Zip Co Ltd (ASX:Z1P), the Australian buy-now-pay-later provider, will close its UK operations after incurring a A$1.015bn (£0.6bn) annual loss.
The British exit comes just a year after launching in the country.
Its decision to exit the UK comes a month after it decided to terminate acquisition plans for Sezzle Inc, a BNPL competitor.
As part of its strategy to build scale for attracting the largest retail merchants, Zip announced the A$491mln all-scrip acquisition in January, but investors subsequently switched from growth stocks to defensive plays, decimating BNPL valuations.
Compared to the restated A$697.4mln loss in fiscal 2021, net loss for 12 months through June widened, with the company recording a non-cash impairment of A$821.1mln related to goodwill and intangible assets.
The company said it would leave the UK after simplifying its product range and exiting Singapore, with the aim of reducing its cash burn by focusing on the US, Australia and New Zealand.
The UK financial watchdog recently warned firms offering BNPL products about using misleading advertising, including social media posts, and that they must comply with financial promotion rules.
"It’s clear the world is vastly different than when we started the year," said chief executive Larry Diamond, reports Bloomberg.
Last month, Klarna, the BBNPL unicorn, had to accept a steep drop in its valuation in order to get a US$800mln funding round over the line.
In September 2020, Zip acquired US-based BNPL company Quadpay to grow its American footprint.
As a result of rising rates, soaring inflation, worsening consumer sentiment, and global macro uncertainty, Zip said it stopped expanding in the US and elsewhere.