Consumer financing firm Affirm Holdings on Wednesday reported a smaller-than-expected loss in the March quarter while revenue and other financial metrics beat Wall Street targets. Guidance came in above expectations.
The San Francisco-based company reported fiscal third-quarter earnings before the market open.
Affirm Stock Reverses Down
On the stock market today, Affirm stock initially climbed mid-single digits after the earnings release. Shares reversed down after the company's earnings call with analysts. AFRM stock tumbled 9.5% to close at 31.58.
In the Affirm earnings report, the company reported a 43-cent per share loss for the three months ended March 31. That compared with a 86 cent per-share loss in the year-earlier period. Analysts polled by FactSet had projected a loss of 57 cents per share.
Affirm said revenue climbed 51% to $576 million vs. estimates of $496.5 million. Revenue minus transaction expenses came in at $$231 million vs. estimates of $217 million.
The company said gross merchandise volume rose 36% to $6.3 billion vs. estimates at $6.01 billion.
The new Affirm Card brought in $35.67 million in revenue, up 21%, versus estimates of $37 million.
Buy Now, Pay Later Leader Guides Up
For the current June quarter, Affirm said it expects revenue of $595 million at the midpoint of its outlook, topping estimates of $579 million. It forecast GMV of $6.85 billion, edging by estimates of $6.65 billion.
AFRM stock had retreated 27% in 2024 prior to the release of fiscal Q3 earnings. But AFRM stock has clawed back above its 50-day moving average.
Affirm is one of the biggest providers of buy now, pay later installment payment services. With BNPL options, consumers pay off purchases in monthly installments, either with low interest or none at all. Affirm also is expanding into other financial services.
The initial public offering for AFRM stock in January 2021 raised $1.2 billion. Affirm gets most of its revenue from transaction fees paid by online retailers. In addition, Affirm gets about one-third of its revenue from interest income paid by consumers.
AFRM stock skyrocketed in late 2023, but has retreated for most of 2024.
Heading into the Affirm earnings report, the stock had a Relative Strength Rating of 97 out of a best-possible 99, according to IBD Stock Check-up.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
