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Research Alert: Afrm Mar-q: Strong Growth Meets Expanding Profitability

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

AFRM delivered strong Mar-Q results, with diluted EPS of $0.30 vs. $0.01 prior year (beating consensus by $0.17) on revenue of $1.04B (+33%) vs. Street estimate of $995M. GMV reached $11.6B (+35%), marking the 10th consecutive quarter of 30%+ growth, while operating income surged to $88M from an $8M loss prior year. We believe the outperformance underscores AFRM's ability to scale efficiently while maintaining disciplined underwriting standards, with over 70% of RLTC dollar growth flowing to adjusted operating income. RLTC expanded 41% to $498M, representing 4.31% of GMV and exceeding management's 3%-4% long-term target range. The Affirm Card continued as a transformational catalyst with GMV surging 146% to $2.1B and active cardholders more than doubling to 4.4M, reinforcing its role in evolving AFRM from discrete checkout to primary spending tool. We expect the Card's momentum to drive network effects as in-store GMV remains more than an order of magnitude higher than non-Card surfaces.

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