AFRM

ADP ADP is scheduled to release first-quarter fiscal 2027 results on Oct. 28, before market open. ADP has a decent earnings surprise history, surpassing the Zacks Consensus Estimate in the trailing four quarters, with an average surprise of 2.1%. Automatic Data Processing, Inc. price-eps-surprise | Automatic Data Processing, Inc. Quote The Zacks Consensus Estimate for the top line is set at $5.5 billion, indicating 5.6% year-over-year growth. The consensus estimate for the Employer Services (ES) segment revenues is pinned at $3.7 billion, indicating 5.3% year-over-year growth. The ES segment is expected to have benefited from solid business bookings, persistent demand for HR outsourcing solutions, and expansion across domestic and international markets. The segment is expected to have experienced significant growth from the growing adoption of ADP Lyric HCM, Global Payroll and WorkForce Suite. Additional support is expected from investments in AI-driven sales tools, prudent pricing contribution and healthy client retention. The Zacks Consensus Estimate for Professional Employer Organization services revenues is pegged at $1.8 billion, indicating a 5.8% year-over-year gain. Continued business bookings growth and an expanding worksite employee base are anticipated to have supported this segment's growth. Growth across the PEO segment is likely to have been further supported by enhanced customer satisfaction and stable retention. The consensus mark for Interest on Funds held for clients is at $332.3 million, suggesting 15.9% year-over-year growth. Higher average investment yields and expanding client fund balances are expected to have boosted this segment's revenue growth. The consensus estimate for earnings per share is set at $2.78, implying year-over-year growth of 11.7%. The bottom line is anticipated to have improved on the back of AI-driven operational efficiencies and service delivery cost strip-down. Our proven model does not conclusively predict an earnings beat for ADPthis time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can uncover the best stocks before they are reported with our Earnings ESP Filter. ADP has an Earnings ESP of 0.00% and a Zacks Rank of 2 at present. You can see the complete list of today's Zacks #1 Rank stocks here. Here are a few stocks from the broader Computer and Technology sector, which, according to our model, have the right combination of elements to beat on earnings this season. Affirm AFRM: The Zacks Consensus Estimate for the company's first-quarter fiscal 2027 revenues is pinned at $1.2 billion, indicating a 30% year-over-year jump. For earnings, the consensus mark is set at 35 cents per share, suggesting 52.2% year-over-year growth. The company beat the Zacks Consensus Estimate in the past four quarters, the average surprise being 379.4%. AFRM has an Earnings ESP of +11.03% and a Zacks Rank #2 at present. The company is scheduled to declare first-quarter fiscal 2027 results on Nov. 5. Amphenol APH: The Zacks Consensus Estimate for the company's third-quarter 2026 revenues is kept at $9.4 billion, implying 52.4% year-over-year growth. For earnings, the consensus mark is pinned at 73 cents per share, suggesting a 55.3% jump from that reported in the year-ago quarter. The company beat the Zacks Consensus Estimate in the past four quarters, with an average surprise of 11.8%. APH currently has an Earnings ESP of +1.72% and a Zacks Rank #2. The company is scheduled to declare third-quarter 2026 results on Oct. 28. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report Amphenol Corporation (APH) : Free Stock Analysis Report Affirm Holdings, Inc. (AFRM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Roper Technologies, Inc. ROP is scheduled to release third-quarter 2026 results on Oct. 22, before market open. The Zacks Consensus Estimate for Roper Technologies' third-quarter earnings has remained steady in the past 30 days. The company has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, with an average surprise of 1.9%. The consensus estimate for the company's revenues is pegged at $2.18 billion, indicating growth of 7.9% from the prior-year quarter's figure. The consensus estimate for adjusted earnings is pinned at $5.79 per share, indicating 12.7% growth from the year-ago quarter's number. Let's see how things have shaped up for Roper Technologies this earnings season. ROP's Application Software segment's third-quarter performance is expected to have benefited from strength across its Aderant, Deltek, Vertafore and CentralReach businesses. The growing adoption of SaaS solutions and continued GenAI innovation are likely to have been key catalysts to Aderant's business growth. The Deltek business is likely to have gained from the strong demand for SaaS solutions in the private sector. The Vertafore business is anticipated to have performed well, driven by excellent enterprise delivery capabilities to large customers in the market. Strength in the CentralReach business, driven by higher recurring revenues, is expected to have acted as a tailwind for the segment. For the third quarter, the Zacks Consensus Estimate for the Application Software segment's revenues is pegged at $1.24 billion, indicating a 6.9% increase from the year-ago reported number. Roper Technologies' Network Software segment is expected to have benefited from strong momentum across construction and freight match markets. Solid demand for AI takeoff solutions within the ConstructConnect business is likely to have driven the segment. Increased average revenue per user (ARPU), driven by an increase in the adoption of digital freight marketplace solutions, is likely to have supported the DAT business. Strength in SoftWriters and Subsplash businesses is also likely to have aided the segment. For the third quarter, the Zacks Consensus Estimate for the segment's revenues is pegged at $444 million, indicating a 7.5% rise on a year-over-year basis. The performance of the Technology Enabled Products segment is likely to have been driven by continued strength in medical products businesses, particularly precision measurement and airway management units. Solid momentum in the Verathon and NDI businesses, supported by strength across single-use BFlex & GlideScope offerings and cardiac, neurology & orthopedic precision measurement solutions, is likely to have been another tailwind. For the third quarter, the Zacks Consensus Estimate for the segment's revenues is pegged at $490 million, indicating a 10.6% increase from the year-ago reported number. ROP has remained focused on expanding its product offerings and market presence through buyouts, which is expected to have boosted its top line. In July 2025, Roper Technologies acquired Subsplash, a provider of cloud-based solutions. The inclusion of Subsplash's modern technology platform, strong recurring revenue base and software-led payments capability is expected to aid ROP's third-quarter results. However, rising operating costs, owing to higher costs related to the amortization of acquired assets, are expected to have affected the company's bottom line. Also, given Roper Technologies' extensive geographic presence, its operations are exposed to foreign exchange headwinds. A stronger U.S. dollar is likely to have hurt its overseas business. Roper Technologies, Inc. price-eps-surprise | Roper Technologies, Inc. Quote Our proven model predicts an earnings beat for ROP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here, as elaborated below. Earnings ESP: ROP has an Earnings ESP of +1.13% as the Most Accurate Estimate is pegged at $5.86 per share, which is higher than the Zacks Consensus Estimate of $5.79. You can uncover the best stocks before they're reported with our Earnings ESP Filter Zacks Rank: ROP currently carries a Zacks Rank of 2. You can see the complete list of today's Zacks #1 Rank stocks here. Here are three other companies, which according to our model, have the right combination of elements to post an earnings beat this season. Vertiv VRT has an Earnings ESP of +3.28% and a Zacks Rank of 3 at present. The company is slated to release third-quarter 2026 results on Oct. 28. Vertiv's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being a negative 12.6%. AMETEK, Inc. AME has an Earnings ESP of +2.12% and a Zacks Rank of 1 at present. The company is scheduled to release third-quarter 2026 results on Nov. 3. AMETEK's earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 4.9%. Affirm Holdings, Inc. AFRM has an Earnings ESP of +11.03% and a Zacks Rank of 2 at present. The company is slated to release first-quarter of fiscal 2027 (ended September 2026) results on Nov. 5. Affirm Holdings' earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 379.4%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Roper Technologies, Inc. (ROP) : Free Stock Analysis Report AMETEK, Inc. (AME) : Free Stock Analysis Report Vertiv Holdings Co. (VRT) : Free Stock Analysis Report Affirm Holdings, Inc. (AFRM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering Affirm Holdings (AFRM), which belongs to the Zacks Internet - Software industry. When looking at the last two reports, this operator of digital commerce platform has recorded a strong streak of surpassing earnings estimates. The company has topped estimates by 688.24%, on average, in the last two quarters. For the last reported quarter, Affirm Holdings came out with earnings of $4.62 per share versus the Zacks Consensus Estimate of $0.33 per share, representing a surprise of 1,300.00%. For the previous quarter, the company was expected to post earnings of $0.17 per share and it actually produced earnings of $0.3 per share, delivering a surprise of 76.47%. Thanks in part to this history, there has been a favorable change in earnings estimates for Affirm Holdings lately. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is a great indicator of an earnings beat, particularly when combined with its solid Zacks Rank. Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Affirm Holdings has an Earnings ESP of +11.03% at the moment, suggesting that analysts have grown bullish on its near-term earnings potential. When you combine this positive Earnings ESP with the stock's Zacks Rank #3 (Hold), it shows that another beat is possibly around the corner. The company's next earnings report is expected to be released on November 5, 2026. With the Earnings ESP metric, it's important to note that a negative value reduces its predictive power; however, a negative Earnings ESP does not indicate an earnings miss. Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate. Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Affirm Holdings, Inc. (AFRM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Financial technology companies are set to report mixed quarterly results, with Visa (V) and Fiserv (FISV) expected to beat earnings estimates as Mastercard (MA) and PayPal (PYPL) report in-line financials, Oppenheimer said in a note Thursday. Visa will likely post fiscal fourth quarter non-GAAP earnings per share of $3.46 compared to consensus of $3.44 while Fiserv's EPS is expected to fall 16% year over year to $1.72, $0.01 above Wall Street's estimate, according to the note. The brokerage models Mastercard's and PayPal's non-GAAP EPS in line with analysts' expectations of $5.15 and $1.31, respectively. For Block (XYZ), Oppenheimer projects third-quarter gross profit to rise 20% year over year to $3.19 billion, above consensus of $3.15 billion. Corpay (CPAY) will likely post EPS of $7.26, beating the Street estimate of $7.18. The firm expects Affirm (AFRM) to post diluted EPS of $0.33, missing analysts' estimate of $0.37. Global Payments (GPN) and Western Union's (WU) EPS will match consensus expectations, the note showed. "We continue to favor Visa, Mastercard, Block, Affirm, and Toast (TOST) given their strong competitive moats, exposure to secular growth trends, and attractive growth profiles," Oppenheimer analysts, including Rayna Kumar, said. Visa and Mastercard will outperform the revenue consensus driven by growth in volumes, while PayPal will miss Wall Street's projections due to a lower transaction take rate, Oppenheimer added. The brokerage models Visa's fiscal fourth-quarter revenue at $12.16 billion, above the Street's $12.09 billion estimate, and expects Mastercard's revenue to reach $9.61 billion, slightly exceeding consensus of $9.58 billion. Meanwhile, PayPal's third-quarter revenue is projected at $8.68 billion, below the $8.72 billion Street expectation. Additionally, Oppenheimer expects revenue for Fiserv and Fidelity National Information Services (FIS) to match Street consensus, while Shift4 Payments (FOUR) and Western Union (WU) are modeled to fall short of analysts' projections. The brokerage upgraded its rating on Global Payments' stock to outperform from perform with a $115 price target, citing a derisked 2026 earnings outlook, potential free cash flow acceleration in 2027, and stable consumer spending trends supporting mid-single-digit revenue growth. Oppenheimer downgraded its rating on Fiserv's shares to perform from outperform due to ongoing uncertainty around future sales and earnings growth. "Given the company's execution missteps and repeated estimate revisions over the past two years, we remain somewhat cautious on the degree of acceleration embedded in the outlook," the firm said.

