Key Takeaways AFRM's Q3 transaction count rose 46% YoY, supported by proprietary tech and risk management systems. 0% APR monthly instalment GMV rose 44% YoY, boosting volume but pressuring AFRM's interest-based income. AFRM aims to offset lower margins with higher merchant fees and stronger borrower quality.Affirm Holdings, Inc. (AFRM) has developed a robust system to handle a higher number of transactions by leveraging its proprietary technology infrastructure, deep data capabilities and efficient risk ...

Core Insights - Affirm Holdings, Inc. (AFRM) is focused on reinventing payments through a diverse merchant network, which has grown to approximately 358,000 active merchants as of March 31, 2025, up from around 292,000 the previous year [1][10] Merchant Network and Partnerships - The merchant partners of Affirm span various industries, including fashion, electronics, travel, and home and lifestyle, utilizing Affirm's buy now, pay later (BNPL) solutions to enhance average order values and customer conversion rates [2] - Recent partnerships include collaborations with Shopmonkey and Xsolla, extending payment solutions to auto repairs and game developers, while partnerships with Williams-Sonoma and KAYAK facilitated entry into the Canadian market [3] Financial Performance - In the first nine months of fiscal 2025, Affirm's gross merchandise volume (GMV) reached $26.3 billion, reflecting a 36% year-over-year increase, with expectations for fiscal 2025 GMV to be between $35.7 billion and $36 billion, indicating a 34.8% rise at the midpoint [5][10] - Merchant network revenues improved by 30% year-over-year during the same period [10] Competitive Landscape - Key competitors in the BNPL space include PayPal Holdings, Inc. (PYPL) and Sezzle Inc. (SEZL), with PayPal reporting over 36 million merchants globally and a 1% year-over-year revenue increase to $7.8 billion [6][7] - Sezzle's merchant base exceeds 40,000 businesses, with total revenues more than doubling year-over-year to $104.9 million, supported by a 64.1% rise in GMV [8] Stock Performance and Valuation - Affirm's stock has surged 132.1% over the past year, outperforming the industry growth of 41.2% [9] - The company trades at a forward price-to-sales ratio of 5.61, which is below the industry average of 5.88 [12] Earnings Estimates - The Zacks Consensus Estimate for Affirm's fiscal 2025 earnings suggests a 101.8% improvement from the previous year, with revenue growth projected at 37% year-over-year [14]