Financial Data and Key Metrics Changes - The company is pleased to improve its outlook for the current quarter and the fiscal year, indicating a positive trend in financial performance [6][7] - The quarter showed strong growth in GMV (Gross Merchandise Volume), with March being the strongest month at 40% year-on-year growth [20] Business Line Data and Key Metrics Changes - Strong growth was observed across various business lines, particularly in direct-to-consumer services, which outpaced the overall business growth [19] - The zero APR product is gaining traction, although it has a lower revenue and return on loan compared to interest-bearing loans [10][12] Market Data and Key Metrics Changes - The company noted broad-based strength in GMV across its merchant base, with only one category experiencing a decline [19] - The company is actively engaging with merchants to promote zero APR offers, which are seen as beneficial for both parties [11][28] Company Strategy and Development Direction - The company aims to balance growth and profitability while continuing to take market share [7] - There is a focus on enhancing the Affirm app to improve user engagement and repayment rates, with ongoing updates and features being rolled out [61][63] Management's Comments on Operating Environment and Future Outlook - Management is mindful of potential economic challenges, including the impact of student loan enforcement and broader economic conditions [59] - The company is prepared for recession scenarios and has a proactive approach to adjusting credit quality and underwriting standards as needed [34][112] Other Important Information - The partnership with Costco is highlighted as a significant development, although specific timelines and metrics are not disclosed [70][71] - The company is committed to reporting loan data to credit bureaus, which is seen as beneficial for consumers and the company's brand [40][42] Q&A Session Summary Question: Can you discuss the balance of economics between zero APR and interest-bearing loans? - Management indicated that while zero APR loans generate less revenue, they enhance brand loyalty and customer acquisition, leading to better credit quality in the long term [10][12] Question: What are the pockets of strength in GMV? - The company reported strong growth across most categories, with direct-to-consumer services leading the charge [19][20] Question: How does the company view the impact of student loan enforcement? - Management is monitoring the situation closely and has already factored student loan delinquencies into their underwriting processes [59] Question: Can you elaborate on the competition and funding structure? - The competitive landscape remains intense, but the company focuses on conversion and impact rather than pricing to maintain its market position [122][123] - A bank charter is not seen as a solution for the current funding strategy, but the company remains open to pursuing one if necessary for product development [116][120]

Financial Data and Key Metrics Changes - The company is pleased to improve its outlook for the current quarter and the fiscal year, indicating a positive trend in financial performance [6] - The company is on a journey towards becoming GAAP profitable, balancing growth and profitability [6] Business Line Data and Key Metrics Changes - The strength in GMV (Gross Merchandise Volume) was broad-based, with strong growth across various categories, particularly in direct-to-consumer services, which grew faster than the overall business [18][19] - March was highlighted as the strongest month of growth, achieving a 40% year-on-year GMV growth [19] Market Data and Key Metrics Changes - The company noted that the 0% APR product is gaining excellent traction, with a focus on maintaining high credit quality [10][12] - The company is actively responding to merchant requests for promotional financing, which is seen as a growth opportunity [10][12] Company Strategy and Development Direction - The company aims to balance growth opportunities with excellent credit quality while being judicious in spending [6] - The management emphasized the importance of the 0% APR product as a tool for market share growth and customer acquisition, viewing it as a long-term value booster [12][28] Management Comments on Operating Environment and Future Outlook - Management is mindful of the potential implications of student loan enforcement and has factored this into their underwriting processes [59] - The company is continuously monitoring credit trends and is prepared to adjust its strategies based on market conditions [110][115] Other Important Information - The company is focused on enhancing its app to improve user engagement and repayment rates, with ongoing updates and improvements [61][64] - The partnership with Costco is seen as a significant opportunity, although specific timelines for impact were not disclosed [70][71] Q&A Session Summary Question: Can you discuss the balance between zero APR loans and interest-bearing loans? - Management indicated that while zero APR loans generate slightly lower revenue, they significantly improve credit quality and customer acquisition, leading to long-term benefits [10][12] Question: What are the pockets of strength in GMV? - The company reported strong growth across various categories, with direct-to-consumer services leading the charge [18][19] Question: How does the company view the competitive landscape? - Management acknowledged the competitive environment but emphasized their focus on conversion and impact rather than pricing [126][129] Question: What are the implications of student loan enforcement? - The company is monitoring the situation closely and has already incorporated student loan data into their underwriting processes [59] Question: Can you provide an update on international expansion? - The partnership with Adyen is expected to speed up integration in the UK, with ongoing efforts to educate the market about the company's offerings [91][92] Question: How is AI being utilized within the company? - The company is leveraging machine learning for credit scoring and operational efficiency, while also exploring generative AI for customer interactions [96][100]

Part I - Financial Information This section provides Affirm Holdings, Inc.'s unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents Affirm Holdings, Inc.'s unaudited condensed consolidated financial statements, including balance sheets, statements of operations, stockholders' equity, and cash flows, with detailed notes on accounting policies, revenue, loans, debt, and equity for the periods ended March 31, 2025 and June 30, 2024 [Condensed Consolidated Balance Sheets (Unaudited)](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS%20(Unaudited)) This section presents the company's unaudited condensed consolidated balance sheets as of March 31, 2025, and June 30, 2024, detailing assets, liabilities, and stockholders' equity Balance Sheet Highlights (in thousands) | Metric | March 31, 2025 (in thousands) | June 30, 2024 (in thousands) | | :-------------------------------- | :---------------------------- | :--------------------------- | | Cash and cash equivalents | $1,351,148 | $1,013,106 | | Loans held for investment, net | $6,255,459 | $5,360,959 | | Total assets | $10,436,187 | $9,519,619 | | Convertible senior notes, net | $1,152,019 | $1,341,430 | | Notes issued by securitization trusts | $4,084,934 | $3,236,873 | | Total liabilities | $7,561,272 | $6,787,630 | | Total stockholders' equity | $2,874,916 | $2,731,989 | - Assets of consolidated Variable Interest Entities (VIEs) increased to **$6.24 billion** as of March 31, 2025, from **$5.38 billion** as of June 30, 2024, primarily driven by an increase in loans held for investment within these entities[16](index=16&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited)](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20INCOME%20(LOSS)%20(Unaudited)) This section presents the unaudited condensed consolidated statements of operations and comprehensive income (loss) for the three and nine months ended March 31, 2025 and 2024 Statements of Operations Highlights - 3 Months Ended March 31 (in thousands) | Metric | 3 Months Ended Mar 31, 2025 (in thousands) | 3 Months Ended Mar 31, 2024 (in thousands) | Change (YoY) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | :------------- | | Total revenue, net | $783,135 | $576,157 | +36% | | Operating loss | $(8,393) | $(160,789) | -95% | | Net income (loss) | $2,804 | $(133,936) | +102% | | Basic EPS | $0.01 | $(0.43) | N/A | | Diluted EPS | $0.01 | $(0.43) | N/A | Statements of Operations Highlights - 9 Months Ended March 31 (in thousands) | Metric | 9 Months Ended Mar 31, 2025 (in thousands) | 9 Months Ended Mar 31, 2024 (in thousands) | Change (YoY) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | :------------- | | Total revenue, net | $2,347,995 | $1,663,814 | +41% | | Operating loss | $(145,337) | $(542,387) | -73% | | Net income (loss) | $(17,058) | $(472,621) | -96% | | Basic EPS | $(0.05) | $(1.53) | N/A | | Diluted EPS | $(0.05) | $(1.53) | N/A | - The company achieved **net income of $2.8 million** for the three months ended March 31, 2025, a significant improvement from a net loss of **$133.9 million** in the prior-year period, primarily driven by strong revenue growth and reduced operating losses[19](index=19&type=chunk) [Condensed Consolidated Statement of Stockholders' Equity (Unaudited)](index=9&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20STOCKHOLDERS'%20EQUITY%20(Unaudited)) This section presents the unaudited condensed consolidated statement of stockholders' equity for the nine months ended March 31, 2025 - Total stockholders' equity increased from **$2.73 billion** as of June 30, 2024, to **$2.87 billion** as of March 31, 2025, primarily due to stock-based compensation, vesting of warrants, and net income in the latest quarter, partially offset by common stock repurchases[21](index=21&type=chunk)[24](index=24&type=chunk) Stockholders' Equity Changes - 9 Months Ended March 31, 2025 (in thousands) | Item | 9 Months Ended March 31, 2025 (in thousands) | | :------------------------------------ | :------------------------------------------- | | Balance as of June 30, 2024 | $2,731,989 | | Stock-based compensation | $394,493 | | Vesting of warrants for common stock | $230,102 | | Repurchases of common stock | $(250,000) | | Net income (loss) | $(17,058) | | Balance as of March 31, 2025 | $2,874,916 | [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=11&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20(Unaudited)) This section presents the unaudited condensed consolidated statements of cash flows for the nine months ended March 31, 2025 and 2024 Cash Flow Activities - 9 Months Ended March 31 (in thousands) | Cash Flow Activity | 9 Months Ended Mar 31, 2025 (in thousands) | 9 Months Ended Mar 31, 2024 (in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | | Net cash provided by operating activities | $719,272 | $381,375 | | Net cash used in investing activities | $(628,550) | $(787,516) | | Net cash provided by financing activities | $364,166 | $767,180 | | Net increase in cash, cash equivalents and restricted cash | $440,560 | $359,747 | | Cash, cash equivalents and restricted cash, end of period | $1,735,959 | $1,619,691 | - Net cash provided by operating activities significantly increased to **$719.3 million** for the nine months ended March 31, 2025, from **$381.4 million** in the prior-year period, driven by improved net loss and non-cash adjustments[26](index=26&type=chunk)[288](index=288&type=chunk)[290](index=290&type=chunk) - Cash payments for interest expense increased to **$302.8 million** for the nine months ended March 31, 2025, from **$228.5 million** in the prior-year period[28](index=28&type=chunk) [1. Business Description](index=13&type=section&id=1.%20Business%20Description) This section describes Affirm Holdings, Inc.'s business model, focusing on its transparent payment solutions and proprietary risk underwriting platform - Affirm Holdings, Inc. provides consumers with a simpler, more transparent, and flexible alternative to traditional payment options, enabling them to pay for purchases over time with no hidden fees, deferred interest, or penalties[30](index=30&type=chunk)[31](index=31&type=chunk) - The company's next-generation commerce platform utilizes a proprietary risk model for underwriting loans, which are directly originated or funded and issued by its originating bank partners[30](index=30&type=chunk) [2. Summary of Significant Accounting Policies](index=13&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This section outlines the significant accounting policies used in preparing the interim condensed consolidated financial statements, including consolidation and recent accounting pronouncements - The interim condensed consolidated financial statements are prepared in accordance with U.S. GAAP and consolidate all wholly-owned subsidiaries and Variable Interest Entities (VIEs) where Affirm has a controlling financial interest[32](index=32&type=chunk)[33](index=33&type=chunk) - There were no material changes to Affirm's significant accounting policies as disclosed in its Annual Report on Form 10-K for the fiscal year ended June 30, 2024[38](index=38&type=chunk) - Affirm is currently evaluating the impact of recently issued ASUs on Segment Reporting (ASU 2023-07), Income Taxes (ASU 2023-09), Reporting Comprehensive Income (ASU 2024-03), and Debt with Conversion and Other Options (ASU 2024-04)[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) [3. Revenue](index=15&type=section&id=3.