- The firm lowered the price targets on SoFi Technologies, Affirm Holdings, Capital One Financial, Klarna, and Sezzle as part of a third-quarter earnings preview. - This year, the best-performing stock of the lot has been Sezzle, with shares gaining more than 77% since the start of 2026. - Apart from SEZL stock, Affirm is the only other company among its peers that has posted positive returns of 0.6% this year. Shares of consumer finance companies are in focus ahead of the third-quarter earnings season slated to begin next week. SoFi Technologies Inc. (SOFI), Affirm Holdings Inc. (AFRM), Capital One Financial Corp. (COF), Klarna Group PLC (KLAR) and Sezzle Inc. (SEZL) garnered attention on Wall Street after TD Cowen revised its price targets on the companies. See what 10M+ investors are talking about. Get the Stocktwits Daily Rip for what retail is watching right now, free to your inbox TD Cowen analyst Moshe Orenbuch lowered the price target on SoFi Technologies to $17.50 from $18 and maintained a 'Hold' rating on the shares, implying an upside of about 11% from its last close. According to The Fly, the firm said that it had adjusted targets in the consumer finance group as part of a third-quarter earnings preview. The analyst also revised the price target on Affirm to $110 from $124 and kept a 'Buy' rating on the shares, implying an upside of nearly 47% from its last close. On Capital One, the analyst revised its target to $242 from $253 with a 'Buy' rating on the shares, on Klarna to $16 from $18 with a 'Hold' rating on the shares, and on Sezzle, to $160 from $165 with a 'Buy' rating. Orenbuch named Capital One and Affirm among its top consumer finance picks. Tabulated below are the 12-month average price targets for the consumer finance firms SoFi Technologies, Affirm Holdings, Capital One Financial, Klarna, and Sezzle, according to data from Koyfin: Company Ticker | 12-Month Average Price Target | Upside/ Downside From Last Close SOFI | $20.33 | +29% AFRM | $98.66 | +31.75% COF | $257.19 | +31.34% KLAR | $19.54 | +47.46% SEZL | $167.17 | +48.14% This year, the best-performing stock of the lot has been Sezzle, with shares gaining more than 77% since the start of 2026. The Minneapolis, Minnesota-headquartered firm has surged amid growing profitability, upgraded financial guidance, and major funding updates. Apart from SEZL stock, Affirm is the only other company among its peers that has posted positive returns of 0.6% this year. The other firms on the list have posted negative returns in 2026. Meanwhile, the Financial Select Sector SPDR Fund (XLF) has slipped 0.18% this year. On Stocktwits, retail sentiment around SOFI stock improved from 'bearish' to 'neutral' over 24 hours. Meanwhile, sentiment around AFRM stock, COF stock, KLAR stock and SEZL stock was 'bearish' at the time of writing. The retail sentiment on XLF was 'extremely bullish' at the time of writing. For updates and corrections, email newsroom[at]stocktwits[dot]com. Aashika Suresh has no position in any of the stocks mentioned in this article. StockTwits' news team content is for informational purposes only and is not intended as investment advice. For more, see our editorial policy. This article was originally published on StockTwits. Related: - Broadcom, Oracle And SpaceX Tap Private Credit For AI Hardware: Report - CAPR Stock Rises Nearly 5% As Capricor Presents Heart Data For Deramiocel Ahead Of November FDA Decision - SK Hynix's Memory Division Reportedly Picks Banks For Its US IPO Next Year

- Current Price: $74.75 - Target Price (Mid): ~$136 - Street Target: ~$99 - Potential Total Return: ~82% - Annualized IRR: ~13.5% / year Affirm Holdings (AFRM:NASDAQ) closed at $74.75 on October 5, 2026, up 5.62% in a session when buy now, pay later stocks moved higher as a group; coverage cited sector strength and recent partnership news, not a same-day company announcement+Stock+Is+Up+Today). That leaves shares 0.43% above their $74.43 close on December 31, 2025, after a 48.79% peak-to-trough drop over the past year that bottomed on March 27. Underneath that flat line, the Affirm Card reaches only 19% of active consumers, according to Affirm's investor relations materials. CEO Max Levchin's September 8 remarks at a Goldman Sachs conference show what the company is building to widen that reach. Affirm Card ended fiscal Q4 (quarter ended June 30) with 5.2 million active cardholders out of 27.8 million active consumers, and Card gross merchandise volume (GMV), the value of purchases on it, grew 124% to $2.8 billion in the quarter. Cardholders spend roughly twice what the average customer does, and Levchin said "the active card base as big as it is, it's not even 10 million." Because merchants promote Affirm at checkout, he added, acquisition comes at "something that resembles zero CAC," meaning customer acquisition cost is close to nothing. The next layer comes from DT1, an internal lab Levchin now works with several times a week. Its largest project is brand-sponsored promotions, where a brand sold through a retailer funds a 0% APR loan; Levchin said 0% offers typically lift a merchant's basket size by something like 80% and conversion by about 25% on higher-ticket purchases. "It's now live enough where it's running hundreds of millions of dollars of volume," he said, a management description rather than a disclosed figure, and small next to more than $50 billion of fiscal 2026 GMV. He also described an unnamed DT1 product where consumer spend has reached $8,000, about double the cardholder level, though "it's not a huge group just yet." Credit is the constraint: 0% loans earn no consumer interest, and Levchin said the underwriting behind them "has almost no room for error." Since December 31, 2025, consensus fiscal 2027 revenue has risen 8% to $5.48 billion, as the number of contributing analysts grew from 26 to 32. Over the same period, the NTM P/E on normalized earnings fell from about 23x to about 20x, partly because the 12-month window rolled into a higher-earnings year. With the price nearly unchanged, each dollar of expected earnings now costs about 14% less, even as new merchants such as Crate & Barrel Holdings, which signed on September 29, keep arriving. - Current Price: $74.75 - Target Price (Mid): ~$136 - Potential Total Return: ~82% - Annualized IRR: ~13.5% / year TIKR's mid case, the balanced scenario, values Affirm at around $136 by June 30, 2031, an ~82% total return from $74.75, or about 13.5% a year over 4.7 years. For context, consensus calls for $6.84 billion of fiscal 2028 revenue and normalized net margins of around 25% in fiscal 2027 and 27% in fiscal 2028. Card attach rising past 19% and brand-sponsored deals reaching scale would support the mid case, while a credit turn in the 0% book could compress the multiple further. The TIKR model favors loading up over selling, provided credit holds, and the next check is Affirm's report for the quarter ended September 30 (fiscal Q1 results came out on November 6, 2025). Card attach above 19% would show the base widening, and Levchin said that once brand-sponsored promotions reach "the $1 billion scale," he would find a way to present them to investors. A slip in attach or rising credit costs would suggest the lower multiple was earned. TIKR lets you forecast the future price of any stock in less than a minute. Just enter a few assumptions into TIKR's valuation model and see what Affirm could be worth. Start from Wall Street consensus estimates, or adjust the inputs to reflect your own view of the business. It's free to use. Search 100K+ global stocks, global top investor holdings, and more with TIKR.

