Key Takeaways
- Affirm shares surged 12% in premarket hours following fiscal Q2 2026 results that significantly exceeded Wall Street projections.
- The company posted revenue of $1.17 billion, marking a 33% increase from the prior year and surpassing analyst projections of $1.11 billion.
- Total gross merchandise volume (GMV) climbed to $14.1 billion, exceeding the consensus forecast of $13.4 billion.
- GAAP earnings per share reached $4.62, significantly outperforming the analyst consensus of $0.35.
- The buy now, pay later firm revealed a strategic partnership expansion with Shopify to introduce Shop Pay Installments in the Australian market.
Shares of Affirm (AFRM) skyrocketed 12% to $86.80 during Friday’s premarket session after the fintech platform reported fiscal second-quarter results that substantially exceeded analyst expectations on every key metric.
The company’s revenue for the quarter that concluded on June 30 totaled $1.17 billion, representing a 33% year-over-year increase and surpassing the Wall Street consensus of $1.11 billion. This represented a 5.2% outperformance versus expectations.
Gross merchandise volume, which measures the aggregate value of transactions flowing through Affirm’s network, increased 36% to reach $14.1 billion. The Street had anticipated $13.4 billion. Approximately half of this expansion stemmed from direct point-of-sale merchant integrations.
The company’s GAAP earnings per share came in at $4.62, vastly exceeding the analyst forecast of $0.35. Pre-tax profitability reached $169.1 million, translating to a 14.5% margin.
Michael Linford, who recently assumed the role of company president, characterized the performance as a “home run.” He emphasized that this marked the company’s 11th consecutive quarter posting GMV expansion above 30%.
GAAP operating margins expanded to 12.6%, climbing 6% compared to the year-ago period.
Forward Outlook Exceeds Projections
Looking ahead to Q3 calendar year 2026, Affirm provided revenue guidance of $1.21 billion at the midpoint, representing a 3.6% premium to the analyst consensus of $1.16 billion.
For the complete fiscal year, management anticipates GMV surpassing $64 billion, above the $63 billion Street estimate. CEO Max Levchin has consistently articulated a long-term objective of achieving $100 billion in GMV, a threshold analysts project will be reached by 2029.
Susquehanna’s James Friedman elevated his price target from $105 to $110 while maintaining a Positive rating, describing both the results and forward guidance as “exceptionally strong.”
Outperformance Versus Fintech Competitors
Affirm’s impressive quarterly performance provides a sharp contrast to the challenges facing other fintech companies. SoFi has declined 27% in 2026, while Klarna has tumbled nearly 52%. Affirm itself has posted a modest 4.1% gain year-to-date, underperforming broader market indices, though this report could shift investor sentiment.
Jefferies analyst John Hecht observed that fintech equities had already begun outpacing the S&P 500 in recent weeks ahead of earnings season, posting average gains of 6.7% compared to the index’s 3.2% advance.
Linford attributed the robust performance to healthy consumer financial conditions. When excluding Peloton and Pay in 4 loan products, Affirm’s 30-day delinquency rate increased 2.5% year-over-year, representing a slowdown from the 2.7% to 2.8% upticks observed during the previous three quarters.
The company also introduced a newly formed growth division under the leadership of Pat Suh, previously serving as SVP of revenue, to spearhead expansion into emerging markets.
Regarding strategic alliances, Affirm and Shopify jointly announced the debut of Shop Pay Installments in Australia. Shop Pay Installments has emerged as one of Shopify’s most widely adopted features in North America following its 2021 introduction.
Linford characterized the Australian market entry as Shopify driving Affirm into new territories, referencing a comparable UK market expansion the partners executed last year.
Over the past five years, Affirm has maintained an annualized revenue growth rate of 37.4%, with the most recent two-year period averaging 35.4% growth.
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