%20Revenue) This section details the components of Affirm's net revenue, including merchant network revenue, card network revenue, interest income, gain on sales of loans, and servicing income Revenue by Source - 3 Months Ended March 31 (in thousands) | Revenue Source | 3 Months Ended Mar 31, 2025 (in thousands) | 3 Months Ended Mar 31, 2024 (in thousands) | Change (YoY) | | :---------------------- | :--------------------------------------- | :--------------------------------------- | :------------- | | Merchant network revenue | $213,973 | $159,292 | +34% | | Card network revenue | $58,572 | $35,676 | +64% | | Interest income | $402,701 | $315,712 | +28% | | Gain on sales of loans | $75,838 | $40,183 | +89% | | Servicing income | $32,050 | $25,294 | +27% | | **Total revenue, net** | **$783,135** | **$576,157** | **+36%** | Revenue by Source - 9 Months Ended March 31 (in thousands) | Revenue Source | 9 Months Ended Mar 31, 2025 (in thousands) | 9 Months Ended Mar 31, 2024 (in thousands) | Change (YoY) | | :---------------------- | :--------------------------------------- | :--------------------------------------- | :------------- | | Merchant network revenue | $643,207 | $493,599 | +30% | | Card network revenue | $164,194 | $108,421 | +51% | | Interest income | $1,189,132 | $866,737 | +37% | | Gain on sales of loans | $264,739 | $127,170 | +108% | | Servicing income | $86,723 | $67,887 | +28% | | **Total revenue, net** | **$2,347,995** | **$1,663,814** | **+41%** | - Merchant network revenue primarily consists of merchant fees, recognized at the point of transaction confirmation, which vary based on gross merchandise volume (GMV) and product offering terms, with incentives recorded as a reduction to revenue[44](index=44&type=chunk)[46](index=46&type=chunk) [4. Loans Held for Investment and Allowance for Credit Losses](index=18&type=section&id=4.%20Loans%20Held%20for%20Investment%20and%20Allowance%20for%20Credit%20Losses) This section provides details on loans held for investment and the allowance for credit losses, reflecting the company's loan portfolio and credit risk management Loans Held for Investment Components (in thousands) | Component | March 31, 2025 (in thousands) | June 30, 2024 (in thousands) | | :-------------------------------------------- | :---------------------------- | :--------------------------- | | Unpaid principal balance | $6,656,169 | $5,697,965 | | Accrued interest receivable | $68,997 | $62,796 | | Premiums on loans held for investment | $9,897 | $7,822 | | Less: Discount due to loss on loan purchase commitment | $(77,000) | $(63,682) | | Less: Discount due to loss on directly originated loans | $(27,612) | $(34,829) | | Less: Fair value adjustment on loans acquired through business combination | $(5) | $(16) | | **Total loans held for investment** | **$6,630,446** | **$5,670,056** | - The allowance for credit losses increased to **$375.0 million** as of March 31, 2025, from **$309.1 million** as of June 30, 2024, reflecting management's estimate of expected lifetime credit losses[67](index=67&type=chunk) Allowance for Credit Losses Activity - 9 Months Ended March 31 (in thousands) | Activity | 9 Months Ended Mar 31, 2025 (in thousands) | 9 Months Ended Mar 31, 2024 (in thousands) | | :-------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Balance at beginning of period | $309,097 | $204,531 | | Provision for loan losses | $445,313 | $325,914 | | Charge-offs | $(409,152) | $(261,657) | | Recoveries of charged-off receivables | $32,695 | $20,406 | | Balance at end of period | $374,987 | $289,088 | [5. Balance Sheet Components](index=22&type=section&id=5.%20Balance%20Sheet%20Components) This section details key balance sheet components, including property, equipment and software, goodwill, intangible assets, and commercial agreement assets Property, Equipment and Software, Net (in thousands) | Component | March 31, 2025 (in thousands) | June 30, 2024 (in thousands) | | :---------------------------------------- | :---------------------------- | :--------------------------- | | Internally developed software | $898,459 | $630,129 | | Total property, equipment and software, at cost | $939,648 | $669,892 | | Less: Accumulated depreciation and amortization | $(396,321) | $(242,206) | | **Total property, equipment and software, net** | **$543,327** | **$427,686** | - Goodwill decreased slightly to **$522.3 million** as of March 31, 2025, due to foreign currency translation adjustments, while intangible assets, primarily indefinite-lived trademarks and licenses, totaled **$12.4 million**[78](index=78&type=chunk)[79](index=79&type=chunk) - Commercial agreement assets, related to warrants granted to Amazon and Shopify, decreased due to ongoing amortization, with the Shopify agreement's expected benefit period extended from six to nine years in fiscal year 2025[81](index=81&type=chunk)[82](index=82&type=chunk) [6. Leases](index=25&type=section&id=6.%20Leases) This section describes Affirm's operating lease arrangements for facilities, including lease terms, discount rates, and related expenses and income - Affirm leases facilities under operating leases with various expiration dates through 2032, with a **weighted average remaining lease term of 4.2 years** and a **weighted average discount rate of 5.6%** as of March 31, 2025[85](index=85&type=chunk)[89](index=89&type=chunk) Operating Lease Expenses and Sublease Income (in thousands) | Metric | 3 Months Ended Mar 31, 2025 (in thousands) | 3 Months Ended Mar 31, 2024 (in thousands) | 9 Months Ended Mar 31, 2025 (in thousands) | 9 Months Ended Mar 31, 2024 (in thousands) | | :---------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Operating lease expense | $2,915 | $2,894 | $8,633 | $8,826 | | Sublease income | $900 | $1,300 | $3,400 | $3,300 | [7. Commitments and Contingencies](index=26&type=section&id=7.%20Commitments%20and%20Contingencies) This section outlines Affirm's loan repurchase obligations and involvement in various legal proceedings, assessing their potential financial impact - Affirm has a loan repurchase obligation of **$8.3 million** as of March 31, 2025, for loans held by third-party investors or unconsolidated VIEs, which may be triggered by breaches in representations and warranties[90](index=90&type=chunk) - The company is involved in several legal proceedings, including class action and shareholder derivative lawsuits (Kusnier, Quiroga, Jeffries, Vallieres actions), primarily alleging false statements and breaches of fiduciary duty[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) - Management has determined that the aggregate estimable losses from legal proceedings would not have a material adverse effect on Affirm's consolidated financial position, results of operations, or cash flows[96](index=96&type=chunk)[97](index=97&type=chunk) [8. Debt](index=28&type=section&id=8.%20Debt) This section details Affirm's debt structure, including warehouse facilities, securitization notes, and convertible senior notes, along with compliance with debt covenants Debt Outstanding by Type as of March 31, 2025 (in thousands) | Debt Type | March 31, 2025 Debt Outstanding (in thousands) | | :------------------------------ | :------------------------------------------- | | US warehouse facilities | $1,467,383 | | International warehouse facilities | $364,062 | | Variable funding notes | $51,131 | | Sales and repurchase agreements | $44,218 | | Notes issued by securitization trusts | $4,100,000 | | Convertible senior notes (2026 & 2029) | $1,168,704 | | **Total Debt Outstanding** | **$7,195,499** | - Affirm issued approximately **$920 million** in 0.75% convertible senior notes due 2029 in December 2024 and repurchased **$1.1 billion** aggregate principal amount of 2026 Notes for **$1.0 billion** cash, resulting in an **$82.4 million gain** on early extinguishment of debt[108](index=108&type=chunk)[119](index=119&type=chunk) - The company was in compliance with all applicable covenants in its funding debt agreements and revolving credit facility as of March 31, 2025[104](index=104&type=chunk)[123](index=123&type=chunk) [9. Securitization and Variable Interest Entities](index=33&type=section&id=9.