The Zip Co Ltd (ASX: ZIP) share price has jumped 4% after the company announcing a share buyback.
Zip is one of the largest buy now, pay later operators in Australia and the US. The company recently announced it was exiting New Zealand.
On market purchase of Zip shares
The company announced today that on 11 September 2026, it completed the on-market purchase of 9.7 million shares to minimise dilution of the equity incentive plan (EIP) allocations.
Zip said that this activity is in line with Zip’s capital management framework and the company’s objective to “enhance long-term shareholder value”.
The Zip shares that were purchased at an average price of $2.44 for a total price of $23.7 million. Those bought shares will be placed into the employee share trust until the time of allocation, in accordance with the terms under the equity incentive plan.
Start of previously announced share buyback
The ASX share said that in line with its announcement on 20 August 2026, it started that on-market share buyback of up to $50 million on 14 September 2026.
The timing and number of shares purchased under the buy back program will depend on several factors, including market conditions.
Outlook for the Zip share price
Zip has been one of the most volatile shares over the past five years. Despite rising 36% in the past six months, it’s still down 51% over the past year and it has dropped 68% in the last five years.
If Zip is to recapture positive investor attention, then it will need to continue delivering a pleasing performance in the US.
FY26 saw excellent progress in the United States, with 9.3% active customer growth to 4.65 million, 24.6% growth of US merchants to 30,800.
Those above numbers helped US total transaction value (TTV) grow 35.6% to A$12.67 billion and US revenue soared 37.3% to A$903.1 million. In US dollar terms, US revenue increased 44% to US$613.1 million and US TTV increased 42.5% to US$8.6 billion.
Overall cash EBTDA (EBITDA explained) improved 57.9% to $268.9 million, so the company’s financials are rapidly improving. Statutory net profit increased 45.7% to $116.4 million.
If the company can continue growing its US TTV, then I think its outlook is more positive than the market is giving it credit for.
