Financial Data and Key Metrics Changes - The company originated 16% more in new customer volume during the quarter, resulting in a 25% increase in outstanding ledger for active new customers compared to the same quarter last year [3][5] - Yields improved by 84 basis points year-over-year, indicating an increase in income [4] - Organic growth in ledger was 2.4% year-over-year, a recovery from a decline of 2.4% last year [6] Business Line Data and Key Metrics Changes - The first pay defaults for new customers are 19% lower compared to the same period in fiscal 2022, reflecting improved credit performance [4][5] - The average outstanding loan balance declined by approximately 2.5% year-over-year due to stricter underwriting and larger investments in new customers [6][7] Market Data and Key Metrics Changes - The customer base has grown organically by around 5.4% year-over-year, a significant increase from 2.2% last year [5] - The company has repurchased nearly 600,000 shares, reducing outstanding shares by 11% in the first nine months of the year [8] Company Strategy and Development Direction - The company is focused on improving branch operations and personnel management, with a commitment to long-term profitability and soundness of the portfolio [7][10] - There is an emphasis on maintaining credit quality while improving loan approval rates and customer retention [10] Management's Comments on Operating Environment and Future Outlook - Management has not observed any degradation in collections or credit quality, with a slight increase in demand noted [13] - There is optimism regarding the upcoming tax filing season, expecting larger refunds due to recent tax law changes [14] Other Important Information - The company has over $60 million remaining capacity for share repurchases, which could total around 20% of outstanding shares this year [8] - The current ice storm has affected some branches, but management remains optimistic about tax filing volume and revenue [9] Q&A Session Summary Question: Update on the health of the underlying consumer and trends observed - Management noted no significant change in consumer behavior and an increase in demand, with expectations for larger tax refunds this year [12][13] Question: Growth in G&A expenses and future trends - Management expects to see a decrease in incentive compensation expenses starting in Q4 due to a share-based comp grant being fully expensed [15][16] Question: Increase and subsequent reduction in headcount - The increase was to build a quality team in anticipation of turnover, while the reduction is expected due to underperforming team members [19][20] Question: Implications of a 10% cap on credit cards - Management indicated that while there are no direct implications for their major portfolio, a cap could drive demand for installment loans [21][22][23]

Financial Data and Key Metrics Changes - The company originated 16% more in new customer volume during the quarter, resulting in a 25% increase in outstanding ledger for active new customers compared to the same quarter last year [3] - Yields improved by 84 basis points year-over-year, indicating an increase in income [4] - Organic growth in ledger was 2.4% year-over-year, a recovery from a decline of 2.4% last year [6] Business Line Data and Key Metrics Changes - The first pay defaults for new customers are 19% lower compared to the same period in fiscal 2022, indicating improved credit performance [4][5] - The average outstanding loan balance declined by approximately 2.5% year-over-year due to stricter underwriting and larger investments in new customers [6] Market Data and Key Metrics Changes - The customer base has grown organically by around 5.4% year-over-year, a significant increase from 2.2% last year [5] - The company has seen substantial improvement in tax filing volume and revenue year-over-year, with expectations for larger tax refunds this year due to tax law changes [9][14] Company Strategy and Development Direction - The company is focused on improving branch operations and personnel management, with a commitment to long-term profitability and soundness of the portfolio [7][10] - There is an ongoing strategy to reduce headcount by 3%-5% in field-level offices, following an increase to build a quality team in anticipation of turnover [19] Management's Comments on Operating Environment and Future Outlook - Management has not observed any degradation in collections or credit quality, with a slight increase in demand noted [13] - The company remains optimistic about the upcoming tax filing season, expecting increased demand and larger refunds [14] Other Important Information - The company has repurchased nearly 600,000 shares, reducing outstanding shares by 11% in the first nine months of the year, with a remaining capacity for repurchases of over $60 million [8] - The current ice storm has affected operations in approximately 10 states, but management remains optimistic about revenue growth [9] Q&A Session Summary Question: Update on the health of the underlying consumer and outlook into tax refund season - Management has not seen a degradation in collections or credit quality, with an increase in demand and expectations for larger tax refunds this year [13][14] Question: Growth in G&A and future trends - Management expects to see a decrease in incentive compensation expenses starting in Q4, following a share-based comp grant last December [16] Question: Increase and subsequent decrease in headcount - The increase was to build a quality team in anticipation of turnover, with a reduction expected to occur quickly within the current quarter [19] Question: Implications of a 10% cap on credit cards - Management believes there would be a severe reduction in access to credit cards for lower credit scores, potentially increasing demand for installment loans [22][23]