As the craze of earnings season draws to a close, here's a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at personal loan stocks, starting with Affirm (NASDAQ:AFRM). Personal loan providers offer unsecured credit for various consumer needs. The sector benefits from digital application processes, increasing consumer comfort with online financial services, and opportunities in underserved credit segments. Headwinds include credit risk management in unsecured lending, regulatory oversight of lending practices, and intense competition affecting margins from both traditional and fintech lenders. The 9 personal loan stocks we track reported a very strong Q2. As a group, revenues beat analysts' consensus estimates by 7.2% while next quarter's revenue guidance was 3.6% above. Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 15.3% since the latest earnings results. Founded by PayPal co-founder Max Levchin with a mission to create honest financial products, Affirm (NASDAQ:AFRM) provides a payment network that allows consumers to make purchases and pay for them over time with transparent, flexible installment loans. Affirm reported revenues of $1.17 billion, up 33% year on year. This print exceeded analysts' expectations by 5.2%. Overall, it was a stunning quarter for the company with a beat of analysts' EPS estimates and an impressive beat of analysts' EBITDA estimates. Investor expectations, however, were likely higher than Wall Street's published projections, leaving some wishing for even better results (analysts' consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 10.1% since reporting and currently trades at $69.65. We think Affirm is a good business, but is it a buy today? Read our full report here, it's free. With well over one hundred million customers across Brazil, Mexico, and Colombia through its viral member-get-member referral program, Nubank (NYSE:NU) is a digital banking platform that offers financial services including spending, saving, investing, borrowing, and protection products to millions of customers across Latin America. Nubank reported revenues of $5.88 billion, up 55.8% year on year, outperforming analysts' expectations by 29.8%. The business had an incredible quarter with a beat of analysts' EPS estimates. Nubank delivered the biggest analyst estimate beat among its peers. Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 11.3% since reporting. It currently trades at $12.36. Is now the time to buy Nubank? Access our full analysis of the earnings results here, it's free. Dating back to 1912 and formerly known as Springleaf, OneMain Holdings (NYSE:OMF) provides personal loans, auto financing, and credit cards to nonprime consumers who have limited access to traditional banking services. OneMain reported revenues of $1.29 billion, up 6.9% year on year, exceeding analysts' expectations by 1.4%. It was a satisfactory quarter as it also posted a narrow beat of analysts' net interest income estimates but a significant miss of analysts' EBITDA estimates. As expected, the stock is down 9.4% since the results and currently trades at $56.36. Read our full analysis of OneMain's results here. Starting as a student loan refinancing company founded by Stanford business school students in 2011, SoFi Technologies (NASDAQ:SOFI) operates a digital financial platform offering lending, banking, investing, and other financial services to help members borrow, save, spend, invest, and protect their money. SoFi reported revenues of $1.21 billion, up 40.5% year on year. This print surpassed analysts' expectations by 7.1%. It was an exceptional quarter as it also put up a solid beat of analysts' transaction volumes estimates and an impressive beat of analysts' EBITDA estimates. The stock is down 4.8% since reporting and currently trades at $15.94. Read our full, actionable report on SoFi here, it's free. Founded in 2016 as an alternative to traditional credit cards for younger shoppers, Sezzle (NASDAQ:SEZL) provides a payment platform that allows consumers to split purchases into four interest-free installments over six weeks at participating retailers. Sezzle reported revenues of $149.7 million, up 51.7% year on year. This result beat analysts' expectations by 9.8%. Overall, it was an exceptional quarter as it also recorded a solid beat of analysts' EBITDA estimates and a beat of analysts' EPS estimates. The stock is down 39.4% since reporting and currently trades at $108.25. Read our full, actionable report on Sezzle here, it's free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market's biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market's primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market's dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

AFRM fell 4% Monday as fast money unwound its post-earnings spike, despite Q4 GMV surging 36% and revenue rising 33% to $1.17 billion. AFRM's 36% GMV growth far outpaces peers like PYPL, but that growth premium drives outsized single-session volatility when fast money exits positions. Max Levchin cited inflation fueling demand, backed by fiscal 2027 guidance for GMV above $64 billion and adjusted operating margin above 30%. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Affirm didn't make the cut. Grab the names FREE today. Shares of Affirm Holdings (NASDAQ:AFRM) are unwinding a sharp post-earnings rally to open the week, handing back much of the gain built on Thursday's fiscal fourth-quarter report. The move is more about positioning than any fresh news out of the company, which announced nothing today. Affirm stock is down 4% to $74.51 in Monday morning trading, extending the drift lower that began in Friday's afternoon session. Meanwhile, the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is down 0.52% to $764.36, a soft session for the broad market that puts Affirm's decline in sharp relief. The context matters here. Affirm stock was up 4% year to date through Friday's close, a figure that masks a huge intraweek swing. Friday saw the stock rally to an 11-month high, climbing 13% at its peak before paring most of that gain into the close. Profit taking after a large prior run is the cleanest read. Affirm reported its fiscal fourth quarter Thursday, August 27, for the fiscal fourth quarter ended June 30, and the results beat on both revenue and volume. Affirm's revenue rose 33% to $1.17 billion, against a $1.11 billion analyst estimate, while gross merchandise volume, the total dollar value of transactions processed on the platform, rose 36% to $14.1 billion, against a $13.39 billion estimate. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Affirm didn't make the cut. Grab the names FREE today. Affirm's profitability inflected, as well. Adjusted operating income reached $353 million, a 30% adjusted operating margin, and GAAP operating income came in at $147 million, a 12.6% GAAP operating margin, up six percentage points from a year earlier. Active consumers grew 21% to 27.8 million, and transactions per active consumer rose 20% to 7. The card story continued to compound. The Affirm Card business reached 5.2 million active consumers, up 125% from the prior year. Affirm's credit quality also improved, with the 30-day delinquency rate on monthly installment loans, excluding Peloton and Pay in X loans, coming in at 2.5%, an improvement from the 2.7% to 2.8% range in each of the previous three quarters. The gap between the results and Monday's reaction is the useful observation. A 4% decline in Affirm shares against a broad market down 0.4% is a far larger move than the broad market explains, which points to positioning in the stock rather than to anything in the results or in the wider market. Friday's session tells the same story from the other side. Affirm shares spiked toward an 11-month high intraday before rolling over, a signal that fast money used the report to sell strength rather than to build new positions. With no company-specific catalyst today, the unwind is just extending that same pattern. CEO Max Levchin framed the demand backdrop on the call: "In times of inflation, we see more demand because folks are budgeting. They're more thoughtful about how they want to use the money, and we're there to help." Affirm's guidance backed that up. For fiscal 2027, the company guided to gross merchandise volume above $64 billion and an adjusted operating margin above 30.5%. Affirm sits in the installment-payments space alongside PayPal Holdings (NASDAQ:PYPL), though the two run very different growth profiles. Affirm printed 36% GMV growth in the quarter, a pace that puts it in a different bucket from the slower-growing large-cap payment platforms it's often compared against. That growth premium is exactly why single-session volatility runs so hot in Affirm shares. When a fintech name trades on multiples of forward revenue and forward operating income, small changes in positioning move the price far more than similar flows would move a mature payments stock. Monday's selling is consistent with fast-money profit taking rather than any change in the underlying franchise. Position sizing is crucial here. A name that can spike 13% and give it back inside two sessions carries more single-session volatility than Affirm's fundamentals suggest, so investors should consider keeping their position sizes moderate while the gap between the results and the share price stays unresolved. Traders should watch for signs of stabilization in Affirm shares near pre-earnings levels, along with any sell-side revisions catching up to Thursday's raised fiscal 2027 outlook. The read on today's move is technical rather than fundamental in nature. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Affirm didn't make the cut. Grab the names FREE today. Contact [email protected] for any questions or corrections.

