Affirm Holdings (AFRM) AI Stock Analysis

• Market Cap: $19.90B
• Dividend Yield: N/A
• Average Volume (3M): 4.26M
• Price to Earnings (P/E): 89.4
• Beta (1Y): 2.50
• Revenue Growth: 37.00%
• EPS Growth: N/A
• Country: US
• Employees: 2,006
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.23
• Shares Outstanding: 289,362,760
• 10 Day Avg. Volume: 4,886,035
• 30 Day Avg. Volume: 4,258,859
• PEG Ratio: -3.90
• Price to Book (P/B): 7.27
• Price to Sales (P/S): 6.92
• P/FCF Ratio: 37.10
• Enterprise Value/Market Cap: 1.33
• Enterprise Value/Revenue: 7.64
• Enterprise Value/Gross Profit: 11.30
• Enterprise Value/Ebitda: 28.80
• 1Y Price Target: $95.82
• Price Target Upside: 58.91% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 20
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: $65.00 ▲(7.79% Upside)

The score is driven primarily by improving financial performance (strong cash generation and a turn to positive profitability) and a supportive earnings outlook (raised margin guidance and the long-term Amazon extension). Offsetting these positives are a premium valuation (high P/E) and mixed-to-soft technical signals.

Positive Factors

Free Cash Flow Strength

Sustained 27.8% FCF growth and very strong operating cash flow coverage (16.75x) indicate durable internal funding for product investment, ABS execution and growth initiatives. Strong cash generation reduces reliance on dilutive equity or expensive funding over the medium term.

Profitability Turnaround

A return to positive net margins and a healthy 61.5% gross margin reflect improved unit economics and pricing, enabling reinvestment in customer acquisition and product development. Sustained profitability supports scalability and long-term viability of the BNPL lending model.

Anchored Strategic Partnerships

A five-year Amazon extension materially secures distribution and sizeable GMV, improving revenue visibility and merchant reach. Long-term platform deals and partnerships (e.g., Fiserv, Bolt) strengthen competitive positioning and reduce customer acquisition friction over multiple years.

Negative Factors

Take-Rate Pressure / RLTC Variability

RLTC persistently above target signals potential reliance on higher take rates or provision tailwinds to hit revenue goals. If management trims RLTC to philosophy, revenue per unit could fall; conversely, sustaining higher RLTC risks merchant pushback and long-term competitiveness.

Balance Sheet & Historical Leverage Risk

While current leverage is manageable, the firm’s history of higher leverage creates structural funding sensitivity. Credit losses or ABS market stress could quickly strain capital; bank charter attempts to improve funding but approval and transition risks remain.

Credit Quality & Regulatory Scrutiny

The core BNPL lending model targets underbanked or near-prime consumers, exposing Affirm to cyclical credit risk. Persistent concerns and rising political/regulatory scrutiny of high-cost consumer credit could force tighter underwriting, higher capital costs or product restrictions over the medium term.

Affirm Holdings Business Overview & Revenue Model

Company Description

Affirm Holdings, Inc. operates a platform for digital and mobile-first commerce in the United States and Canada. The company's platform includes point-of-sale payment solution for consumers, merchant commerce solutions, and a consumer-focused app. Its payments network and partnership with an originating bank, enables consumers to pay for a purchase over time with terms ranging from one to forty-eight months. As of June 30, 2021, the company had approximately 29,000 merchants integrated on its platform covering small businesses, large enterprises, direct-to-consumer brands, brick-and-mortar stores, and companies. Its merchants represent a range of industries, including sporting goods and outdoors, furniture and homewares, travel, apparel, accessories, consumer electronics, and jewelry. The company was founded in 2012 and is headquartered in San Francisco, California.

How the Company Makes Money

Affirm generates revenue primarily through merchant fees and consumer interest income. When consumers use Affirm's payment solutions at partner merchants, Affirm charges these merchants a percentage of the transaction amount, typically ranging from 2% to 6%. Additionally, Affirm earns interest on loans provided to consumers when they choose to finance their purchases over time. The company offers different repayment plans, and the interest rates can vary based on creditworthiness and the terms of the loan. Significant partnerships with major retailers and e-commerce platforms enhance Affirm's market reach and drive transaction volume, further contributing to its revenue streams.

Affirm Holdings Financial Statement Overview

Summary

Improving fundamentals supported by strong free cash flow growth and very strong operating cash flow coverage of net income. Profitability has turned positive with a healthy gross margin, though operating efficiency still has room to improve and the balance sheet is only moderate with historical leverage risk.

Income Statement

Affirm Holdings shows a strong revenue growth trajectory with a 7.28% increase in TTM revenue. The company has improved its profitability, evidenced by a positive net profit margin of 8.39% in TTM, compared to previous losses. Gross profit margin remains healthy at 61.50%. However, the EBIT margin is relatively low at 17.32%, indicating room for operational efficiency improvements.

Balance Sheet

The balance sheet reflects a moderate debt-to-equity ratio of 0.34 in TTM, indicating manageable leverage. Return on equity has improved to 7.75%, showing better profitability. However, the equity ratio is not explicitly provided, and historical high leverage in previous years poses potential risk.

