Affirm Holdings (NASDAQ: AFRM ) reported a very strong quarter and continued to demonstrate its progress around profitability. Affirm clearly took advantage of the holiday shopping period and their customer base has remained resilient. Consumers are increasingly shifting towards buy-now-pay-later ("BNPL") operators rather than theAnalyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 ho ...

Affirm Holdings, Inc.’s (AFRM) shares gained 21.8% on Feb. 7, reflecting investor optimism about the company's prospects, after a robust quarter. AFRM’s strong quarterly results benefited from higher network revenues and servicing income. Higher transactions, robust repeat customer engagement and a successful holiday shopping season also boosted performance. However, the results were partly offset by an escalating expense level, which was primarily due to a significant increase in provision for credit losse ...

Core Insights - Affirm Holdings reported Q2 fiscal 2025 revenue of $866 million, exceeding market expectations of $807 million, and earnings per share of $0.23, compared to a projected loss of $0.15 [1][3] - The stock surged 22% following the earnings report, with a year-to-date return of 53%, outperforming the S&P 500's 26% increase [1][2] Financial Performance - Revenue growth of 47% year-over-year, driven by a 138% increase in gain on sale of loans, 33% rise in network revenue, 42% surge in interest income, and 28% increase in servicing income [2] - Gross merchandise volume (GMV) grew 35% year-over-year to $10.1 billion, indicating improved monetization [2] - Active consumers increased by 19% to 21 million, with a 22% rise in transactions per active user [2] Future Outlook - The company anticipates Q3 revenues around $770 million, aligning with consensus estimates [3] - Current stock trading at 8.5x trailing revenues, slightly below the 8.6x average P/S ratio over the past two years, suggesting potential for upward revision in valuation [6] - A projected price target of $84 implies a 12% upside from current levels based on a P/S ratio of 9.5x [6]

Analyst’s Disclosure: I/we have a beneficial long position in the shares of SOFI, PYPL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether ...

Core Viewpoint - Affirm Holdings (AFRM) has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on a company's changing earnings picture, which is crucial for near-term stock price movements [2][4]. - Rising earnings estimates for Affirm Holdings indicate an improvement in the company's underlying business, likely leading to increased stock prices [5][8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7][9]. - Affirm Holdings' upgrade to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10]. Earnings Estimate Revisions - Analysts have raised their earnings estimates for Affirm Holdings, with the Zacks Consensus Estimate for the fiscal year ending June 2025 projected at -$0.59 per share, reflecting a year-over-year change of 64.7% [8]. - Over the past three months, the consensus estimate has increased by 3.7%, indicating positive sentiment among analysts [8].

Shares of Affirm Holdings Inc AFRM spiked in early trading on Friday after the company reported upbeat fiscal second-quarter results.The company released its quarterly results amid an exciting earnings season. Here are some key analyst takeaways.JMP Securities On Affirm HoldingsAnalyst David Scharf reiterated a Market Outperform rating, while raising the price target from $78 to $85.Affirm Holdings reported its fiscal second-quarter revenues and earnings significantly ahead of expectations, Scharf said in a ...

Max Levchin, co-founder of PayPal and chief executive officer of financial technology company Affirm, arrives at the Sun Valley Resort for the annual Allen & Company Sun Valley Conference, in Sun Valley, Idaho.Affirm shares jumped 16% Friday after the buy now, pay later company topped Wall Street's fiscal second-quarter revenue forecast and posted a surprise profit during a strong holiday shopping period.Earnings came in at 23 cents per share, ahead of the 15-cent per share loss expected by analysts polled ...

About this content About Angela Harmantas Angela Harmantas is an Editor at Proactive. She has over 15 years of experience covering the equity markets in North America, with a particular focus on junior resource stocks. Angela has reported from numerous countries around the world, including Canada, the US, Australia, Brazil, Ghana, and South Africa for leading trade publications. Previously, she worked in investor relations and led the foreign direct investment program in Canada for the Swedish government ...

