Levchin Says Affirm ‘Firing on All Pistons' as Active Card Users Surge 97%

Affirm reported robust financial results, with gross merchandise volume (GMV) surging 34% to $10.4 billion and revenues increasing 33% to $876 million, leading to a 14% after-hours share price jump. The company saw significant acceleration in its Affirm Card segment, with GMV up 132% and active cardholders nearly doubling, alongside a 24% rise in active consumers and merchants. CEO Max Levchin highlighted accelerating growth across all metrics, strong consumer momentum, successful conversion of 0% APR users to more profitable interest-bearing products, and robust credit performance, underscoring the strategic importance and future potential of the Affirm Card.

Analysis

Affirm Holdings (AFRM) reported a significant acceleration in growth for the June quarter, driving a 14% after-hours share price increase. The company's gross merchandise volume (GMV) surged 34% to $10.4 billion, while revenues grew 33% to $876 million, reflecting broad strength across its platform. The Affirm Card emerged as a primary growth catalyst, with its GMV expanding 132% to $1.2 billion and its active cardholder base nearly doubling to 2.3 million. This performance highlights a successful push into offline, in-store spending, which grew 187% year-over-year. Management commentary underscored the sustainability of this momentum, noting that 95% of transactions came from repeat borrowers and that users acquired through 0% APR offers are successfully converting to more profitable, interest-bearing products. This conversion is critical to the company's long-term unit economics. Furthermore, the CEO's assurance of strong credit performance, maintained through transaction-level underwriting, directly addresses a key investor concern in the buy-now-pay-later sector, while a 55% increase in funding capacity provides the foundation for continued expansion.

Key Decisions for Investors

• Given the accelerating top-line growth and highly optimistic management guidance, investors should view these results as strong validation of the company's execution and market positioning.
• Investors should closely monitor the Affirm Card's key performance indicators, including GMV growth and customer attach rate, as this product is central to the company's long-term expansion into offline, everyday spending.
• Pay close attention to future reports for continued evidence of strong credit performance and the successful conversion of 0% APR users to profitable interest-bearing products, as these factors are critical to validating the company's long-term unit economics and risk management.
• Following the 14% after-hours share price increase, it is prudent to assess whether the accelerated growth is fully priced in or if the fundamental strength warrants a higher valuation.