Financial Data and Key Metrics Changes - The company originated 16% more in new customer volume during the quarter, resulting in a 25% increase in outstanding ledger for active new customers compared to the same quarter last year [3][4] - Yields improved by 84 basis points year-over-year, indicating an increase in income [4] - Organic growth in ledger was 2.4% year-over-year, a recovery from a decline of 2.4% last year [6] Business Line Data and Key Metrics Changes - The first pay defaults for new customers are 19% lower compared to the same period in fiscal 2022, indicating improved credit performance [4][5] - The average outstanding loan balance declined by approximately 2.5% year-over-year due to increased discipline in underwriting [6] Market Data and Key Metrics Changes - The customer base has grown organically by around 5.4% year-over-year, a significant increase from 2.2% growth last year [5] - The company has seen substantial improvement in tax filing volume and revenue year-over-year, with expectations for larger tax refunds this year due to tax law changes [8][12] Company Strategy and Development Direction - The company is focused on improving branch operations and personnel management, with a commitment to long-term profitability and soundness of the portfolio [6][9] - There is an ongoing strategy to repurchase shares, with nearly 600,000 shares repurchased, reducing outstanding shares by 11% [7] Management Comments on Operating Environment and Future Outlook - Management has not observed any degradation in collections or credit quality, with a slight increase in demand noted [12] - The company remains optimistic about the upcoming tax filing season, expecting increased demand and larger refunds [13] Other Important Information - The company has temporarily overstaffed to enhance branch team performance, with plans to reduce headcount by 3%-5% in the near future [18] - The current ice storm has affected operations in approximately 10 states, but management remains optimistic about revenue growth [8] Q&A Session Summary Question: Update on the health of the underlying consumer and outlook for tax refund season - Management noted no significant changes in consumer behavior and an increase in demand for tax filings, expecting larger refunds this year due to tax law changes [12][13] Question: Growth in G&A expenses and future trends - Management expects a decrease in incentive compensation expenses starting in Q4, with a share-based comp grant fully expensed [15] Question: Increase in headcount and subsequent reduction - The increase was to build a quality team in anticipation of turnover, with a reduction expected soon as underperforming team members are addressed [18] Question: Impact of a potential 10% cap on credit cards - Management indicated that while there are no direct implications for their major portfolio, a cap could increase demand for installment loans [20][21]

Core Insights - Affirm is expanding its partnership with New York Life Insurance, indicating a trend where traditional financial institutions are increasingly engaging with fintech-driven consumer lending [1][2] - Under the new agreement, New York Life will purchase up to $750 million worth of Affirm's installment loans through 2026, which will support approximately $1.75 billion in annual loan volume for Affirm [1] - The partnership builds on a relationship initiated in 2023, where New York Life began investing in Affirm's asset-backed securities, contributing nearly $2 billion to Affirm's collateral pools to date [2] - This collaboration reflects a broader trend of insurers and private-credit investors entering consumer finance, driven by the attractiveness of these assets amid rising interest rates [2]

Company Overview - Affirm Holdings, Inc. is a leading financial technology company that offers installment loans to consumers at the point of sale, founded in 2012 [1] - The company competes with other buy-now-pay-later services like Afterpay and Klarna [1] Financial Metrics - Affirm has a high price-to-earnings (P/E) ratio of 560.21, indicating a high valuation relative to its earnings, yet investor interest remains strong [2][6] - The price-to-sales ratio stands at 8.95, suggesting that investors are willing to pay nearly nine times the company's sales per share, reflecting confidence in its growth potential [3][6] - The enterprise value to sales ratio is 10.97, highlighting the company's total valuation in relation to its sales [3] - The enterprise value to operating cash flow ratio is 44.55, indicating a high valuation compared to its cash flow from operations [4] - The earnings yield is relatively low at 0.18%, which may concern some investors [4] - Affirm's current ratio is strong at 54.19, demonstrating its robust ability to cover short-term liabilities with short-term assets [4] Leverage and Growth Strategy - The debt-to-equity ratio is 2.56, showing that Affirm has more than twice as much debt as equity, which may pose risks but also highlights the company's aggressive growth strategy [5][6]