bolstered the global executive team to better handle both regional and functional execution, and remain driven as ever to achieve the best long term outcomes for our customers, merchants and shareholders. A significant portion of the management team and the employees' assets and remuneration is tied to the share price, and feels these gyrations alongside our loyal investor base," he added.
