"Affirm Holdings ( Nasdaq: AFRM) will report fiscal Q4 2025 earnings after the close. The buy-now, pay-later (BNPL) leader has been leaning into 0% APR financing campaigns, which CEO Max Levchin calls a "brand halo" that deepens merchant partnerships and expands card adoption. But the strategy has weighed on profitability - AFRM missed Q3 EPS by a wide margin despite record revenue."
"0% APR Promotions & Merchant Adoption- Merchants leaned heavily into 0% financing in Q3, boosting Affirm's GMV. Levchin emphasized it as Affirm's strongest card-acquisition channel despite thinner margins. Affirm Card Scaling- Card adoption continues to climb; 0% promotions bring in prime-quality users, strengthening Affirm's long-term LTV economics. Credit Quality & Funding Mix- Delinquencies remain low, with prepayments ticking higher - a positive credit signal. CFO Rob O'Hare highlighted Affirm's ability to quickly adjust underwriting in stress scenarios."
Affirm is set to report fiscal Q4 2025 results with Wall Street consensus calling for roughly $837 million in revenue and $0.43 normalized EPS, implying 27% year-over-year revenue growth and a swing to profitability. The company has pushed 0% APR financing campaigns that boost gross merchandise volume and accelerate Affirm Card adoption, while compressing margins and weighing on near-term profitability. March GMV showed about 40% year-over-year growth. Delinquencies remain low and prepayments have ticked higher, and management cites flexibility in underwriting and a shifting funding mix. Major merchant partnerships include Costco, Walmart, and Shopify, and shares have shown high post-earnings volatility.
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