%20Securitization%20and%20Variable%20Interest%20Entities) This section explains Affirm's consolidation of Variable Interest Entities (VIEs) and its exposure to losses from unconsolidated VIEs and securitization activities - Affirm consolidates Variable Interest Entities (VIEs), including warehouse credit facilities and securitization trusts, where it is deemed the primary beneficiary due to its power to direct activities and significant economic exposure[125](index=125&type=chunk)[127](index=127&type=chunk) Consolidated VIEs Assets and Liabilities as of March 31, 2025 (in thousands) | Consolidated VIEs | March 31, 2025 Assets (in thousands) | March 31, 2025 Liabilities (in thousands) | March 31, 2025 Net Assets (in thousands) | | :-------------------------- | :----------------------------------- | :---------------------------------------- | :--------------------------------------- | | Warehouse credit facilities | $2,044,461 | $1,831,884 | $212,577 | | Securitizations | $4,196,423 | $4,146,394 | $50,029 | | **Total consolidated VIEs** | **$6,240,884** | **$5,978,278** | **$262,606** | - For unconsolidated VIEs, where Affirm holds a variable interest but is not the primary beneficiary, the maximum exposure to losses was **$51.4 million** as of March 31, 2025, primarily through retained notes and residual trust certificates[133](index=133&type=chunk) [10. Investments](index=36&type=section&id=10.%20Investments) This section provides information on Affirm's marketable securities, including cash equivalents and available-for-sale securities, and any recognized impairments - Total marketable securities, including cash and cash equivalents and securities available for sale, decreased to **$931.4 million** as of March 31, 2025, from **$1.26 billion** as of June 30, 2024[138](index=138&type=chunk) Marketable Securities by Category (in thousands) | Category | March 31, 2025 (in thousands) | June 30, 2024 (in thousands) | | :---------------------------------------- | :---------------------------- | :--------------------------- | | Cash and cash equivalents (Money market, Commercial paper, US Gov bonds) | $151,191 | $124,845 | | Securities available for sale (CDs, Corp bonds, Commercial paper, Agency bonds, Municipal bonds, Gov bonds, Securitization notes) | $780,170 | $1,131,628 | | **Total marketable securities** | **$931,361** | **$1,256,473** | - An impairment of **$3.0 million** was recognized for non-marketable equity securities for the nine months ended March 31, 2025, compared to **$14.1 million** in the prior-year period[144](index=144&type=chunk) [11. Derivative Financial Instruments](index=40&type=section&id=11.%20Derivative%20Financial%20Instruments) This section details Affirm's use of interest rate derivatives to manage market risk, including notional amounts and fair value adjustments - Affirm uses interest rate cap agreements and interest rate swaps to manage interest rate risk, with the total notional amount of derivative instruments decreasing to **$412.5 million** as of March 31, 2025, from **$1.00 billion** as of June 30, 2024[147](index=147&type=chunk) Derivative Financial Instruments as of March 31, 2025 (in thousands) | Derivative Type | March 31, 2025 Notional Amount (in thousands) | March 31, 2025 Derivative Assets (in thousands) | March 31, 2025 Derivative Liabilities (in thousands) | | :---------------------------------- | :-------------------------------------------- | :---------------------------------------------- | :--------------------------------------------------- | | Interest rate contracts - cash flow hedges | $0 | $0 | $0 | | Interest rate contracts (not designated as hedges) | $412,489 | $3,808 | $86 | | **Total gross derivative assets/liabilities** | **$412,489** | **$3,808** | **$86** | - Net derivative losses included in Accumulated Other Comprehensive Income (AOCI) are estimated to be **$0.1 million** and are expected to be reclassified into earnings within the next 12 months[148](index=148&type=chunk) [12. Fair Value of Financial Assets and Liabilities](index=42&type=section&id=12.%20Fair%20Value%20of%20Financial%20Assets%20and%20Liabilities) This section presents the fair value measurements of Affirm's financial assets and liabilities, categorized by valuation input levels Fair Value Measurements of Financial Assets by Level (in thousands) | Fair Value Level | March 31, 2025 (in thousands) | June 30, 2024 (in thousands) | | :--------------- | :---------------------------- | :--------------------------- | | Level 1 | $69,419 | $63,389 | | Level 2 | $814,893 | $1,158,621 | | Level 3 | $95,191 | $86,128 | | **Total Assets** | **$979,503** | **$1,308,138** | - Servicing assets and liabilities, securitization notes and residual trust certificates, profit share liability, and risk sharing arrangements are classified as Level 3 fair value measurements due to the use of significant unobservable inputs[153](index=153&type=chunk) - Loans held for investment, net, had a carrying amount of **$6.26 billion** and a fair value of **$6.68 billion** as of March 31, 2025, indicating a higher market valuation than book value[178](index=178&type=chunk) [13. Stockholders' Equity](index=53&type=section&id=13.%20Stockholders'%20Equity) This section details changes in stockholders' equity, including common stock reserved for issuance, share repurchases, and warrant exercises - As of March 31, 2025, **95.4 million shares** of common stock were reserved for issuance under equity compensation plans, an increase from **91.1 million shares** as of June 30, 2024[180](index=180&type=chunk) - Affirm repurchased **3.5 million shares** of Class A common stock for approximately **$250.0 million** during the nine months ended March 31, 2025, in connection with the issuance of the 2029 Notes[184](index=184&type=chunk) - Warrants granted to Amazon, with an exercise price of **$0.01 per share**, had **3.5 million shares** exercised as of March 31, 2025, and the term for remaining unexercised warrants was extended by **4.0 years** in February 2025[182](index=182&type=chunk) [14. Equity Incentive Plans](index=54&type=section&id=14.