Affirm Holdings, Inc. AFRM posted fourth-quarter fiscal 2026 earnings of $4.62 per share. The figure beat the Zacks Consensus Estimate of 33 cents by 1,300%. The metric rose from 20 cents a year ago. Revenues of $1.17 billion rose 33.0% year over year and surpassed the consensus mark of $1.11 billion by 5.4%. AFRM’s strong quarterly results were driven by robust Gross Merchandise Volume (“GMV”) growth, higher transactions, strong repeat customer engagement and increased interest income. Rapid growth in Affirm Card adoption and merchant activity also supported the performance. However, elevated operating expenses and higher provision for credit losses partly offset the gains. The bottom line also benefited significantly from a $1.45 billion income tax benefit related to the release of a valuation allowance on domestic deferred tax assets. Affirm Holdings, Inc. price-consensus-eps-surprise-chart | Affirm Holdings, Inc. Quote As of June 30, 2026, AFRM’s active merchants totaled 570,800, up 50% year over year. GMV increased 36% year over year to $14.1 billion. The figure also surpassed the Zacks Consensus Estimate of $13.4 billion. The metric gained from strong contributions from direct merchant point-of-sale integrations, wallet partnerships and direct-to-consumer offerings. Total transactions rallied 41.1% year over year to 52.9 million on the back of a significant surge in repeat customer transactions. The metric beat the consensus mark of 47.4 million. Active cardholders more than doubled to 5.2 million, lifting the card attach rate to about 19%. Servicing income of $46.1 million advanced 36% year over year and beat the consensus mark of $45.4 million. Interest income rose 35% year over year to $567.3 million and beat the Zacks Consensus Estimate of $542.3 million. Merchant network revenues improved 26.3% year over year to $302.4 million but missed the consensus mark of $306.1 million. The metric gained from growing GMV. Card network revenues amounted to $85.2 million, up 26.9% year over year, attributable to higher usage of Affirm Card and Affirm virtual cards. The metric beat the consensus mark of $75.9 million. Operating expenses increased 24.5% year over year to $1.02 billion. Provision for credit losses climbed 42.5% to $223.2 million, while technology and data analytics expenses rose 31% to $202.6 million. Higher infrastructure costs and amortization of internally developed software contributed to the increase in technology and data analytics expenses. Operating income improved to $147.3 million from $58.1 million, with operating margin expanding to 12.6% from 6.6%. Adjusted operating income increased 49% to $353.4 million, and adjusted operating margin improved to 30.3% from 27.0%. Affirm exited the fiscal fourth quarter with cash and cash equivalents of $1.6 billion, which increased from $1.4 billion as of fiscal 2025-end. Total assets of $15.8 billion rose from the fiscal 2025-end level of $11.2 billion. Funding debt totaled $3.3 billion compared with $1.6 billion at the end of fiscal 2025. Total stockholders’ equity was $5.5 billion, up from $3.1 billion at the end of fiscal 2025. AFRM generated $1.2 billion in net cash from operations for the 12 months ended June 30, 2026, compared with $793.9 million for the 12 months ended June 30, 2025. AFRM reported 2026 operating revenues of $4.3 billion, up from $3.2 billion a year ago. Full-year adjusted net income was $5.53 per share, up from 15 cents a year ago. For the first quarter of fiscal 2027, AFRM expects GMV of $13.7-$14.0 billion and revenues of $1.19-$1.22 billion. The company projects revenue less transaction costs of $575-$590 million, an adjusted operating margin of 28.0-30.0% and a GAAP operating margin of 11.5-13.5%. For fiscal 2027, management expects GMV of more than $64 billion. The company expects revenues to remain near 8.49% of GMV, the fiscal 2026 level. Adjusted and GAAP operating margins are projected to exceed 30.5% and 14.5%, respectively. Affirm Holdings currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Other payment space players like Mastercard Incorporated MA, Visa Inc. V) and American Express AXP have also reported their quarterly numbers. Here’s how they have performed: Mastercard reported second-quarter 2026 adjusted EPS of $5.04, which topped the Zacks Consensus Estimate by 5.7%. The bottom line improved 21.4% year over year. Net revenues advanced 14.1% year over year to $9.3 billion. The top line beat the consensus mark by 2.4%. Mastercard’s quarterly results benefited from strong cross-border volume growth, increased switched transactions and robust demand for value-added services. The upside was partly offset by higher payment network rebates from renewed deals and an escalating operating expense level. Visa delivered third-quarter fiscal 2026 adjusted earnings of $3.32 per share, which rose 11% year over year and beat the Zacks Consensus Estimate by 2.8%. Net revenues were $11.63 billion, rising 14% year over year. Visa’s quarterly results reflected resilient spending trends, higher cross-border volumes and solid network activity, including a 10% year-over-year increase in payments volume on a constant-dollar basis. The upside was partly offset by increased operating expenses. American Express reported second-quarter 2026 earnings per share of $4.53, which surpassed the Zacks Consensus Estimate by 2.7%. The bottom line advanced 11% year over year. Total revenues, net of interest expense, improved 10% year over year to $19.6 billion. AXP’s quarterly results were driven by increased Card Member spending, higher net interest income and improved card fee growth. However, the upside was partly offset by elevated operating expenses. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Affirm Holdings, Inc. (AFRM) : Free Stock Analysis Report Mastercard Incorporated (MA) : Free Stock Analysis Report Visa Inc. (V) : Free Stock Analysis Report American Express Company (AXP) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, Aug. 27, 2026 at 5:00 p.m. ET Founder and Chief Executive Officer - Max Levchin President - Michael Linford Chief Financial Officer - Rob O'Hare Head of Investor Relations - Zane Keller Operator: Good afternoon. Welcome to the Affirm Holdings Fourth Quarter Fiscal 2026 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded, and a replay of the call will be available on our Investor Relations website for a reasonable period of time after the call. I'd now like to turn the call over to Zane Keller, Head of Investor Relations. Thank you. You may begin. Zane Keller: Thank you, operator. Before we begin, I would like to remind everyone listening that today's call may contain forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties, including those set forth in our filings with the SEC, which are available on our Investor Relations website. Our actual results may differ materially from any forward-looking statements that we make today. These forward-looking statements speak only as of today, and the company does not assume any obligation or intent to update them, except as required by law. In addition, today's call may include non-GAAP financial measures. These measures should be considered as a supplement to and not a substitute for GAAP financial measures. For historical non-GAAP financial measures, reconciliations to the most directly comparable GAAP measures can be found in our earnings supplement slide deck, which is available on our IR website. Hosting today's call with me are Max Levchin, Affirm's Founder and Chief Executive Officer; Michael Linford, Affirm's President; and Rob O'Hare, Affirm's Chief Financial Officer. In line with our practice in prior quarters, we will begin with very brief opening remarks from Max before proceeding immediately into your questions. With that, I will turn it over to Max to get us started. Max Levchin: Thank you, Zane. As always, the performance as good as it is. I'll keep the prompt remarks brief. As you may have noticed, fiscal fourth quarter was our most profitable quarter ever, even without the tax allowance release. The company is thriving, and the core business is firing on all cylinders. I'm excited to announce that our veteran execs, Pat Suh and Michael Linford, are promoted to SVP, GM of Global Markets and President, respectively, setting us up for an even tighter execution and allowing me to get even deeper into developing our next generation of products and services. With that, happy to address your questions. Back to Zane. Zane Keller: Okay. Thank you, Max. Now let's get to your questions. Operator, please begin the Q&A session. Operator: [Operator Instructions] Our first question comes from the line of Adam Frisch with Evercore ISI. Adam Frisch: Congrats to you, Mike, on a well-deserved promotion. Max, at the Analyst Day, you said you're most excited about things you can't really talk about yet. If precedent holds on the initial guidance and how you ultimately will end the year, growth in fiscal '27 should again be terrific, but with investors focused on the sustainability of high growth rates, when should we expect to see some of these initiatives start to show up in future years? And do you believe that over the long-term, Affirm needs to or should offer consumers multiple financial products and services in addition to what you do today? Max Levchin: Thank you. It's a compound question. I'll go backwards. We already offer multiple products to consumers today. So the answer to, should we do that, we think is yes, otherwise we wouldn't have built all these other things. For the moment, the majority of our products are various expressions of offering credit, but not necessarily at the point of sale. It also comes, obviously, in the form of a card. We have an account. We have a version of our product that works for business purchases. So we've already spread into several other subcategories, including verticals that we address. Actually, there's a bunch of that in my note in as well. So we absolutely expect to continue expanding. In terms of when these things will show up, I think this is probably a question for our CFO and Michael in sort of how we set guidance. But the -- a big part of the expectations from this promotion that Michael got and my own focus is I plan to spend a lot more time working on things that will only show up in fiscal '28, '29, and so on. And so the numbers we're putting to the market today reflect our products that are working and growing and printing profits. Some of the crazier ideas from the future are in the future, and we try very hard not to overpromise and underdeliver. Adam Frisch: Okay. I think growth is in good hands with you taking that. Operator: Our next question comes from the line of Harry Bartlett with Rothschild. Harry Bartlett: I just wanted to touch on something you mentioned in your shareholder letter. Clearly, it is doing very well, but you said that you're really available at 80 of the top 250 e-commerce sites and 10% of e-commerce merchants. You're very well integrated with a lot of the major PSPs now and clearly very well known as a brand. So I guess the question is, what's the impediment for getting these remaining merchants to sign up? And how do you kind of bridge that gap to get there? Max Levchin: We don't think of it as an impediment. I think we have an exceptionally strong revenue team, and Wayne, that who runs it, is an exceptional executive and deserves every accolade. And so I expect his team to continue executing and signing each one of these merchants one by one, sometimes in bulk, but mostly one by one. I think the majority of the time for large merchants, these are long sales cycles that take a lot less convincing than ever before. People understand the value that we provide, and they are excited to see it added to their checkout. But many large enterprises that sell things online have complex and frequently outdated systems. A lot of times, adding a new major point-of-sale system requires them to do some major