Buy now, pay later (BNPL) provider Affirm said Thursday (Oct. 9) that it supports Google’s Agent Payments Protocol (AP2), an open, payment-agnostic protocol developed to support agent-led payments across platforms.By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions .Complete the form to unlock this article and enjoy unlimited free access to all ...

Consumers are relying more on card installments and BNPL to manage higher costs.The holiday shopping season is kicking into full gear, and this year tariffs are again shaping the economics of the checkout line. After months of shifting trade rules, merchants appear ready to navigate the turbulence without derailing demand.By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Po ...

Key insight: Fintechs are paying more attention to cross-border payments.Look forward: PayPal is bullish on payments opportunities in EMEA. What's at stake: Cash continues to dwindle in the U.K., due to accelerating digital wallet growth. Swift has formed a consortium to build a distributed ledger to support real-time international payments, as well as accommodate the rise of digital assets. The international messaging standards board is working with financial technology firm Consensys on a prototype for th ...

Core Insights - The U.S. IPO market experienced a resurgence with seven large-cap companies going public last week, raising over $4 billion, indicating a potential rebound after a prolonged downturn due to market disruptions [2][3]. Group 1: IPO Market Dynamics - The positive reception of newly listed companies was notable, with Figure Technology Solutions' shares increasing by 28% and Black Rock Coffee Bar's shares climbing by 38% [3]. - The IPO pipeline remains robust, with expectations that total U.S. IPO volumes will exceed last year's figures if the current market conditions persist [4]. Group 2: BNPL Sector Growth - Klarna's IPO was highlighted as the largest FinTech listing of 2025, marking a significant moment for the BNPL sector, which is becoming a central force in transforming retail, credit, and payments [4][5]. - BNPL has entered the mainstream, with 128 million American adults utilizing a pay-later product from alternative credit providers in the past year, indicating a shift in consumer behavior [5]. Group 3: Technological Innovations - Figure's successful IPO raised approximately $787 million, reflecting strong investor interest in companies adopting blockchain technologies for lending and asset settlement [6]. - The future of capital markets is seen as increasingly reliant on blockchain, with Figure advocating for its use as a preferred method for transactions [6].

Core Viewpoint - Visa Inc. shares have recently shown bearish sentiment, slipping below key technical thresholds, including the 50-day and 200-day simple moving averages (SMA) [1][7][22] Price Performance - Over the past three months, Visa's shares have declined by 9%, underperforming the industry decline of 5.2% and the S&P 500's gain of 9% [5][7] - In comparison, Mastercard has decreased by 1.7%, while American Express has increased by 8.5% [5] Technical Analysis - The SMA is a critical tool in technical analysis, indicating longer-term price trends and potential fading buying interest when a stock falls below both the 50 and 200-day SMAs [2][7] Competitive and Regulatory Pressures - Visa faces competition from retailer-driven stablecoin payment systems and regulatory challenges, including an antitrust lawsuit from the U.S. Department of Justice and potential legislative changes like the Credit Card Competition Act [8][9] - Legal battles in the U.K. regarding merchant fees also add to the uncertainty [9] Valuation Metrics - Visa's stock is trading at a forward price/earnings ratio of 26.49X, compared to the industry average of 21.74X, which may temper near-term upside [10][12] - Mastercard trades at a higher valuation of 31.88X, while American Express is lower at 19.29X [12] Long-Term Growth Prospects - Visa's strong network effects and cash flows support its infrastructure and innovation, positioning it well for long-term growth [15] - The company is expanding into emerging channels like buy now, pay later (BNPL) and digital wallets, enhancing its growth prospects [15][16] Financial Performance - In the fiscal third quarter, Visa generated $2.8 billion in revenues from value-added services, a 26% year-over-year increase in constant dollars [16] - Visa returned $6 billion to investors in the last quarter, including $4.8 billion in buybacks and $1.2 billion in dividends [18] Analyst Sentiment and Estimates - The Zacks Consensus Estimate for Visa's fiscal 2025 and 2026 EPS suggests year-over-year increases of 13.7% and 12.4%, respectively [19] - The consensus for fiscal 2025 and 2026 revenues indicates increases of 10.9% and 10.8% [19] Price Target and Market Outlook - Despite recent stock weakness, analysts maintain a positive outlook, with an average target price of $397, indicating a potential 15.4% upside from current levels [20][22]