%20Equity%20Incentive%20Plans) This section provides information on stock-based compensation expense and unrecognized compensation related to equity incentive plans Stock-Based Compensation Expense by Category (in thousands) | Category | 3 Months Ended Mar 31, 2025 (in thousands) | 3 Months Ended Mar 31, 2024 (in thousands) | 9 Months Ended Mar 31, 2025 (in thousands) | 9 Months Ended Mar 31, 2024 (in thousands) | | :---------------------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | | General and administrative | $50,344 | $51,947 | $170,868 | $184,070 | | Technology and data analytics | $21,309 | $21,105 | $70,957 | $78,808 | | Sales and marketing | $3,749 | $3,858 | $13,426 | $13,628 | | Processing and servicing | $205 | $165 | $687 | $3,092 | | Capitalized into property, equipment and software, net | $44,369 | $30,981 | $138,555 | $99,441 | | **Total stock-based compensation** | **$119,976** | **$108,056** | **$394,493** | **$379,039** | - Total stock-based compensation expense for the nine months ended March 31, 2025, was **$394.5 million**, including **$255.9 million** in operating expenses and **$138.6 million** capitalized into property, equipment, and software[198](index=198&type=chunk) - Unrecognized compensation expense related to unvested stock options was approximately **$44.1 million** (expected over **2.3 years**) and for unvested RSUs was approximately **$485.4 million** (expected over **1.7 years**) as of March 31, 2025[191](index=191&type=chunk)[196](index=196&type=chunk) [15. Restructuring](index=57&type=section&id=15.%20Restructuring) This section confirms the completion of the February 2023 restructuring plan, including workforce reduction and office space adjustments - The February 2023 restructuring plan, which included workforce reduction and vacating a portion of the San Francisco office, was completed during fiscal 2024, with no outstanding liability as of March 31, 2025[199](index=199&type=chunk)[200](index=200&type=chunk) [16. Income Taxes](index=57&type=section&id=16.%20Income%20Taxes) This section details income tax expense and the company's valuation allowance against deferred tax assets due to cumulative losses - Income tax expense for the three and nine months ended March 31, 2025, was **$2.5 million** and **$6.9 million**, respectively, primarily attributable to various U.S. state and foreign income taxes[202](index=202&type=chunk) - Affirm continues to recognize a full valuation allowance against its U.S. federal and state and certain foreign net deferred tax assets due to the cumulative loss incurred over the prior three fiscal years[203](index=203&type=chunk) [17. Net Income (Loss) per Share Attributable to Common Stockholders](index=57&type=section&id=17.%20Net%20Income%20(Loss)%20per%20Share%20Attributable%20to%20Common%20Stockholders) This section presents basic and diluted net income (loss) per share attributable to common stockholders for the reported periods Basic and Diluted EPS - 3 Months Ended March 31 | Metric | 3 Months Ended Mar 31, 2025 | 3 Months Ended Mar 31, 2024 | | :----- | :-------------------------- | :-------------------------- | | Basic | $0.01 | $(0.43) | | Diluted | $0.01 | $(0.43) | Basic and Diluted EPS - 9 Months Ended March 31 | Metric | 9 Months Ended Mar 31, 2025 | 9 Months Ended Mar 31, 2024 | | :----- | :-------------------------- | :-------------------------- | | Basic | $(0.05) | $(1.53) | | Diluted | $(0.05) | $(1.53) | - Common stock equivalents totaling **8.4 million** for the three months ended March 31, 2025, and **41.4 million** for the nine months ended March 31, 2025, were excluded from diluted EPS calculations because their inclusion would have been anti-dilutive[205](index=205&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=60&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Affirm's financial condition and results of operations, detailing its financial model, key performance factors, operating metrics, revenue and expense analysis, liquidity, and critical accounting policies [Overview](index=60&type=section&id=Overview) This section provides an overview of Affirm's mission to reinvent payments through transparent consumer financing and its proprietary technology platform - Affirm aims to reinvent payments and commerce by offering transparent, fixed-amount payment solutions without deferred interest, late fees, or penalties, empowering consumers and enabling merchants to grow sales[207](index=207&type=chunk)[208](index=208&type=chunk) - The company's core competitive advantage lies in its proprietary technology platform and data analytics, utilizing machine learning and AI to price risk and develop differentiated and scalable products[210](index=210&type=chunk) [Our Financial Model](index=61&type=section&id=Our%20Financial%20Model) This section explains Affirm's revenue model, including merchant fees, interest income, and card network revenue, and its loan origination process - Affirm's revenue model includes merchant fees (typically higher for 0% APR products), interest income on simple interest loans, and card network revenue from interchange fees on transactions facilitated through its app and Affirm Card[212](index=212&type=chunk)[213](index=213&type=chunk)[214](index=214&type=chunk) - For the three and nine months ended March 31, 2025, interest-bearing loans represented **72%** and **74%** of total GMV, respectively, while Pay-in-X and 0% APR installment loans accounted for smaller portions[213](index=213&type=chunk)[214](index=214&type=chunk) - Affirm's loan origination model involves underwriting through a proprietary risk model, with loans funded by originating bank partners (Cross River Bank, Celtic Bank, Lead Bank) or directly by Affirm's consolidated subsidiaries in Canada, the U.K., and several U.S. states[215](index=215&type=chunk)[216](index=216&type=chunk)[217](index=217&type=chunk) [Factors Affecting Our Performance](index=62&type=section&id=Factors%20Affecting%20Our%20Performance) This section discusses key factors influencing Affirm's performance, such as its funding model, product mix, and the macroeconomic environment - Affirm's performance is influenced by its capital-efficient funding model, which leverages diverse funding relationships including warehouse facilities, securitization trusts, forward flow arrangements, and bank partnerships[220](index=220&type=chunk) - Shifts in merchant volumes and product mix (e.g., low AOV vs. high AOV, 0% APR vs. interest-bearing) significantly impact GMV and revenue as a percentage of GMV, with low AOV offerings potentially leading to a decline in revenue as a percentage of GMV in the medium term[221](index=221&type=chunk)[222](index=222&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk) - The macroeconomic environment, including inflation, interest rates, and recessionary concerns, affects consumer demand, borrowing costs, and capital market volatility, impacting Affirm's business and results of operations[226](index=226&type=chunk) [Key Operating Metrics](index=64&type=section&id=Key%20Operating%20Metrics) This section presents key operating metrics, including Gross Merchandise Volume (GMV), active consumers, and transactions per active consumer Key Operating Metrics | Metric | 3 Months Ended Mar 31, 2025 | 3 Months Ended Mar 31, 2024 | % Change | 9 Months Ended Mar 31, 2025 | 9 Months Ended Mar 31, 2024 | % Change | | :-------------------------- | :-------------------------- | :-------------------------- | :------- | :-------------------------- | :-------------------------- | :------- | | GMV (in billions) | $8.6 | $6.3 | 36% | $26.3 | $19.4 | 36% |\ | Active consumers (in thousands) | 21,888 | 18,134 | 21% | N/A | N/A | N/A |\ | Transactions per active consumer | 5.6 | 4.6 | 20% | N/A | N/A | N/A | - GMV increased by **36%** for both the three and nine months ended March 31, 2025, driven by growth in top five merchants, platform partners, direct-to-consumer products (Affirm Card), and overall increases in active merchants and consumers[233](index=233&type=chunk) - Active consumers grew **21%** to **21.9 million** as of March 31, 2025, and transactions per active consumer increased **20%** to **5.6**, indicating strong consumer adoption and repeat usage, with Affirm Card representing approximately **10%** of total transactions[238](index=238&type=chunk)[240](index=240&type=chunk) [Results of Operations](index=66&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of Affirm's revenue and operating expenses, leading to its operating and net income (loss) Results of Operations - 3 Months Ended March 31 (in thousands) | Metric (in thousands) | 2025 | 2024 | Change ($) | Change (%) | | :-------------------------------- | :---------- | :---------- | :---------- | :--------- | | Total revenue, net | $783,135 | $576,157 | $206,978 | 36% | | Total operating expenses | $791,527 | $736,946 | $54,581 | 7% | | Operating loss | $(8,393) | $(160,789) | $152,396 | (95)% | | Net income (loss) | $2,804 | $(133,936) | $136,740 | (102)% | Results of Operations - 9 Months Ended March 31 (in thousands) | Metric (in thousands) | 2025 | 2024 | Change ($) | Change (%) | | :-------------------------------- | :---------- | :---------- | :---------- | :--------- | | Total revenue, net | $2,347,995 | $1,663,814 | $684,181 | 41% | | Total operating expenses | $2,493,332 | $2,206,201 | $287,131 | 13% | | Operating loss | $(145,337) | $(542,387) | $397,050 | (73)% | | Net income (loss) | $(17,058) | $(472,621) | $455,563 | (96)% | - Sales and marketing expense decreased by **$58.9 million (44%)** for the three months and **$85.8 million (19%)** for the nine months ended March 31, 2025, primarily due to a significant decrease in Amazon warrant expense as a portion of the warrants became fully vested[265](index=265&type=chunk) [Liquidity and Capital Resources](index=72&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses Affirm's liquidity position, capital resources, and funding strategy, including cash, investments, and available debt capacity - Affirm maintains a capital-efficient model through a diverse set of funding sources, including warehouse credit facilities, securitization trusts, forward flow arrangements, and partnerships with banks[271](index=271&type=chunk) Cash, Cash Equivalents and Investments in Debt Securities (in thousands) | Category | March 31, 2025 (in thousands) | June 30, 2024 (in thousands) | | :---------------------------------------- | :---------------------------- | :--------------------------- | | Cash and cash equivalents | $1,351,148 | $1,013,106 | | Investments in short-term debt securities | $537,159 | $865,766 | | Investments in long-term debt securities | $243,011 | $265,862 | | **Cash, cash equivalent and investments in debt securities** | **$2,131,318** | **$2,144,734** | - As of March 31, 2025, Affirm had **$2.1 billion** in cash and investments, **$4.4 billion** in available funding debt capacity, and **$330.0 million** in revolving credit facility borrowing capacity, which are believed to be sufficient for the next 12 months[272](index=272&type=chunk) [Off-Balance Sheet Arrangements](index=76&type=section&id=Off-Balance%20Sheet%20Arrangements) This section describes Affirm's off-balance sheet activities, primarily through unconsolidated VIEs and securitization transactions, and associated risk exposures - Affirm engages in off-balance sheet activities, primarily through unconsolidated Variable Interest Entities (VIEs) and sponsored securitization transactions, where it contractually services loans[296](index=296&type=chunk) - As of March 31, 2025, the aggregate outstanding balance of loans held by third-party investors and off-balance sheet securitizations was **$6.8 billion**[299](index=299&type=chunk) - For unconsolidated securitization transactions, Affirm's maximum exposure to losses as the sponsor and risk retention holder is up to **5%** of both the senior notes and residual trust certificates[298](index=298&type=chunk) [Critical Accounting Policies and Estimates](index=76&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms no material changes to Affirm's critical accounting policies or estimates during the reported periods - There have been no material changes in Affirm's significant accounting policies or critical accounting estimates during the three and nine months ended March 31, 2025[300](index=300&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=77&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details Affirm's exposure to market risks, primarily interest rate risk and credit risk, and the strategies employed to manage them, including impacts on fixed-rate securities, variable-rate debt, and consumer loans [Interest Rate Risk](index=77&type=section&id=Interest%20Rate%20Risk) This section discusses Affirm's exposure to interest rate fluctuations and its potential impact on financial instruments and operations - Affirm is exposed to interest rate risk due to its **$780.2 million** of marketable debt securities and variable-rate funding arrangements, including warehouse facilities and securitization variable funding notes[303](index=303&type=chunk)[305](index=305&type=chunk) - A hypothetical instantaneous **100 basis point** upward parallel shock to interest rates is estimated to have a less than **$60.0 million** adverse impact on cash flows associated with market risk sensitive instruments over the next 12 months[306](index=306&type=chunk) - Continued volatility in interest rates and inflation may adversely impact consumer spending levels, repayment ability, and loan sale economics, potentially leading to increased delinquencies and charge-offs[304](index=304&type=chunk)[305](index=305&type=chunk) [Credit Risk](index=78&type=section&id=Credit%20Risk) This section outlines Affirm's credit risk exposure, primarily from consumer loans and off-balance sheet arrangements, and its mitigation strategies - Affirm's primary credit risk relates to its **$6.6 billion** in consumer loans held for investment as of March 31, 2025, which is managed through proprietary underwriting models, user limits, and down payment requirements[307](index=307&type=chunk)[309](index=309&type=chunk) - The company also has credit risk exposure from **$7.8 billion** of off-balance sheet loans subject to risk-sharing arrangements (maximum exposure **$94.3 million**) and retained interests in unconsolidated securitization trusts (**$50.9 million**)[310](index=310&type=chunk) - Loan receivables are geographically diversified, with approximately **11%** related to customers residing in California and **10%** in Texas as of March 31, 2025[309](index=309&type=chunk) [Item 4. Controls and Procedures](index=79&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms that Affirm's management, including the CEO and CFO, evaluated the effectiveness of its disclosure controls and procedures, concluding they were effective as of March 31, 2025. It also