modifications. Sometimes it pushes them to do whatever work that they were postponing because they weren't planning on adding another one. So these are not things that flip in 1 quarter. But the reason I mentioned the numbers you quoted is because there's just an enormous amount of greenfield. We think our -- if anything, this is a sort of a notion of our sales team has a lot of work to do for probably quite a number of quarters, but no one should be taking a break or should you be thinking we're running out of the Internet or anything. Operator: Our next question comes from the line of Harshita Rawat with Bernstein. Harshita Rawat: I want to ask about in-store. As Affirm Card continues to scale and now you have the wallet partnerships, how can you scale in-store usage of Affirm where the opportunity is arguably much bigger, as you also alluded. I know there are unique friction points in terms of getting approvals, what happens when you get declined physically get them in store. So I know 30% of your Affirm Card transactions are offline, but it's still very small as a percentage of your overall GMV. So I would love to hear your thoughts on product planning. Max Levchin: I 100% agree. One of the things that the innovation team that I have now more time to run is working on is improving the in-store process. And most things, payments in general, are very rarely about uncovering some low-hanging fruit that was just already in the ground, you need to pick it up. It's primarily about polishing off unhappy paths: poor connectivity. How do you make sure your product works in a large store that's essentially a Faraday cage, you can't get connected to the Internet. How do you integrate with point-of-sale systems that don't know how to read QR codes, don't know how to read barcodes. It's kind of an endless long tail or not endless. There's a meaningful long tail of conditions that make approval or tender delivery or even handling things like card size adjustments in-store just that much harder than online. Online, you hit back on your browser and you correct whatever it is you need to correct. In store, you have to go back to -- the back of the queue to the cash register, which is annoying and people would rather not do that. So the bar for error is much lower, like you have to create a much better consumer experience. So we're excited to work on that. By no means that should imply that we are unexcited about e-commerce. We actually have a lot to do. Obviously, there's still 80% more e-commerce to go. But offline is a giant portion of the market and continues to be. And we have some really interesting ideas on how to make the experience not just uniquely better, but also uniquely Affirm. So maybe the best answer to your question is not quite going to preannounce anything here yet, but we expect to launch a few ideas that are uniquely Affirm specific, which through the lens of sort of product development, you can ask people to do more work to use your product if you're delivering disproportionate value. You can consider sort of Affirm online relative to credit cards. Credit cards are really easy. Just type in a number or you tap it offline and off you go. Affirm has to do a little bit more work to get approval to understand why you might get declined, but the value is there. You get this amazing 0% deal, you get no fees, you get no deferral. And so the work is a little bit more, but the value is tremendous. And so we're going to bring that same ethos of maybe the work is a little bit more, but the value is so much better than what you do with your traditional payment instrument offline. And we'll show something off in the coming quarters. Operator: Our next question comes from the line of Rob Wildhack with Autonomous Research. Robert Wildhack: I wanted to ask you about the U.K. It sounds like you're pleased with the progress to date. But could you just tell us more about the early receptivity from consumers and from merchants? And then I'm also curious if there's been any competitive response or changes from the incumbents there that you've seen? Any details there would be great. And congrats to Michael and to Pat on the new roles. Max Levchin: Pretty excited about the United Kingdom, seeing solid results. We just held our first executive dinner there a couple of nights ago where we met with some of the larger existing merchants there and got their first round of formal feedback and all that. And by all accounts, it was a love fest. So I think we're doing well in terms of creating new friends and early fans. The consumer uptake, I think we said it before, and it turned out to be true. There's a lot of love to be had when you don't try to make money by sneaking your business model into fine print and hiding things with fees and such, and we don't do any of those things. And sure enough, consumers love it. But retailers actually have a fresh appreciation for that because to date, there hasn't been a player in the market that would build the products the way we do. On the competitive response, and I don't want to be too loud here because I might wake someone up, but we're not seeing much to report on the matter, to be honest. I think for now, at least we're doing great in terms of feeling like our product is a unique play in the market. Operator: Our next question comes from the line of Will Nance with Goldman Sachs. William Nance: I wanted to ask just on the growth in interest-bearing this quarter. Obviously, very strong. I know you're calling out the 41% growth in Pay-in-X, but it's also great to see kind of the largest product almost keeping pace with that product. So just curious how you're thinking about overall product mix and then just more of a nuance there. Just wondering if like the shift to the promotional event, if that created any like mix dynamics that we should consider from the fourth to the first quarter? Max Levchin: Yes. Great question. I think it really comes down to mix within sort of the 2 largest centers of gravity within the product portfolio. So on the one hand, we have point of sale. We did actually see sort of an acceleration in 0% share within point-of-sale integrations. And I think some of that is due to the Big Nothing event, but just it's also been a push of ours in terms of what we're selling into merchants. And then really on the direct-to-consumer side, we actually see a much higher proportion of interest-bearing loans within that product set. So we're running sort of north of 80% interest-bearing on our direct-to-consumer products. And I think just with the continued growth and scaling of things like Affirm Card, it's really that, that's driving the sort of mix shift back towards interest-bearing a little bit. Operator: Our next question comes from the line of Dan Dolev with Mizuho Securities. Dan Dolev: Exceptionally, as you said, Max, ludicrous quarter. I like that one. I have a question about something you said at the Analyst Day. You said it gets easier to grow as you gain scale, but some of your competitors are not seeing that. So what are you doing right or maybe what are they doing wrong that makes you benefit from that virtue? And congrats again. Max Levchin: Thank you. I can only speak, I guess, to what we're doing right. I think we know exactly who we are. Like we have a very, very specific set of views on why we do what we do, why we prioritize certain things, why we won't do other things and not just what kind of products or what sort of structures we're willing to put in front of our customers and what we're not. But we are a network. Every decision we make at the product level, at the sales level, at the capital markets level, we ask ourselves, does this benefit every part of our network? Does this grow the consumer base? Does it give them a reason to spend more with us? Does it give them a reason to spend more with our customers, the merchants by adding a merchant, are we exposing our consumers to the merchants we want them exposed to and so on. And so we are constantly asking ourselves how can we create a virtuous cycle? How can we aid the virtuous cycle that we've created. If you have a network, eventually, you start seeing network effects. And network effects are very simply, it is expensive to leave because you're going to miss out on a large and growing body and it's dumb not to join because you are missing out on a large and growing body of business. So the larger we get, the more valuable the network becomes, the more activity that happens on the edges of the graph we're building and the more people, the more merchants want to join the graph. I think for most payment systems, if you sort of cast your eye across the last 50 years of -- and I've been building payment systems for almost that long, sadly, the ones that survive and thrive are the ones that are extremely focused on building a network almost at the expense of anything else. And by the way, if you are willing to stay focused and go long, you are rewarded with profitability, with pricing power, with sustainability of the business, sustainable growth. All of that comes in time if you're focused on building a network. And we have been from the very beginning. If you look through my letters, you'll find the word network probably the most commonly repeated now. And that's sort of the secret to the success so far, and we have no intention of changing that. I think a lot of the players in the space decide that the next shiny object is the thing that will create short-term value and whatever happens next happens next. We try to measure things not in quarters, but in years and hopefully decades. So the strategy has worked for us so far. We'll continue doing exactly that. Dan Dolev: Great. We agree. Congrats again. Operator: Our next question comes from the line of Jason Kupferberg with Wells Fargo. Jason Kupferberg: So everyone's been asking you guys for a while, are there any signs of consumer stress in the business? Any concerning signals in your data on delinquencies? The answer has consistently been no. We see another strong quarter here. The consumer is really resilient. Is there a case to be made that you guys could actually loosen the credit box a little bit? Or does that feel too risky in light of some of the macro uncertainty out there? And then just a quick one for Rob. Any way you want us to think about modeling GAAP EPS for fiscal '27? Max Levchin: [indiscernible] you answer, and I'll think of something clever? Robert O'Hare: Sure. I mean I think we've given you a lot of the building blocks of GAAP EPS, Jason. We've given you GAAP operating income. We've also given you an estimate for share count. I think the one piece you're missing is the tax rate, and I'll probably go back to some of the guidance that we gave at the Investor Forum in May. We think on sort of a run rate basis, the GAAP tax rate lands in sort of the mid- to high 20% range. I would just caution though that there can be some volatility in the effective tax rate just based on some of the GAAP versus tax differences and how things like stock-based compensation and some other forms of share remuneration treated. So there's likely to be a bit of volatility, especially as we're continuing to scale profitability. So that's one of the reasons we stopped short of giving an exact guide for EPS. It's just the volatility that we think may play out in the tax rate. Max Levchin: Yes. And on the credit side, sort of a couple of thoughts that are sort of disconnected. We're not so big that you can look at Affirm and read the tea leaves of the overall macroeconomic state of the United States. Our consumer is doing fine. You can see that in the numbers. And we are benefiting tremendously from the ability to say yes and no to every transaction. So we are literally choosing the loans we want to make in real time in very small increments, roughly 100 million times a quarter. So highly differentiable curve, and we decide the shape in the area under. So in the sense of control of our credit outcomes, I