Core Insights - A strong holiday shopping season and the popularity of buy now, pay later (BNPL) options contributed to Affirm Holding's growth in gross merchandise volumes (GMV) and active consumer base [1] Financial Performance - Affirm's second quarter GMV increased by 35% to $10.1 billion, with 0% APR monthly installment GMV growing by 70% [2] - Revenues rose by 47% to $866 million, with the company nearing its target date for positive operating income [3] - GMV growth by product category included a 40% increase in general merchandise and a 36% increase in electronics [4] Consumer Engagement - Active consumers increased by 23% to 21 million, with transactions per active consumer rising 22% year over year to 5.3 [2] - The Affirm Card GMV reached $845 million, up 113% year over year, with active consumers increasing by 136% to 1.7 million [6] Promotional Strategies - The growth in 0% APR offerings was driven by merchants seeking promotional strategies during the holiday season, which included channeling promotional dollars into reduced APRs [5] - App-started 0% APR GMV grew by 260%, indicating significant potential for further engagement through the card [7] Credit Metrics - The 30-plus-day delinquency rate remained stable at 2.5%, consistent with pre-pandemic levels, showing improvement from the previous quarter [7] Integration and Growth - Wallet integrations are progressing well, contributing positively to transaction metrics and credit quality [8][9]

Financial Data and Key Metrics Changes - The company reported a strong quarter with active customers up 23% year-over-year, marking four consecutive quarters of accelerating growth [68] - The company achieved an RLTC margin above the previously guided range of 3% to 4%, indicating effective management of loan sales and securitization [20][38] Business Line Data and Key Metrics Changes - The increase in zero percent loans is part of a broader strategy to attract consumers by offering interest-free financing, which has been well-received by merchants and consumers alike [12][14] - The company is focusing on expanding its direct-to-consumer offerings, which has contributed significantly to the increase in active consumers [69] Market Data and Key Metrics Changes - The company is experiencing strong demand in the UK market, with significant interest from merchants for longer-term loans, indicating a potential for market share growth [50][51] - The integration of wallet partners is showing positive metrics, contributing to higher transaction rates and improved credit quality [43][45] Company Strategy and Development Direction - The company is committed to maintaining a long-term RLTC margin between 3% and 4%, while also investing in zero percent loan programs to enhance consumer reach [30][32] - The focus on AI and machine learning is aimed at improving underwriting processes and operational efficiency, allowing for better credit management without increasing headcount [81][84] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current economic environment, noting that consumers are healthy and actively shopping, which supports continued lending [130] - The company is prepared to adapt to changing macroeconomic conditions while maintaining its core values and commitment to consumer-friendly practices [134][135] Other Important Information - The company is actively working on enhancing its app to better showcase zero percent deals, which is expected to drive further consumer engagement [97][100] - The partnership with Sixth Street is expected to ramp up in the second half of 2025, indicating a strategic move to scale capital programs [58][65] Q&A Session Summary Question: About the increase in zero percent loans and strategy behind it - Management indicated that the increase in zero percent loans is a strategic initiative to attract more consumers and is being deployed across various merchant partnerships [12][14] Question: Regarding the RLTC margin and reinvestment strategy - Management confirmed that the excess RLTC will be reinvested into zero percent loans, which may slightly dilute margins but is expected to enhance overall network growth [20][22] Question: Update on UK launch and market share potential - Management noted that while it is early to predict market share in the UK, there is significant demand for their diverse loan offerings, which positions them well against incumbents [50][51] Question: Funding mix and future partnerships - Management expressed pride in their capital market progress and indicated that while they will continue to explore partnerships, they do not expect to replicate the scale of the Sixth Street partnership in the near term [58][60] Question: Customer growth and marketing expenses - Management highlighted that the increase in active customers is a result of focused efforts on direct-to-consumer strategies, and marketing expenses are expected to remain consistent moving forward [73][76] Question: AI utilization and impact on headcount - Management confirmed that AI has been integral to their operations since inception, enhancing productivity and allowing for a more specialized workforce without increasing overall headcount [81][84] Question: Durability of funding cost improvements - Management acknowledged that while current market conditions are favorable, their strong credit performance has established durable relationships with capital partners [157][158] Question: Insights on the Affirm card and customer relationships - Management noted that the Affirm card is attracting their best customers, and there is significant potential for expanding services to those who trust them with direct deposits [163][164]