states there were no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that Affirm's disclosure controls and procedures were effective as of March 31, 2025, and designed to ensure timely and accurate reporting[312](index=312&type=chunk) - No material changes in internal control over financial reporting occurred during the quarter ended March 31, 2025[313](index=313&type=chunk) Part II - Other Information This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits [Item 1. Legal Proceedings](index=80&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 7 for details on legal proceedings and reiterates that no other current legal proceedings are expected to have a material adverse effect on the business, despite the inherent uncertainties and costs of litigation - Affirm is not presently a party to any legal proceedings that, if determined adversely, would individually or collectively have a material adverse effect on its business, results of operations, financial condition, or cash flows[317](index=317&type=chunk) [Item 1A. Risk Factors](index=80&type=section&id=Item%201A.%20Risk%20Factors) This section highlights that the risks described in the Annual Report on Form 10-K for fiscal year 2024, along with updated risks related to indebtedness, could materially affect Affirm's business. It specifically addresses the substantial cash requirements for debt servicing and the potential inability to raise funds for convertible note settlements or repurchases - Servicing Affirm's debt, including the 2026 and 2029 Convertible Senior Notes, requires a significant amount of cash, and the company's future performance may not be sufficient to meet these obligations[321](index=321&type=chunk) - Affirm may not have the ability to raise the necessary funds to settle conversions of its convertible notes, repay them at maturity, or repurchase them upon a fundamental change, which could lead to a default on debt obligations[322](index=322&type=chunk)[323](index=323&type=chunk) - There have been no material changes to risk factors from the Annual Report on Form 10-K for the fiscal year ended June 30, 2024, except as reflected in the updated risks related to indebtedness[320](index=320&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=81&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section states that there were no unregistered sales of equity securities or use of proceeds to report for the period - No unregistered sales of equity securities or use of proceeds occurred during the reporting period[324](index=324&type=chunk) [Item 3. Defaults Upon Senior Securities](index=81&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section indicates that there were no defaults upon senior securities during the reporting period - No defaults upon senior securities occurred during the reporting period[325](index=325&type=chunk) [Item 4. Mine Safety Disclosures](index=81&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that mine safety disclosures are not applicable to Affirm's business - Mine safety disclosures are not applicable to the company[326](index=326&type=chunk) [Item 5. Other Information](index=82&type=section&id=Item%205.%20Other%20Information) This section discloses that Affirm's Chief Operating Officer, Michael Linford, and Chief Executive Officer, Max Levchin, adopted Rule 10b5-1 trading plans during the three months ended March 31, 2025, for the exercise of stock options and sale of underlying Class A common stock - Michael Linford, COO, adopted a Rule 10b5-1 trading plan on February 14, 2025, for the exercise of up to **200,000 employee stock options** and sale of underlying Class A common stock between May 16, 2025, and November 15, 2025[327](index=327&type=chunk) - Max Levchin, CEO, adopted a Rule 10b5-1 trading plan on March 17, 2025, for the exercise of up to **4,000,000 employee stock options** and sale of underlying Class A common stock between June 20, 2025, and June 18, 2026[328](index=328&type=chunk) [Item 6. Exhibits](index=83&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including warrant agreements, commercial agreements, cash incentive plans, officer severance plans, certifications, and XBRL-related documents - Key exhibits include the Second Replacement Warrant to Purchase Class A Common Stock with Amazon.com Services LLC and the Global Customer Installment Program Agreement with Shopify Inc., both dated February 14, 2025[331](index=331&type=chunk) - The filing includes certifications from the Principal Executive Officer and Principal Financial Officer as required by the Sarbanes-Oxley Act of 2002[331](index=331&type=chunk) [Signatures](index=84&type=section&id=Signatures) This section contains the signatures of Affirm Holdings, Inc.'s Chief Executive Officer, Max Levchin, and Chief Financial Officer, Rob O'Hare, certifying the filing of the report on May 8, 2025 - The report was signed by Max Levchin, Chief Executive Officer, and Rob O'Hare, Chief Financial Officer, on May 8, 2025[336](index=336&type=chunk)

FY Q3 2025 Earnings Supplement May 8, 2025 Safe Harbor Statement/Use of Non-GAAP Financial Measures Cautionary Note About Forward-Looking Statements 2 OUR MISSION This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. All statements other than statements of historical fact are forward-looking statements, inclu ...

Core Insights - Affirm's revenue forecast for the current quarter is below analysts' estimates, leading to a 10% drop in stock price during extended trading [1] - The company reported a gross merchandise volume (GMV) of $8.6 billion, exceeding the average estimate of $8.2 billion, with a year-over-year increase of 36% [1] - Revenue for the quarter rose 36% to $783 million compared to $576 million a year ago, with net income of $2.8 million, a significant improvement from a loss of $133.9 million a year earlier [2][5] Financial Performance - The revenue less transaction costs (RLTC) margin was reported at 4.1%, slightly above the long-term target range of 3% to 4% [2] - Adjusted operating margin was 22%, surpassing the estimate of 21.6% [2] - Earnings per share were reported at 1 cent, compared to an expected loss of 3 cents [5] Future Guidance - For the current quarter, Affirm is guiding for revenue between $815 million and $845 million, with a midpoint of $830 million, which is below the average estimate of $841 million [3] Market Context - Affirm's business is closely linked to consumer spending, particularly in sectors like electronics, apparel, and travel [4] - The U.S. economy experienced contraction in early 2025, influenced by an import surge as companies and consumers anticipated tariffs [4]

affirm) Third Fiscal Quarter 2025 We continued to lean into 0% APR monthly installments which grew 44% year over year, and constituted 13% of total GMV, the highest level in the past two years. While Shareholder Letter (a) ·1234 Pay over time Pay in full a Purchasing power ( $1,200 Plan a purchase Get as low as 0% APR on all essential electronics at Radio City -> Fellow Affirm Shareholders, In FQ3'25 we delivered another strong set of results: Gross Merchandise Volume Revenue Less Transaction Revenue Costs ...