said it before, I'll say it again 1,000 times, we are in control of the credit reality. You would see us slow down growth before you would see us have a real credit disturbance. And obviously, these are imprecise sciences. So there are always ups and downs in the DQs. But generally speaking, we manage to a number in the sense that credit target is the input, not the output of the business. The output is the approval rates and things like that. And so with that, we definitely have conversations around what's the overall policy stance. Are we feeling good about the future? Are we feeling less good about the future? Should we tighten, should we loosen? But it's never expressed in terms of some giant lever somewhere that Rob Finnegan grabs on to with both hands and opens up the floodgates of money or closes down. It doesn't work like that at all. There's a constant conversation happening in the credit team asking themselves, are there opportunities for strategically more permissive stance at a class of transactions or a class of consumers at a class of merchants. And those conversations happen all the time on a weekly basis, just like the credit team reports back to the management team on a weekly basis of exactly what the landscape looks like. At any given moment, you could hear them say, you know what, here's what's going on. An interesting standout is this. And this could be anything like we're seeing an early signal in DQ0 or DQ1. So day after the payments are due or 2 days after the payments are due, we're wondering what that is. We're going to monitor it for the next 6 weeks and make a decision. And so all this flavor is to give you a sense of we just really do not think about credit as this binary switch that gets flipped on or off. We never scramble to or away from it in part because we have so much control in part because we have an extremely serious point of view on what these numbers have to be for us to be a responsible and reliable counterparty to our capital markets partners. And so that is the most important relationship in the business on the supply side, and we have to maintain it. And so I am sure somewhere right now -- I hope they're not listening to me rant, but instead of doing their job in credit, but someone in the credit analytics team is putting together a scenario analysis showing how a merchant is getting slightly higher approval then what that does for our GMV and an alternative analysis showing how the merchant is getting a slightly lower approval and what that does for our GMV and consumer satisfaction. And so yes, the work is done constantly. By the end of this call, a decision to loosen and a decision to tighten will be made and it will be executed in due notion by the end of it. Operator: Our next question comes from the line of James Faucette with Morgan Stanley. James Faucette: I want to touch on the increase in Pay-in-X and kind of the comments that were made in the letter -- shareholder letter about getting some increased participation from merchants there. Just wondering like how you think about being able to expand that program? And then at least more interestingly, perhaps to me is, is that a gateway to improving or expanding up into 0% promotions, et cetera, for those kind of merchants? Is it basically a test/proof point for them? Max Levchin: That's a great question. I'll start this time and Rob can speak to the exact Pay-in-X growth, which is pretty good this quarter. So kind of the most important things to understand is free use of money is valuable to all consumers. So you can sort of ask like what is Affirm for? And one version of the answer is it's for people trying to figure out how to fit a considered purchase, something that actually registers on their personal financial radar into their monthly outflows. So it's affordability, it's access to capital when they need it or access to credit when they need it. The kind of a baseline answer. A more sophisticated answer is there's always alternatives in that space. And so the question then becomes, well, what's the cost of money? What's the cost of it? And obviously, the cost is interest we charge and the best possible deal is, well, what if there was no interest at all? What if someone else paid your interest. And -- that is a really, really important function in part because that makes the product appealing across all credit spectrum. So you could argue that there's a natural point where you say, well, you know what, I have excess of cash. I just don't care. And if you're going to charge me interest, I'm going to pay cash and move on. I'm going to pay with my credit card and pay it off before the end of the month, so there's no interest at all. The second you enter a space of very low interest like demonstrably lower than your credit card APR or 0, which is everyone's favorite price, you end up in a place where even a super prime borrower would benefit from free use of money. And the longer term is the loan, the more obvious the benefit. So every one of these Pay-in-X type products, it's a version of access to money at no cost to the consumer, we're always looking for ways of funding those transactions by the hands of our partners because they are the primary beneficiaries of these transactions. So it extends from merchants to manufacturers, to brands, sometimes to marketing partners to platform partners. So there's plenty of people who are involved in a transaction that have a degree of margin and have a differing level of excitement to see that transaction go through. The most exciting ones are, of course, merchants because they're dealing with things like inventory management, they have discounts, they rather not make, but they do want to see inventory move. But there's also people in manufacturing and the original equipment manufacturers in particular, that have a predictable upgrade cycle that they're trying to stick to. And they will be very excited a year from launch to push their last year's innovations and the new ones can go forth. And so all of that adds up to ample opportunity to create more of these Pay-in-X and pay-over-time transactions with 0. And I particularly like the longer-term ones because that's where underwriting at 0% consumer interest is a really, really hard science. Like this is the kind of thing where if you screw it up a little bit, you'll make a lot of unprofitable transactions. Part of our longevity in the space and our competitive strength has been our ability to precisely price these things, both on the credit side and the profitability side, the capital markets lens. It's very, very hard to do write unless you're very good and very confident in both your underwriting and your control of your underwriting. So that's kind of why these transactions keep showing up. That's why we do things like the Big Nothing. That's why we do a lot of these promotions in various forms of Pay-in-X. That's why you see growth of various Pay-in-X tractions. And you should expect to continue to see more of these. They're all building a giant book of -- this is proof that you, your favorite the manufacturers, the retailers, all the participants should participate in these because even though they tap into your margin a little bit, they drive the kind of buyer that has a lot of choices, and this is their favorite choice. Robert O'Hare: Yes. And the only thing I would add to that, James, is just I think we really pride ourselves on the breadth of product offerings we can bring to a merchant that can be tailored to the basket of goods that they're selling. And in most cases, the products that we're offering to that merchant's consumers will be dynamic as you go up the basket size spectrum. And so I think what you saw play out this quarter was we had a large merchant that has a relatively low average order value compared to the rest of our network, and they decided to make Pay in 4 an evergreen part of their financing program, and that showed up in a bit of an acceleration in growth for Pay in 4. But we're pretty agnostic ourselves around whether it's a Pay in 4 offering or a 3-month 0% offering. We really want to make sure we put the right offer in front of the consumer that's going to do the right amount of cash flow smoothing for that consumer. And so it really is going to be merchant dependent. And I think our ability to customize those financing programs specific to the merchant is a real differentiator for us in the market. Operator: Our next question comes from the line of Connor Allen with JPMorgan. Connor Allen: I wanted to ask about the services vertical. It looks like volume in that category accelerated quite a bit, almost doubled year-over-year. So could you talk maybe just a little bit about services, what drove that acceleration? And then maybe how sustainable the premium growth is within that category? Max Levchin: Part of it is we signed this really large services platform or 2. And I gave an exceedingly long answer last time, so I promise I'll do a shorter one now. So we signed a couple of very large services platforms. They're doing well and growing. And yet this will inevitably come up at some point in this conversation. We're still very, very early in all of those platforms. The product needs to be adapted to the specific motions of those products and services. And we're pretty excited. Our best integrations are always the ones where we get to co-build with the people we are integrating, and we're knee-deep in building a bunch of really cool new stuff, specifically for the services platform. So no promises how long the 2x the speed is going to keep going, but I don't think we're even out of the first inning of that particular game. Operator: Our next question comes from the line of Bryan Keane with Citi. Bryan Keane: Congrats on the promotions, of course. I wanted to ask on Affirm Edge, Max, I think you said that could be a source of upside in the future. Any traction to highlight during the quarter? It looks like we have a couple of pilots now going to happen in the second half of the year. Maybe just how is that product resonating and the potential for it to be a needle mover in fiscal year '28. And then secondly, just Rob, on revenue less transaction costs. I know it always gets a lot of attention. We were talking, I think, 3.25% to 4%. The guidance, obviously, for fiscal year '27 is a little bit above that at 4.16%. Can you just talk about mix and maybe the drivers to be above the midterm guide there? Robert O'Hare: Sure. I'll take the second one first. Just in terms of the revenue less transaction cost outlook, I mean, really just with the execution that we've seen within the debt capital markets, we just -- we brought on a capital base that gives us a profile and a funding cost that we think should carry on through fiscal '27. And the other big assumptions are things like the mix of how we fund the business, and we expect the mix to stay pretty consistent with what we saw in fiscal '26. Loan product is the other sort of mix component that can drive revenue less transaction cost, take rates. We may start to skew slightly higher to interest-bearing, but it would be a very slight mix shift there. So just given the setup that we have, the other piece, of course, would be consumer credit, and we're not seeing anything in the business today that gives us pause or worry. So I think with sort of those building blocks coming into the year, that's what informed the outlook that we gave, which really is consistent take rates with what we experienced in fiscal '26. Max Levchin: Edge, banks move slowly. That's maybe not a very nice thing to say about our prospective partners, but they're deliberate. They have regulators. They need to make sure that what they launch is not just looks good and looks good to them and was good to us. It also has to look good to Federal Deposit Insurance Corporation and sometimes Office of Currency Controller and so on. So there's a fair number of people that have to okay and bless structures. That said, pretty