Earnings report exceeded expectations, Affirm’s stock price soared 32%, its best single-day gain in three years | Wilnesh News

confirm The company’s shares soared nearly 32% on Thursday, its best day in nearly three years, after revenue and profit from its buy-now-pay-later loan business exceeded expectations. earnings report.

This is the stock’s third-largest gain since the company’s IPO in January 2021.

Affirm said late Wednesday that fourth-quarter revenue increased 48% year-on-year to $659 million, and net loss narrowed to $45.1 million from $206 million in the same period last year. The company’s revenue exceeded expectations and its losses were smaller than expected.

Affirm expects revenue in the current quarter to be between $640 million and $670 million. Analysts polled by London Stock Exchange Group (LSEG) expected revenue of $625 million.

Affirm CEO Max Levchin said in a report to shareholders that the company has set a new goal to achieve operating profitability on a GAAP basis by the fourth quarter of fiscal 2025.

Analysts at Mizuho Bank called this a “killer quarter” for Affirm in a note Thursday and said “the prospect of positive GAAP operating income” would be “a significant milestone.”

Even after Thursday’s gains, Affirm shares are still down about 15% this year, while the Nasdaq is up 19%. But the stock has trended higher recently, rising 47% in August. Federal Reserve Chairman Jerome Powell said on Friday that a rate cut could come as soon as September.

Bank of America analysts said in a note last month that the rate cut would benefit Affirm’s financing costs and loan sales gains. The company raised the annual interest rate cap on its merchant loans to 36% from the previous 30%, which analysts said “should remain a driver of yield and GMV growth.”

Mizuho plans to launch new apple The Pay partnership could add $12 billion to Affirm’s total addressable market once it goes live later this year.

watch: Affirm the CEO’s views on consumer behavior