Affirm Holdings, Inc. COO Michael Linford Discusses Strong Financial Performance and Strategic Initiatives at JPMorgan Global Technology, Media and Communications Conference
Key Takeaways
TL;DR: Affirm (AFRM) reported accelerating GMV growth (+36% YoY) and robust unit economics (+53% YoY), with a path to GAAP profitability by Q4 2025. Key drivers include 0% interest financing partnerships driving merchant wins (e.g., Costco), strong Affirm Card adoption, and a disciplined capital markets strategy. Near-term focus: scaling app engagement, expanding travel/airline verticals (UATP), and sustaining ~20% user/frequency growth.
1. Operational Metrics:
- GMV growth accelerated to +36% YoY (3rd consecutive Q), with rev. growth in line.
- Unit economics surged +53% YoY, surpassing the 3–4% LT target range.
- User base +20% YoY; transacting users’ frequency +20% YoY.
2. Profitability & Capital:
- On track for GAAP OP in Q4 2025.
- ABS markets “extremely constructive”: Recent deal oversubscribed, reflecting partner confidence in underwriting.
3. Consumer/Merchant Wins:
- 0% interest financing drives conversion (e.g., cycling merchant case study) with minimal margin trade-off (still above LT targets).
- Costco.com partnership (non-members eligible) seen as a brand validator; Walmart impact “small” (via 8-K).
- UATP integration: Entry into airline verticals (undisclosed US carrier).
4. Product/Card Focus:
- Affirm Card accounts for ~50% of active users, driving high-margin repeat engagement.
- App momentum: Majority of user journeys start here, with no paid ad integration to preserve user trust.
5. Competitive Landscape: