Yahoo Finance
Affirm Holdings (NASDAQ:AFRM) just delivered its most profitable quarter ever, and the stock still fell 4.26% anyway.
That gap between the numbers and the market's reaction is the story here.
On the earnings call held August 27, founder and CEO Max Levchin announced he's stepping back from day-to-day execution to chase the next generation of products, while the current business keeps compounding underneath him.
The Affirm Card is where the growth story lives now.
Card attach rate sits at 19% of active users, and those cardholders spend twice as much on Affirm's network as the average user, a sign the card is deepening engagement rather than just adding a new payment rail.
Fully 30% of Affirm Card transactions happened offline, which management flagged as a major opening into in-store point-of-sale.
Rewards run through merchant-funded 0% programs, delivering value management compared to 8% to 15% cash back, made possible by the Visa Flexible Credential, a technical setup that lets one credential toggle between funding sources.
On top of the card, Pay-in-X volume grew 41%, helped by a large merchant shifting its financing program to an evergreen Pay in 4 offering, and the Services vertical nearly doubled in volume year over year after two major platform integrations.
Affirm is still only at 10% of e-commerce merchants and 80 of the top 250 US e-commerce sites, which management framed as a wide-open runway rather than a ceiling.
Fiscal 2027 guidance calls for revenue less transaction costs of 4.2%, matching fiscal 2026, and the company plans to keep funding its loan book through non-consolidated ABS deals at the same pace as this year's two.
Underneath it all, roughly 100 million transaction requests get processed each quarter, letting the company adjust credit policy in real time.
Levchin also framed the leadership shuffle, promoting Michael Linford to President and Pat Suh to SVP and GM of Global Markets, as freeing him to work on products that "will only show up in fiscal '28, '29, and so on," including a bank partner platform called Affirm Edge with pilots slated for the second half of the year.
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