The Zip Co Ltd (ASX: ZIP) share price is rallying after a steep early morning slide amid a tough day for buy now, pay later (BNPL) shares.
The Zip share price fell as low as 9.65% in early trading but has made its way back into the green, up 2.27% to 90 cents at the time of writing. For perspective, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.04%.
Let's take a look at what is happening to the Zip share price.
What's happening to the Zip share price?
The Zip share price struggled early but it was not the only BNPL share in the red. Block Inc (ASX: SQ2) shares are down 3.86% while the Sezzle Inc (ASX: SZL) share price is 10% lower at the time of writing.
Today's fall follows the S&P 500 Index sliding 0.93% and the NASDAQ dropping 1.87% in US markets on Friday.
Investors were alarmed after Snap Inc (NYSE: SNAP) reported a net loss of $422 million compared to its $152 million loss in the previous quarter. Snapchat shares fell 39% on the back of the results.
BNPL share Block's New York Stock Exchange listing was among other shares in the red, down nearly 4%. Commenting on the market falls, Crossmark Global Investments chief investment officer Bob Doll said, cited by Reuters:
Earnings are coming in less bad than feared, but they're deteriorating from what we got used to and accustomed to over the last several quarters
Meantime, Zip reported a 27% increase in revenue to $160 million last week compared to the prior corresponding period. Customer numbers also grew 5.3% from the previous quarter to 12 million.
ZIP CEO and co-founder Larry Diamond said:
All this was done whilst balancing and implementing our updated financial strategy to fast-track profitability, by reducing our global cost base, and refocusing our capital and efforts on core products and core markets.
Share price snapshot
Zip shares have slid 87% in the past year, losing 79% in the year to date.
However, in the past month, Zip shares have surged 68%.
For perspective, the benchmark ASX index has declined about 8% in the past year.
Zip has a market capitalisation of about $619 million based on today's share price.
