Affirm Holdings punished on weak guidance

Affirm Holdings Inc (NASDAQ: AFRM) reported better-than-expected revenue for its fiscal fourth quarter on Thursday. Shares still tanked 15% after the bell on widened loss and weak guidance.

Notable figures in Affirm Q4 results

• Lost $186.4 million versus the year-ago $123.4 million
• Per-share loss climbed from 46 cents to 65 cents
• Revenue jumped 39% year-over-year to $364.1 million
• Consensus was 58 cents of loss on $354.6 million revenue
• Gross merchandise volume increased 77% to beat estimates

What did the CEO say?

Affirm ended the quarter with 14 million active consumers, up 96%. Active merchants grew sharply from 29,000 only to 235,000. In the earnings press release, CEO Max Levchin said:

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While the growth of online commerce is falling back to pre-COVID levels, the secular trend toward adopting honest financial products is gaining momentum. We remain focused on scaling our network, maintaining attractive unit economics, capturing greater share, and helping our partners grow.

Versus the start of 2022, Affirm shares are now down more than 70%.

Affirm Holdings’ future guidance

For the current financial quarter, the buy now pay later company forecasts up to $4.4 billion of GMV and $345 million to $365 million in revenue. In comparison, experts were at $4.55 billion and $386 million, respectively.

Affirm expects its gross merchandise volume to fall in the range of $20.5 billion to $22 billion this year on up to $1.725 billion in revenue. The full-year GMV outlook was better-than-expected but analysts had called for a higher $1.91 billion in revenue, though. CFO Michael Linford said:

In light of uncertain macro backdrop, we’re approaching our next fiscal year prudently while maintaining our focus on driving responsible growth and continuing to invest in strengthening our leadership position. We continue to expect to achieve sustained profitability run rate, on an adjusted operating income basis, by the end of fiscal 2023.