Core Insights - Klarna's IPO priced at $40 per share, above the targeted range, leading to an initial valuation of approximately $15.1 billion, with shares peaking at around $57 on debut, marking a 15% gain from the IPO price [2][3] Company Performance - Klarna's offering generated about $1.37 billion from roughly 34.3 million shares, with $200 million coming from newly issued shares [3] - The IPO performance indicates a healthy market reception, despite being a significant drop from its previous private valuation peak of over $45 billion [8][9] Market Position - Klarna holds the largest market share in the U.S. BNPL space at 26.2%, followed by Afterpay at 21.9% and Affirm at 19.3% [5] - The user base skews younger, with nearly one in four active users aged 25-34, suggesting potential for long-term relationships and repeat usage [5] Industry Implications - Klarna's successful IPO may signal a renewed interest in embedded-finance plays, encouraging other FinTech firms to pursue public offerings [7][9] - The strong demand and oversubscription indicate that investors are willing to reward companies with scale and diversification in the financial services sector [8]

Core Insights - Affirm Holdings, Inc. has expanded its partnership with Stripe, becoming the first buy now, pay later (BNPL) provider integrated into Stripe Terminal, enhancing its presence in physical retail locations [1][9] - The integration allows customers to select Affirm at checkout, facilitating purchases from $35 to $30,000 with flexible repayment terms [2][3] - This partnership is significant as over 80% of retail spending occurs in physical stores, providing Affirm an opportunity to penetrate in-person transactions [3] Company Performance - Affirm's transaction volume surged 45.6% year over year to 31.3 million in the last reported quarter, indicating strong growth potential from the new partnership [4] - The stock has gained 27.6% year to date, outperforming the broader industry and the S&P 500 Index [7] - Affirm trades at a forward price-to-sales ratio of 6.23X, higher than the industry average of 5.84, reflecting a premium valuation [10] Industry Context - Competitors like PayPal and Block are also expanding their BNPL services, with PayPal's total payment volume growing 6% to $443.5 billion and Block's BNPL gross merchandise value increasing 17% year over year to $9.11 billion [5][6] - The Zacks Consensus Estimate for Affirm's fiscal 2025 earnings suggests a 103% improvement year over year, indicating strong future growth expectations [12]

Core Viewpoint - Affirm Holdings, Inc. has experienced significant stock volatility following its fiscal Q3 2025 earnings report, with a sharp decline in stock price due to disappointing fourth-quarter guidance, followed by a rebound after announcing a new partnership with World Market [1][2]. Financial Performance - Affirm reported fiscal Q3 2025 earnings of $0.01 per share, surpassing the Zacks Consensus Estimate of a loss of $0.09 and improving from a loss of $0.43 in the prior year [3]. - Revenue increased by 36% year-over-year to $783.1 million, aligning with the company's guidance range of $755–$785 million [3]. - Gross Merchandise Value (GMV) reached $8.6 billion, up 36% from the previous year, exceeding the Zacks Consensus Estimate of $8.1 billion [4]. - Transactions totaled 31.3 million, reflecting a 45.6% year-over-year increase, primarily driven by repeat customers [4]. Growth Prospects - The company anticipates Q4 revenue between $815-$845 million and GMV between $9.4-$9.7 billion, although this guidance fell short of Wall Street expectations [5]. - Repeat customer transactions accounted for 94% of total transactions in Q3, indicating strong brand loyalty and potential for more predictable revenue [6]. - Affirm is expanding internationally, with plans to enter Western Europe, starting with France, Germany, and the Netherlands, in partnership with Shopify [7]. Business Model and Innovations - Affirm's model benefits both merchants and consumers by reducing cart abandonment and offering flexible payment options, including 0% APR monthly installments, which rose 44% year-over-year and accounted for 13% of GMV [8]. - The company is investing in complementary financial products, such as debit solutions and business-to-business tools, to enhance customer relationships and usage frequency [9]. Earnings Estimates and Valuation - The Zacks Consensus Estimate suggests a 95.8% year-over-year improvement in fiscal 2025 earnings, with fiscal 2026 earnings expected to surge nearly 960% [10]. - Revenue projections for fiscal 2025 and 2026 are expected to grow by 36.9% and 23.3%, respectively [10]. - Affirm's stock has increased by 67% over the past year, outperforming the broader industry and the S&P 500 Index [11]. Competitive Landscape - Affirm is trading at a premium valuation of 4.47X forward 12-month sales, higher than its three-year median of 3.49X, while competitors PayPal and Block are trading at 2.09X and 1.39X, respectively [14]. - The BNPL market remains competitive, with traditional financial institutions and credit card companies entering the space, exemplified by Walmart's switch from Affirm to Klarna [18]. Conclusion - Affirm's fiscal Q3 performance showcased strong revenue growth and rising transaction volumes, particularly from loyal customers, alongside an expanding merchant network and international market push [19]. - However, challenges such as elevated debt levels, rising expenses, and intense competition may impact margin stability and market share expansion [19].

