Affirm Stock Rises After Earnings Beat
Affirm stock rose after an earnings beat and higher margin guidance, with strong GMV and card growth prompting renewed investor buying and inflows.
KEY TAKEAWAYS
- Revenue was $933 million, beating estimates, while EPS reached $0.23 reversing a prior-year loss.
- GMV rose 42.0% to $10.8 billion, driven by Affirm Card growth and merchant adoption.
- Management raised FY2026 operating-margin guidance to greater than 7.5%, citing operating leverage from growth.
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Affirm Holdings Inc. (AFRM) reported fiscal first-quarter results on Nov. 6, 2025, for the period ended Sept. 30, 2025, that beat expectations and lifted Affirm stock after management raised its operating-margin target.
Quarter Results and Metrics
Affirm posted revenue of $933 million for the quarter, a 34.0% year-over-year increase that exceeded consensus estimates by 5.8%, according to a shareholder letter and an SEC Form 8-K. Earnings per share reached $0.23, more than double the consensus forecast of $0.11 and reversing a loss of $0.31 per share a year earlier. The company reported net income of $80.7 million and operating income of $64 million, turning a prior-year operating loss into profit.
Gross merchandise volume (GMV) rose 42.0% year-over-year to $10.8 billion, while revenue less transaction costs (RLTC) increased 60.0% to $455 million. Affirm’s card business showed rapid growth, with Affirm Card GMV surging 135.0% and active cardholders reaching 2.8 million. This growth was partly driven by merchant adoption of its buy now, pay later services at checkout.
Guidance and Strategic Partnerships
Management raised its fiscal 2026 operating-margin guidance to greater than 7.5%, up from a prior target above 6%, attributing the improvement to growth rather than cost cutting. CFO Rob O’Hare said on the earnings call that “a good portion of [incremental RLTC dollars] are flowing down to the operating income line.”
The company maintained its RLTC take-rate target of 4% for fiscal 2026, with a long-term range of 3–4%. It aims to reach 10 million active cardholders while expanding 0% APR offerings. Affirm extended its partnership with Amazon through January 2031 and broadened its Shopify arrangement in the U.K. The company is also expanding into new verticals, including service and automotive repair. The filings disclosed no material regulatory changes or compliance issues, and the press release did not include formal numeric guidance for the second quarter or full year.
