Background: Zip Co is the Aussie-founded buy now, pay later company, which launched in 2013. It was one of the pioneers of splitting purchases into instalments and it's one of the few major players still standing after the BNPL boom (and bust).

What happened: Zip is showing signs of a comeback after a few slower years. Its share price jumped as much as 24% after the company upgraded its FY26 earnings forecast. Now, it's expecting at least $260 million in cash earnings (more than what was predicted).

What else: Zip expects transaction volumes to grow more than 40% in the US, helping fuel its turnaround. After a tough few years for the sector, Zip is bouncing back... but this time, with a sharper focus on financial responsibility.

What's the key learning?

💡 Growth is great... but in this day and age, investors really care about profitable growth. Scaling alone isn't enough anymore. Growth needs to come with earnings and sustainability.  

💡 The BNPL playbook has evolved. A few years ago, BNPL companies were all about scaling fast. The goal was to sign up as many customers and merchants as possible… without worrying too much about profits. But the "grow at all costs" strategy fell apart when interest rates rose and funding got expensive.

💡 Now, strong fundamentals are back in focus. Investors are rewarding companies that can grow usage, control bad debts, and maintain margins... Zip Co has been doing all three - and investors are clearly noticing.