Core Insights - Upstart Holdings and Affirm Holdings are prominent players in the fintech industry, leveraging artificial intelligence to transform traditional lending practices [1][2] - Upstart focuses on AI-driven personal loans, while Affirm is recognized for its "buy now, pay later" (BNPL) model, with differing financials and future outlooks [2] Upstart Holdings - Upstart has created an AI-based underwriting platform that surpasses traditional FICO scoring by incorporating alternative variables such as education and employment history, allowing for 92% loan automation by Q1 2025 [3] - The company is experiencing growth not only in personal loans but also in auto loans, HELOCs, and small-dollar loans, with auto loan originations increasing by 42%, HELOCs by 52%, and small-dollar loans by 7% sequentially in Q1 2025 [4] - Financially, Upstart reported a 67% year-over-year revenue increase in Q1, with non-GAAP EPS turning from a loss of $0.31 to a profit of $0.30, and it anticipates 76% revenue growth in Q2 and 59% for the full year [5] - Upstart is strengthening its funding relationships, with institutional investors like Fortress Investment Group now funding over half of its originations, and it is shifting towards super-prime borrowers, who now account for 32% of personal loan originations [6] - Despite challenges such as high interest rates and a dip in contribution margin from 61% to 55%, Upstart's expanding product suite and improving credit performance position it as a resilient fintech player [7] Affirm Holdings - Affirm has established a strong BNPL brand, facilitating payment splitting at checkout through partnerships with major companies like Amazon and Shopify, and its AI platform allows for quick loan approvals [8] - The company has 21.9 million active users and 358,000 active merchants as of Q3 fiscal 2025, and is expanding into sectors like travel and home improvement while also moving towards broader banking services [9] - Affirm is pursuing international expansion, recently launching Shop Pay Installments in Canada and planning to enter the U.K., Australia, and Western Europe, although it faces competition from established players like Klarna and PayPal [10] - Financially, Affirm's Q3 fiscal 2025 revenues grew by 36% year-over-year, but this growth lags behind Upstart's performance, with a non-GAAP EPS of $0.01 compared to a loss of $0.43 in the previous year [11] - Management projects Q4 revenue growth between 23% and 28%, indicating a potential slowdown [12] EPS Estimate Trends - The Zacks Consensus Estimate for Affirm's fiscal 2025 indicates year-over-year growth of 36.9% for revenue and 95.8% for EPS, but the estimate revision trend has been volatile [13] - In contrast, Upstart's estimates imply a 58.8% revenue increase and an 830% EPS increase for 2025, with a steady upward revision trend reflecting predictable performance [14][15] Price Performance & Valuation - Both companies have experienced share price fluctuations in 2025, with Affirm shares down 11.8% year-to-date and Upstart down 14% [17] - Currently, both companies have similar forward price-to-sales ratios, with Affirm at 4.46 and Upstart at 4.52 [18] Conclusion - While Affirm has built a strong consumer brand and is diversifying its financial services, it remains heavily reliant on the competitive BNPL market, with uncertain profitability and slower growth [21] - Upstart, on the other hand, is executing across multiple high-growth verticals, demonstrating operational leverage and a path towards consistent profitability, making it a more attractive investment opportunity [22][23]