Affirm Reports Strong Revenue Growth

Affirm Holdings Inc. announced impressive financial results for the latest quarter, surpassing revenue expectations. As a result, the shares of the buy-now-pay-later operator experienced a surge in after-hours trading.

In the fiscal first quarter, Affirm recorded a net loss of $171.8 million, or 57 cents per share. This demonstrated a significant improvement compared to the loss of $251.3 million, or 86 cents per share, in the same quarter last year. The FactSet consensus had predicted a loss of 70 cents per share, making Affirm's performance even more noteworthy.

Meanwhile, Affirm's revenue spiked to $497 million from $362 million, outperforming the FactSet consensus of $444 million. When excluding transaction costs, the revenue amounted to $212 million, representing 3.8% of the gross merchandise volume.

The company confidently stated in its investor letter, "We believe the important takeaway from this quarter is that having done the hard work of adapting to interest-rate changes over the course of last year, we are prepared to grow our business at pace while managing credit in the higher-for-longer interest-rate environment."

Affirm also acknowledged a slight increase in delinquencies during the quarter, which subsequently normalized as the summer concluded. Consequently, its loss allowance increased accordingly.

Following the earnings report, Affirm's stock rose by over 7% in after-hours trading.

Affirm's gross merchandise volume achieved $5.6 billion, surpassing analysts' projections of $5.4 billion.

"We observed particularly strong demand at two of our enterprise platform partners," noted the company in a release. Additionally, Affirm experienced accelerated volume growth from its debit card and one-time virtual cards.

Looking ahead, Affirm anticipates revenue between $495 million to $520 million for the December quarter. Analysts had previously estimated revenue of $504 million.