Core Viewpoint - Market participants are concerned about the Trump administration's tariff and trade policies and their potential impact on U.S. economic growth and inflation [1] Group 1: Growth Stocks - Five growth stocks identified for May include Agnico Eagle Mines Ltd. (AEM), Sony Group Corp. (SONY), Affirm Holdings Inc. (AFRM), Broadcom Inc. (AVGO), and Expand Energy Corp. (EXE) [2][6] Group 2: Agnico Eagle Mines Ltd. (AEM) - AEM is focused on production growth through projects like the Kittila expansion and acquisitions such as Hope Bay and the merger with Kirkland Lake Gold [7][8] - AEM's expected revenue and earnings growth rates are 20.6% and 44.4% respectively for the current year, with a Zacks Consensus Estimate for earnings improving by 6.1% [8] - The average short-term price target indicates a potential increase of 16% from the last closing price of $119.13, with a maximum upside of 33.5% [9] Group 3: Sony Group Corp. (SONY) - SONY is expected to grow due to strengths in Game & Network Services, Music, and Financial Services, despite challenges in the Entertainment, Technology & Services unit [10][11] - The expected revenue and earnings growth rates for SONY are 0.7% and 14.4% respectively for the current year, with a Zacks Consensus Estimate for earnings improving by 0.7% [12] - The average short-term price target suggests a potential increase of 17.2% from the last closing price of $25.23, indicating a maximum upside of 35% [12] Group 4: Affirm Holdings Inc. (AFRM) - AFRM has strong revenue growth from diverse income streams, expecting revenues between $3.13 billion and $3.19 billion in fiscal 2025 [14][15] - Key partnerships, including those with Apple Pay and Hotels.com, are crucial for AFRM's expansion [15] - The expected revenue and earnings growth rates for AFRM are 37.1% and 96.4% respectively for the current year, with a Zacks Consensus Estimate for earnings improving by 60% [16] Group 5: Broadcom Inc. (AVGO) - AVGO is benefiting from strong demand for networking products and AI accelerators, with expected AI revenues to jump 44% year over year to $4.4 billion [18][19] - The acquisition of VMware has enhanced AVGO's infrastructure software solutions, with 70% of its largest customers adopting VMware Cloud Foundation [19] - AVGO's expected revenue and earnings growth rates are 21% and 35.5% respectively for the current year, with a Zacks Consensus Estimate for earnings improving by 4.6% [21] Group 6: Expand Energy Corp. (EXE) - EXE has become the largest U.S. natural gas producer after merging with Chesapeake and Southwestern, with plans to ramp up production to 7,100 MMcfe/day by 2025 [24][25] - The expected revenue and earnings growth rates for EXE are over 100% each for the current year, with a Zacks Consensus Estimate for earnings improving by 6.6% [26] - The average short-term price target indicates a potential increase of 13.2% from the last closing price of $108.51, suggesting a maximum upside of 56.7% [26]

Core Viewpoint - Affirm Holdings, Inc. is expected to report its third-quarter fiscal 2025 results on May 8, 2025, with a projected loss of 8 cents per share on revenues of $783.1 million, indicating significant year-over-year improvements in both earnings and revenues [1][2]. Financial Performance - The fiscal third-quarter earnings estimate has improved by 2 cents over the past month, reflecting an 81.4% year-over-year improvement [1]. - The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year growth of 35.9% [1]. - For the current fiscal year, the revenue estimate is pegged at $3.2 billion, implying a rise of 37.1% year over year, while the EPS consensus is a loss of 6 cents, indicating a 96.4% improvement year over year [2]. Earnings Expectations - Affirm is predicted to beat earnings estimates due to a positive Earnings ESP of +63.27% and a Zacks Rank of 1 (Strong Buy) [3]. - The company has consistently beaten consensus estimates for earnings in the last four quarters, with an average surprise of 84.1% [2]. Revenue Drivers - Merchant network revenues are expected to reach $199.5 million, indicating a 25.2% rise from the prior-year quarter [5]. - The Gross Merchandise Volume (GMV) is anticipated to grow by 29.2% year-over-year, with management estimating it to be in the range of $8-$8.3 billion [6]. - Active consumers are projected to grow by 17.4% year-over-year, and transactions per active consumer are expected to rise by 16.5% [7]. Card Network and Interest Income - Card network revenues are expected to improve by 30% year-over-year, while interest income is pegged at $414.4 million, indicating a 31.3% year-over-year rise [8]. - Servicing income is estimated to reach nearly $31.3 million, reflecting a 23.6% increase from the year-ago quarter [9]. Transaction Costs - The company anticipates higher transaction costs in the range of $415-$430 million for the quarter [9]. Stock Performance - Affirm's stock has increased by 38.6% over the past month, outperforming the industry growth of 19.4% and significantly surpassing the S&P 500's increase of 12.3% [10]. Valuation - Despite the recent stock price appreciation, Affirm's valuation remains relatively cheap at 4.34X forward 12-month sales, below the industry average of 5.12X [13]. Competitive Landscape - The delay of Klarna's IPO has reduced competitive pressure in the BNPL space, benefiting Affirm as one of the few publicly traded players [18]. - Concerns regarding Walmart's relationship with Affirm are considered overblown, as Walmart contributed only 5% to Affirm's GMV [18]. Long-term Outlook - Affirm is expanding internationally and diversifying its offerings, which positions it to compete with major players like Visa and PayPal [19]. - The company is focusing on profitability by tightening underwriting standards and improving margins, which is expected to bolster investor confidence [19].

[Click here for information about joining the class action] On March 17, 2025, the fintech company Klarna, in advance of its initial public offering in the U.S., announced that it was replacing Affirm as the exclusive provider of Buy Now, Pay Later ("BNPL") loans for Walmart. On this news, Affirm's stock price fell $6.38 per share, or 12.74%, over the following two trading sessions, to close at $43.70 per share on March 18, 2025. Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, ...

Core Viewpoint - Affirm Holdings (AFRM) is showing potential for investment due to its recent technical performance, particularly crossing above the 200-day moving average, indicating a long-term bullish trend [1] Technical Analysis - The 200-day simple moving average is a significant tool for identifying long-term market trends, and it serves as a support or resistance level [2] - Over the past four weeks, AFRM has experienced a substantial gain of 46.4% [2] - The stock is currently rated as a Zacks Rank 1 (Strong Buy), suggesting further upward movement is likely [2] Earnings Estimates - Positive revisions in earnings estimates bolster the bullish outlook for AFRM, with one upward revision and no downward revisions for the current fiscal year [3] - The consensus earnings estimate has also increased, indicating growing investor confidence [3] - Investors are encouraged to monitor AFRM for potential gains in the near future, given its key technical levels and favorable earnings revisions [3]