Affirm's Q4 Earnings Exceed Expectations, Revenue Hits $876.4M

Affirm Holdings reported Q4 earnings of 20 cents per share, beating analyst estimates of 10 cents. Revenue was $876.4 million, topping estimates of $837 million. The company's merchant network expanded 24% to 377,000 active partners, and transaction frequency rose 20%. Credit performance was stable, with a 4% return on loans. Affirm expects Q1 revenue between $855 million and $885 million and fiscal 2026 revenue of $3.86 billion, well above analyst estimates.

Affirm Holdings, Inc. (AFRM) reported robust fourth-quarter (Q4) earnings, exceeding analyst expectations and signaling continued growth in the buy now, pay later (BNPL) sector. The company's stock has been performing well, rising over 12% following the announcement.

Key Financial Highlights

- Earnings per Share (EPS): Affirm reported EPS of $0.20, doubling the Street estimate of $0.10 [4].
- Revenue: Quarterly revenue reached $876.41 million, surpassing expectations of $837.02 million [4].
- Gross Merchandise Volume (GMV): GMV grew by 43% to $10.4 billion, driven by strength with its largest merchant partners, 0% APR monthly installment loans, and the direct-to-consumer business, including Affirm Card [1].
- Active Customers: The number of active customers increased by 24% to 23 million [2].
- Merchant Network: The merchant network expanded by 24% to 377,000 active partners [4].

Management Comments

Affirm CEO Max Levchin noted that the company achieved operating income profitability in the fourth quarter, aligning with the schedule committed to a year ago. He highlighted the company's focus on expanding its merchant network, increasing transaction frequency, and maintaining excellent credit performance [1].

Future Outlook

For the first quarter of 2026, Affirm expects revenue between $855 million and $885 million, with GMV projected to be between $10.10 billion and $10.40 billion. The company anticipates full-year fiscal 2026 gross merchandise volume to exceed $46 billion [1].

Analyst Reaction

JPMorgan analyst Reginald L. Smith reiterated an Overweight rating on Affirm and increased the price forecast from $91 to $94, citing strong growth, margin expansion, and a favorable credit quality mix [4].

Stock Performance

Affirm's stock has been trading at a new 52-week high, up 11.41% at $89.12 as of the publication date [4].

References:

[1] https://www.investopedia.com/affirm-stock-soars-as-bnpl-firms-fiscal-q4-results-easily-top-estimates-11800309
[2] https://www.ainvest.com/news/affirm-holdings-posts-q4-profit-q1-revenue-expectations-stock-rises-14-45-2508/
[3] https://www.nasdaq.com/articles/affirm-holdings-swings-profit-q4-expects-q1-revenue-below-view-stock
[4] https://www.benzinga.com/analyst-stock-ratings/reiteration/25/08/47420045/affirm-stock-jumps-as-analyst-highlights-record-spending-volumes-strong-credit-trends