Affirm Holdings Reports 47% Revenue Growth and Net Income Turnaround in Latest Quarter

Affirm Holdings, Inc. reported significant financial performance improvements in its latest 10-Q filing for the quarter ending December 31, 2024. The company generated total revenue of $866.4 million, a 47% increase from $591.1 million in the same quarter of the previous year. For the six months ending December 31, 2024, revenue reached $1.56 billion, up 44% from $1.09 billion in the prior year. The net income for the quarter was $80.4 million, a substantial recovery from a net loss of $166.9 million in the same period last year. This marks a notable turnaround, with the operating loss narrowing to $4.3 million from $172.2 million a year earlier.

The filing highlighted several strategic developments, including a focus on expanding its merchant network and enhancing consumer engagement. The number of active consumers increased by 19% year-over-year to approximately 21 million, while transactions per active consumer rose by 22% to an average of 5.3. The company also reported a 35% increase in Gross Merchandise Volume (GMV), reaching $10.1 billion for the quarter, driven by growth in its top five merchants and a diversified product offering. Affirm's merchant network revenue increased by 30% to $244.9 million, reflecting the company's successful partnerships and marketing strategies.

Operationally, Affirm has made strides in its loan origination and servicing model, with loans held for investment rising to $6.8 billion, a 30% increase from the previous year. The company directly originated $3.0 billion in loans during the first half of the fiscal year, maintaining a consistent share of its loan portfolio. The provision for credit losses also increased, reflecting the growth in loan volume, with the allowance for credit losses as a percentage of loans held for investment rising to 5.4%.

Looking ahead, Affirm's management expressed optimism about future growth, citing the potential for increased consumer adoption of its products and services. The company plans to continue leveraging its technology and data analytics capabilities to optimize its underwriting processes and enhance risk management. However, management acknowledged the ongoing challenges posed by macroeconomic conditions, including inflation and interest rate fluctuations, which could impact consumer spending and loan performance. Affirm remains committed to maintaining a diversified funding model to support its growth objectives and mitigate risks associated with market volatility.