excited. We're still building out parts of it. So a little bit of it is just like we have to build the rest of the technology. You're building a thing that you're hosting locally for a bank to log in and like fine-tune their financing programs. It's a thing we didn't do before, now we have to. So there's some work to be done in terms of the technical part of it, but majority of the stuff is built. We're very excited about the reception we're getting. I continue saying this sort of in various quarters. I think the second you see one, you should expect to see more like a bunch, but the first one is always going to feel like what if something goes wrong, how do I handle that? And so -- and we're very sensitive to that. And we know how to launch credit products, but it's not the same thing as launching it for others. So we will frankly take as long as it takes for us as long as we need to bring -- to handhold these first launches to market to be able to report excellent results and hopefully get everybody else excited, too. Operator: Our next question comes from the line of Matt O'Neill with Bank of America. Matthew O'Neill: Yes. Appreciate it. Max, I was curious, you laid out a pretty complete map of growth vectors this quarter. I didn't notice leasing or device upgrades on the list. You presumably looked at it given how much of your volume is high-ticket electronics, you push hard into 0% APR. I was hoping maybe you could just walk us through how you think about the economics of a lease versus an installment loan for the same purchase, what an originator might gain from that? And why you conclude it's not a strategy for Affirm either now or ever? Max Levchin: I host a breakout seminar on -- 45 minutes on deep dives in the economics and complexity of the leasing. There's a couple of different things going on in that domain. The notion of kind of a subscription to your device and an automatic upgrade to the latest and greatest on unpredictable cadence, it's actually a really good idea. It's been around for a little while. It certainly pops up in conversations and sort of attempted launches here and there over the last decade. So I don't think -- there's nothing too equival on -- with on that front. On the other side of the equation, ask your favorite financial services, financial institutions analysts, how they feel about lease-to-own and rent-to-own companies. And if it's an unedited context, you might hear some expletives. And so between those 2, there's a lot of complexity in leasing it doesn't usually happen on day 1. It happens on day 365 or whatever it is, 720 something when you find out that the thing you've been for the last couple of years, you don't actually own any of it. And we definitely care very much about the high-end device sales and scheduled upgrades and creating structures that help our retail partners, our manufacturing partners push their merchandise that way. So I think that's a very, very important task and we're certainly quite motivated to participate in that segment. We think there are better ways. We think we can offer something to the market that is a little bit less prone to the -- what the bleep happen here that happens a couple of years from launch of such things. And we'll have more to say on the matter in some reasonably predictable future. For now, I think we're all going to learn with some of the ones that have launched recently and certainly information to be had. But we tend to try to build things from first principles, and that's what we're going to try to do here, too. Operator: Our next question comes from the line of Andrew Bauch with BMO Capital Markets. Andrew Bauch: I wanted to ask about Affirm Money Account. I feel like it hasn't been discussed in some time. So could you please provide an update there? And then as we think about your list of priorities, are there any interplays to consider with Affirm Card as it pertains to Affirm Money Account? Meaning does Affirm Card serve as an on-ramp to Affirm Money Account similarly to overall active accounts serve as an on-ramp to Affirm Card? And what does that -- what could that ultimately look like? Max Levchin: That's a great question. For one, it's really important for us to have a first-party product that is the most beautiful version possible of a first-party debit card that speaks to a tightly integrated checking/savings account that works really well with the Affirm Card structure because that's literally what Edge is. So any time we go tell a bank, it's going to be amazing to look at these stats, but better have something that's real. So it happens that we have one of our own. I don't talk too much about it, but it's a great product. I happen to think it's the best way to use Affirm Card. Reveal too many reveals here, but it's something that my 0 to 1 team has full ownership of, and we're working quite hard on making it an exceptional product. It's really a great product. If you haven't connected your Affirm Card to your Affirm Money Account, you should definitely try that. But it has been iterated on and is looking better than ever, and it is the experience that Affirm Edge will offer to our bank partners on the issuing side, but there's even more to come. I'll bite my tongue on that one. But ask me again in a quarter. Operator: Our next question comes from Moshe Orenbuch with TD Cowen. Moshe Orenbuch: I wanted to follow-up on an earlier question on the Affirm Card. Given that you get much higher spending, I think you mentioned twice as much on the card versus a typical customer. But at the same time, in-store commerce is 3 or 4x and the card is still growing at a rapid pace. Could you talk a little bit about how you think or what the drivers are for its contribution to GMV? Like is it going to be more about the attach rate? Is it going to be more about the spending per card? And anything that you would share with us about things you're doing to kind of enhance both of those metrics? Max Levchin: Good question. I think the honest answer is both. And we care a lot about attach rates. I think we try not to be overly aggressive in pushing it because it is kind of the more sophisticated like you have to work your way to understanding why you want one of these products. So it's not another thing we hammer you with. But then again, we do see 2x the use. So we should obviously be hammering it, perhaps harder. And so anyway, attach rate is important. We're at 19% right now relative to actives. We will, I think, see an increase. That's a reasonably good guess. On the flip side, we love the idea of higher usage per consumer too, and we're working on that. To accomplish that, I think a key goal in managing a successful credit business is you have to remember that your job is to help someone spend money responsibly. Like it's not very difficult to convince someone to borrow money, especially if you're not particularly concerned with how they'll pay you back. And it's a much tougher job to convince them that to spend money with you is a better idea than through another product. So there's some degree of transparence that we need to engineer. We've been pretty successful at it, obviously, given the 2x number, and we're finding more ways to do so. One way to think about it or at least the way I speak to the team about it is we need to make sure that the Affirm Card isn't just the best card in the world. It's also the best way to use Affirm. So as you sort of cast your mind across various Affirm offerings, you should always come back to if I use the card, I will get even better blank. So you should expect us to launch features and products that are cards specific that make it more compelling, which in turn will help attach rates because we're obviously not going to keep it a secret to telling people, if you use the card, you'll get X and Y and Z, use just Affirm, maybe slightly less amazing. And definitely not going to nerve the Affirm at the point-of-sale experience, but we'll keep on finding interesting and exciting ways to reward card. And then there was another leg to the question I talk for too long, I forgot. I think that's probably -- those are definitely the important 2 dimensions. [indiscernible] without the card is still a very profitable product for us. It's not a trade down in terms of profitability. We're not going to make it different in terms of financing programs. You'll still get all the financing programs you get at the point of sale. We never want to be less for our merchant partners, but there are ways of making the card even more compelling. We'll work on that. Operator: Our next question comes from the line of Darrin Peller with Wolfe Research. Darrin Peller: Can you just give us a quick update? I mean, obviously, you're outperforming the majority of players in the market, factor in pretty much all of them. But when you think about the competitive landscape, how do you -- I mean, we've seen obviously a number of your peers doubling down on BNPL and some rolling out debit flex cards. So your debit flex card, is there a differentiation you see there? And just more broadly, anything in the market in general you're seeing changing as these competitors start to roll out more and more products also? Max Levchin: I can't say we spend a ton of time obsessing over our competitors. I think we are fairly fixated on ourselves. Selfish as that sound. Selfish as that sounds. I think the product that we have is really compelling. It is different. I still am not aware of any product out there that offer exactly what we do. I think the Visa Flexible Credential that we put together with them is a unique construct and has now been adopted by a couple of players, which is great. I'm excited to see more innovation come through the networks. And that's always a good thing. But the way we built our VFC card is quite unique. It connects to our accounts in a very specific way. And we're -- again, I'm not aware of anyone else who's quite replicated it perfectly. The other thing, like Rob mentioned, and I'll repeat it, one of the unique strengths of ours is we have a large collection of financing programs that we bring to bear for our merchants, but also for our consumers as they decide what fits their bill, their monthly exposure. And I think our card is still highly unique in just how wide the collection of offerings is and literally on every quarter has more and more of these truly unique 0% programs added to it. Like the rewards in the Affirm Card, people often ask us, what is the rewards program? Why is there not a 1% cashback or 2% cashback? And the honest answer is you're getting an extraordinarily more value in every transaction where the merchant is funding your 0s. That's effectively an 8%, 9%, 10%, 15% cash back. And so we wouldn't ever express it that way because that's not how it's understood, but it is the same price except you're paying no interest on it at all for sometimes up to 3 years. And that is definitely not -- has not been replicated by anyone, and I don't expect it to be easily replicable by anyone at all. Operator: Our next question comes from the line of Dan Perlin with RBC Capital Markets. Daniel Perlin: And congratulations on the quarter and obviously the promotions. I wanted to just touch on quickly the gain on sale revenues, which once again was really the strongest line item for growth. I know you have pretty balanced growth, but this one continues to stand out. But it also looks like it might be normalizing a bit. And so I'm just trying to think about the revenue mix expected around your '27 guide. And that's really just predicated off your road map, the product road map and maybe some international expansion, which it sounds like isn't going to be overly meaningful yet. But any kind of I guess, mix shifts that we need to be mindful of would be helpful. Max Levchin: I think the one thing that I would call out, and this has been true for several years, but it should play out similarly in fiscal '27 as well is just that we will have