Cash Flow

Cash flow analysis reveals a robust free cash flow growth of 27.84% in TTM, with strong operating cash flow coverage of net income at 16.75 times. The free cash flow to net income ratio is healthy at 0.79, indicating efficient cash generation relative to profits.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.46B	3.22B	2.32B	1.59B	1.35B	870.46M
Gross Profit	2.34B	2.18B	1.48B	714.82M	772.84M	547.55M
EBITDA	917.82M	711.99M	-2.23M	-671.60M	-602.41M	-370.69M
Net Income	233.10M	52.19M	-517.76M	-985.35M	-707.42M	-441.03M
Balance Sheet
Total Assets	11.48B	11.15B	9.52B	8.16B	6.97B	4.87B
Cash, Cash Equivalents and Short-Term Investments	1.48B	2.23B	2.14B	2.07B	2.85B	1.48B
Total Debt	7.96B	7.85B	6.61B	5.45B	4.14B	1.98B
Total Liabilities	8.18B	8.09B	6.79B	5.62B	4.36B	2.29B
Stockholders Equity	3.30B	3.07B	2.73B	2.53B	2.62B	2.58B
Cash Flow
Free Cash Flow	769.21M	601.72M	290.84M	-108.59M	-273.90M	-213.38M
Operating Cash Flow	971.61M	793.91M	450.14M	12.18M	-162.19M	-193.13M
Investing Cash Flow	-647.68M	-1.08B	-1.33B	-1.65B	-2.01B	-1.02B
Financing Cash Flow	395.89M	751.42M	913.15M	1.35B	2.04B	2.58B

Affirm Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 60.30
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFRM, the sentiment is Negative. The current price of 60.3 is below the 20-day moving average (MA) of 73.41, below the 50-day MA of 71.66, and below the 200-day MA of 68.76, indicating a bearish trend. The MACD of -2.74 indicates Positive momentum. The RSI at 28.80 is Positive, neither overbought nor oversold. The STOCH value of 6.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AFRM.

Affirm Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
XYZ	75 Outperform	$36.72B	12.16	14.78%	―	0.47%	178.05%
FOUR	68 Neutral	$5.23B	27.72	15.52%	―	23.16%	27.38%
PAYO	67 Neutral	$2.28B	33.68	9.79%	―	10.58%	-45.52%
MQ	66 Neutral	$1.82B	-51.69	-4.10%	―	20.11%	-391.61%
AFRM	65 Neutral	$19.90B	89.36	7.60%	―	37.00%	―
KLAR	65 Neutral	$16.27B	-38.44	―	―	―	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Affirm Holdings Corporate Events

Affirm Grants New Performance-Based PSU Award to CEO

On January 13, 2026, Affirm Holdings’ board approved a new performance stock unit grant of 333,667 PSUs to founder and CEO Max Levchin under the company’s 2012 Stock Plan, structured to vest into Class A common shares based on a mix of time, service and three-year financial performance conditions. The award, aligned with PSU grants made to other executives in September 2025, ties potential share payouts—ranging from 50% to 200% of the granted units—to average performance from July 1, 2025 through the end of the three-year period on two equally weighted metrics: annual growth in revenue less transaction costs and adjusted operating income, with no shares earned until the performance period concludes and vesting contingent on Levchin’s continued service; the grant succeeds a prior value creation award that was established before Affirm’s IPO in January 2021 and expired on January 11, 2026, underscoring the company’s ongoing use of long-term, performance-based equity to align executive incentives with financial outcomes.

The most recent analyst rating on (AFRM) stock is a Hold with a $87.00 price target. To see the full list of analyst forecasts on Affirm Holdings stock, see the AFRM Stock Forecast page.

Affirm stockholders back board, auditors and executive pay

At its annual meeting of stockholders held on December 15, 2025, Affirm Holdings, Inc. reported a quorum representing 93.4% of combined voting power across its dual-class share structure, with Class A shares carrying one vote and Class B shares carrying fifteen votes but voting together as a single class on all matters. Stockholders elected Richard Galanti, Christa S. Quarles and Manolo Sánchez as Class II directors to serve until the 2028 annual meeting, ratified the appointment of Deloitte & Touche LLP as the company’s independent registered public accounting firm for the fiscal year ending June 30, 2026, and approved on a non-binding advisory basis the compensation of the company’s named executive officers, signaling broad shareholder support for the company’s current board composition, governance approach and executive pay practices.

The most recent analyst rating on (AFRM) stock is a Buy with a $95.00 price target. To see the full list of analyst forecasts on Affirm Holdings stock, see the AFRM Stock Forecast page.

Affirm Holdings Extends Partnership with Amazon

On November 6, 2025, Affirm, Inc., a subsidiary of Affirm Holdings, entered into a Second Amended and Restated Installment Financing Services Agreement with Amazon.com Services LLC and Amazon Payments, Inc. This agreement, effective February 1, 2026, extends their partnership for five years, allowing Affirm to continue offering installment loan products on Amazon.com and through Amazon Pay on third-party channels. Additionally, Affirm and Amazon Services amended a warrant agreement, maintaining the exercise price for shares based on new user acquisition before February 1, 2026, and setting a new price for acquisitions after that date. The agreement and amendment are expected to strengthen Affirm’s market position and expand its consumer base, reflecting its strategic focus on growth and profitability.

The most recent analyst rating on (AFRM) stock is a Hold with a $90.00 price target. To see the full list of analyst forecasts on Affirm Holdings stock, see the AFRM Stock Forecast page.