Wall Street

Affirm’s Stock Is Flying After The New Guidance

Affirm shares are increasing after announcing 71% growth in revenue and posting strong guidance

Affirm reported better-than-expected fiscal fourth-quarter results with upbeat expectations and revenue growth of 71%, sending the the stock to increase more than 20% in extended trading following the news.

During the fourth fiscal quarter, the company generated revenue of $261.8 million, easily topping analysts’ estimates of just 225 million, according to Refinitiv data, while losing nearly 48 cents per share, which is not comparable to estimates.

Affirm said it had about 7.1 million active consumers on its platform as of the fourth quarter, up from just 5.4 million active consumers during the previous quarter.

Affirm is one of the leaders in the burgeoning ‘Buy Now, Pay Later’ service that allows people to split their purchase payments into installments. Affirm, which was founded in 2013 by the co-founder of the payments giant PayPal Max Levchin, was first launched in January to start trading at $90.9 after it was listed at $49.

The company has provided upbeat guidance for the current quarter and expects revenue for the first fiscal quarter of 2022 to be in the $240-250 million range, topping analysts’ estimates of 233.9 million.

The massive revenue report comes after Affirm announced last month that it was collaborating with Amazon in the e-commerce giant’s first partnership with an installment payments company, as the partnership will allow Amazon customers in the US to bill purchases over $50 in smaller monthly instalments. Read More [Affirm shares rise after news of its partnership with Amazon].

Notably, Affirm emphasized that its full-year guidance and fiscal first quarter expectations do not take into account any potential contributions of its new partnership to overall merchandise volume or revenue, knowing that the partnership is still in testing with selected clients and will be rolled out more broadly in the coming months.

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