quarters where -- and Q4 is an example of this. We'll have quarters where when we do a nonconsolidated ABS deal like we did in the fourth quarter, we'll see a bit more gain on sale revenue in those quarters around. So we stopped sort of sharing an exact schedule of nonconsolidated ABS deals for fiscal '27, but I think we did 2 in fiscal '26, and we would expect to have a pretty similar funding plan from that perspective going into fiscal '27. Operator: Our next question comes from the line of John Hecht with Jefferies. John Hecht: Congrats on the promotions and Max and looking forward to the 2029 product launch. The question I have is... Max Levchin: Are you mocking the fact that it takes me 3 years to do anything good. Which is okay. John Hecht: I think, Max, you implied that you're now focused on the way out in the future opportunities. So... Max Levchin: That's mostly could prevent you guys from putting into a spreadsheet. John Hecht: Sorry, I don't anyway. The question I have is it's just sort of the maturation or seasoning of both your customers and your merchants. At the customer level, are you seeing things like a more rapid path to repeat usage at the merchant level? Or are you seeing more rapid pace to a certain level of penetration? Or are there tools that you guys can use to get there? Max Levchin: We're actually seeing really good results on both. And so a lot of it, it's sort of embarrassing. I'd love to take this great credit for like we discovered electricity and everything is faster now. Like we launched Crate & Barrel a few days ago, and then I saw an e-mail in my inbox telling me, "Hey, [indiscernible], are you Crate & Barrel customer because good news is you're an Affirm customer and Affirm now works is great." Like I think in the past, like 5 years ago, I'm not sure I would have gotten that e-mail. 2 years ago, I would have gotten that e-mail a month after the launch. And a year ago, I would have maybe gotten it in the same week. And now just like all those things are much tighter coordinated. There are machines, not people who are responsible for running through a checklist that happens. So the time from launch to meaningful impact to the first report to the merchant saying, "Horay, we're doing this for you. Let's get excited. Let's do more together." It just is a lot tighter. And so we're doing all those things. We're doing them better. So on the merchant side, we're just constantly improving the post-sales support, if you will. And on the consumer side, the best number I can point you to is transactions per user per year just steadily rises and -- we -- if anything, I raged our product team for not sending me enough e-mail or enough notifications or any form of telling me, hey, did you know that you haven't used Affirm in the last couple of weeks is I would welcome it. I'm not sure everybody else would. But we don't really do a whole lot of, hey, please come back. This sheer number of more surfaces where our logo is visible acts as a great reminder for consumers to say, "Oh yes, that was a great experience. I'll do it again." And cards obviously help, et cetera. But all in, the growth of transactions per user is actually a fairly natural phenomenon. And so we continue to just make sure that merchants sign a lot of merchants, we bring them live. We help them promote us. We co-market things together. We now have a very large user base that we can tell excitedly about brands that we love that we're excited to come into the fold. And that has a predictable effect where people say, yes, I'd love to use Affirm, Crate & Barrel. So I think both those things are happening fairly -- fairly organically. I'm sure we can do more, by the way. So I suspect we'll only accelerate from here. Operator: Our next question comes from the line of Timothy Chiodo with UBS. Timothy Chiodo: I want to talk a little bit about approval rates. I know earlier on the call, we were talking about how for credit loss, it's kind of a given number that you set. You can dial it up, you can dial it down. It's in your control. And the approval rate is sort of related to that at a given level of revenue or unit economics for that loan on the top line. The question that we get often from investors is around your approval rates relative to the other BNPL offerings that are out there. Clearly, they must be much stronger. But when the enterprise sales team goes in to meet with a new prospective merchant, what are they pitching in terms of how much better those approval rates are and how much more GMV they could deliver to that merchant? Max Levchin: I'm allowed to spread a slight amount of FUD, I will do so. We're definitely all compared on the approval rates. And merchants love to ask for guaranteed approval rates. And as a rule, we try very hard not to even talk about those things because that's always a counterweight to our ability to modify a credit policy on the fly as we must. The typical competitive bake-off often enough includes us launching a checkout experience as we would anywhere else and our esteemed competitors launching one where they remove underwriting and fraud prevention and demonstrating extraordinary approval rates only to then have to pull back very hard because you can only make so many bad loans for a while. And we tend to be very focused on our numbers and our losses. And I've said a million times, so I'm not going to dwell too much on it, but it's not enough to have great unit economics. We can obviously approve much deeper and just charge more interest and the profitability would be more or less the same, but anyone who's observing our credit results independent of the profitability would say, wait a second, like these guys are now going much deeper, maybe this isn't going to be as durable in a macroeconomic change reality. And so we tend to be very, very careful about not just the net result, but also the gross losses of the loan content itself. And so we pretty rarely ask ourselves how can we compete with approval rates. We -- all the time, like literally every single quarter ask ourselves, how can we refine our models, which -- if you want to imagine a credit model, it's a sorting function, a very, very sophisticated sorting function, but it looks at a large number of applicants on any given unit time and sorts them into least risky to most risky. And the job of the credit policy is to say, after this level of most risky, I don't want to approve anymore because that's the old risk I'm going to be able to sum it today. And so long as our sorting is as precise as the future reality or as close to future reality as we can possibly get it, that's what we must do. There's not really a shortcut where we say, what if we just approve deeper because the competitors might do so. If anything, we kind of want them to approve deeper than us because they are not as good as we are at sorting risk full stop. And so long as we are given enough time to compare and contrast, very quickly, you start realizing that what looked like a great approval rate on day 1 looks like a rug has been pulled and the approval rates are down and the losses are losses, of course, accumulate from the prior time period. [indiscernible] putting his head down because he's heard enough of this. I'll stop there. Operator: That concludes today's question-and-answer session. I'd like to pass it back over to management for closing remarks. Zane Keller: Great questions. Thank you all for joining the call today. I think we'll be seeing many of you on the conference circuit soon. So see you there. Have a good day. Thanks again. Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation. 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On August 28, Affirm Holdings (NASDAQ:AFRM) gave investors two very different signals in the same breath. The buy now, pay later company posted a fiscal fourth quarter that blew past Wall Street's numbers, yet CEO Max Levchin used the moment to flag something less comfortable: gas prices are squeezing the very shoppers driving that growth. The stock barely moved on the news, leaving the market to sort out which story matters more. The headline numbers were hard to argue with. Revenue rose 33% to $1.17 billion for the three months ended June 30, ahead of the $1.11 billion analysts expected, while gross merchandise volume climbed 36% to $14.1 billion against a $13.39 billion estimate. Adjusted operating income reached $353 million, a 30% margin, and the GAAP operating margin expanded six percentage points to 12.6%. For the full fiscal year, GMV hit $50.2 billion, up from $36.7 billion, on $4.26 billion in revenue. The user base kept expanding too. Active consumers grew 21% to 27.8 million, and transactions per active consumer rose 20% to 7.0, while the Affirm Card's active user count more than doubled to 5.2 million. Newly appointed president Michael Linford, who moved into the role Thursday, Aug. 27, after nearly two years as chief operating officer, called it the eleventh straight quarter of GMV growth above 30%. Credit quality held up alongside that growth, with the 30-day delinquency rate improving to 2.5% from the 2.7% to 2.8% range of the prior three quarters, something Compass Point's Giuliano Bologna called evidence of "resilient credit performance." Affirm also deepened its Shopify tie-up, extending Shop Pay Installments into Australia after last year's UK expansion, part of what Linford described as Shopify "pulling us into a new market" as both a partner and shareholder. Susquehanna's James Friedman raised his price target to $110 from $105, calling the guidance for fiscal 2027 "exceptionally strong." Levchin's own commentary complicated the celebration. "The US consumer undoubtedly sees the higher gas prices, so can't, can't ignore that," he told CNBC, noting shoppers are increasingly turning to Affirm to manage costs across "all the various inflationary points." The national average gas price sat at $4.09 a gallon as of August 28, down from above $4.50 in May but still well above pre-Iran war levels, and it hasn't dipped below $3 since March 2. Levchin was direct about the risk: "I do think that sustained pressure on prices isn't great in the long term, and so can't ignore that either." That pressure sits inside a broader inflation picture. The annual inflation rate stood at 3.7% in July, with the Fed's preferred gauge, the personal consumption expenditures index, up 0.2% for the month even as personal income and spending both grew. That leaves Fed Chairman Kevin Warsh weighing his next move at a September meeting. Meanwhile, not every analyst is fully on board with the stock. Morgan Stanley's James Faucette called Affirm "one of the best companies in our coverage" but kept his rating on the sidelines, arguing the valuation already looks "broadly in-line with peers on a growth-adjusted basis." Hedge fund ownership slipped from 61 funds to 57 in the most recent quarter, a modest pullback even as the business kept beating estimates. Short interest sits at 4.96% of the float, enough to suggest real skepticism without signaling a crowded bear trade. As of August 28, the stock's forward price-to-earnings ratio of 40.16 shows investors are still paying up for growth. That combination points to a market that likes the fundamentals but isn't chasing the stock aggressively. Affirm's quarter proved the growth engine is still running, with GMV, revenue, and user counts all outpacing expectations while credit quality actually improved. But Levchin's own words on gas prices and inflation are a reminder that the demand fueling that growth is tied to a consumer under some financial strain. For the bull case to keep playing out, that budgeting-driven demand needs to stay durable rather than turn into rising defaults. While we acknowledge the potential of AFRM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 10 Best Future Stocks to Buy Under $10 and 12 Best Performing Semiconductor Stocks to Invest In. Disclosure: None. Follow Insider Monkey on Google News.