How Investors May Respond To Affirm Holdings (AFRM) Return to Profitability and Strong Revenue Growth

• Affirm Holdings recently reported first-quarter earnings for the period ended September 30, 2025, highlighting US$933.34 million in revenue and a return to net profitability with net income of US$80.69 million, compared to a net loss a year earlier.
• The company's results featured surging growth in active merchants and gross merchandise value, with management also providing optimistic guidance for continued improvements in fiscal 2026.
• We'll examine how Affirm's shift from a net loss to net profitability, combined with strong merchant and GMV growth, influences its investment outlook.

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Affirm Holdings Investment Narrative Recap

To back Affirm Holdings as a shareholder, you have to believe that its rapid merchant expansion, surging gross merchandise value, and consistent product innovation will outweigh execution risks and potential revenue loss from departing enterprise partners. The company's return to net profitability this quarter and robust revenue growth are encouraging, but do not appear to have materially reduced the most important short-term risk: the possible near-term revenue drop if a major merchant partner fully offboards as previously anticipated.

Of the many recent company announcements, Affirm’s expanded partnership with Worldpay stands out for its direct link to the catalysts highlighted in earnings, the push for merchant adoption and embedded payment solutions. This integration could contribute to further GMV growth and reinforce Affirm’s position in the broader shift to flexible, digital-first payment experiences.

In contrast, the risk of losing a large merchant partner could test Affirm’s ability to deliver stable revenue that investors should be aware of if...

Read the full narrative on Affirm Holdings (it's free!)

Affirm Holdings is projected to achieve $6.0 billion in revenue and $756.6 million in earnings by 2028. This outlook assumes an annual revenue growth rate of 22.9% and a $704.4 million increase in earnings from the current level of $52.2 million.

Uncover how Affirm Holdings' forecasts yield a $96.14 fair value, a 36% upside to its current price.

Exploring Other Perspectives

Nineteen members of the Simply Wall St Community estimate Affirm’s fair value between US$25.09 and US$140 per share, showing sharply varied outlooks. Amid these diverse views, the company’s recent shift to net profitability after strong merchant growth highlights both upside potential and sensitivity to partnership risks.

Explore 19 other fair value estimates on Affirm Holdings - why the stock might be worth less than half the current price!

Build Your Own Affirm Holdings Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Affirm Holdings research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Affirm Holdings research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Affirm Holdings' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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