Zip Co Ltd (ASX: ZIP) shares remain well below their February 2021 all-time highs.
But shares in the S&P/ASX 200 Index (ASX: XJO) buy now, pay later (BNPL) stock sure have come a long way since October 2023.
At the time of writing, Zip stock looks to be caught up in the broader market retrace.
Zip shares closed yesterday trading for $4.19 and are currently changing hands for $4.07 apiece, down 3.0%. For some context, the ASX 200 is down 0.9% at this same time.
Despite today's underperformance, you'll be hard-pressed to find investors who bought Zip stock three years ago complaining about their returns.
Just what kind of returns are we talking about?
I'm glad you asked!
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Your $10,000 investment in Zip shares
Three years ago, on 21 October 2022, you could have picked up Zip shares near market close for 62 cents apiece.
Meaning for $10,000, you could have snapped up 16,129 shares.
Trading for $4.07 apiece today, those same shares would now be worth $65,645. That's a gain of 556.5% in only three years.
Boom!
What's the latest from the ASX 200 BNPL stock?
Zip reported its first-quarter (Q1 FY 2026) results on Monday.
And Zip shares closed the day up 4.3% after the company reported a 98.1% year-on-year increase in cash earnings before tax, depreciation and amortisation (EBTDA) of $62.8 million.
That was spurred by a 38.7% boost in total transaction volume (TTV), which came in at $3.9 billion for the quarter. The company reported total income of $321.5 million, up 32.8% from Q1 FY 2025.
Investor interest was also piqued after management doubled the company's on-market share buyback from $50 million to $100 million.
That's supported by Zip's solid balance sheet, with the company holding $451.5 million in cash as at 30 September.
Looking ahead, Zip upgraded its full-year FY 2026 guidance for US TTV growth to above 40% (in US dollar terms). Zip's US segment reported 47.2% TTV growth in the first quarter of FY 2026.
"Zip continues to deliver sustainable, profitable growth at scale, with record cash earnings of $62.8 million up 98.1% year on year," CEO Cynthia Scott said of the results that sent Zip shares soaring on the day.
Scott added:
This was underpinned by strong unit economics, material operating leverage and disciplined execution, driving a significant increase in operating margin to 19.5%. We are committed to delivering exceptional experiences for our customers, with engagement deepening across both markets.
