Affirm (AFRM) AFRM Q4 Financial Results Summary

# Affirm (AFRM) Q4 2025 Financial Results Summary

Released on August 28, 2025, Affirm’s Q4 2025 financial results showcased remarkable growth and operational improvements, reflecting its continued ability to thrive in a challenging economic environment.

## Key Metrics and Highlights

– **Gross Merchandise Volume (GMV)**:
– Reached **$10.4 billion**, representing a **43% increase** compared to Q4 2024.
– GMV driven by strong performances in the **top five merchants**, which collectively grew **41%**.
– GMV from **0% APR monthly installment loans** surged **93%**, facilitated by an increase in participating merchants, now over **25,000**.

– **Total Revenue**:
– Total revenue increased to **$876 million**, which is up **33%** year-over-year.
– As a percentage of GMV, total revenue declined to **8.5%**, down from **9.1%** a year prior.

– **Revenue Less Transaction Costs (RLTC)**:
– RLTC stood at **$425 million**, growing **37%** year-over-year.
– The RLTC as a percentage of GMV was **4.1%**, which is down **17 basis points** compared to the previous year.

– **Operating Income**:
– Affirm achieved an operating income of **$58 million**, contrasting with a **loss of $73 million** in Q4 2024.
– Operating margin improved to **7%**, up by **18 percentage points** year-over-year.

– **Adjusted Operating Income**:
– Increased by **$87 million** to **$237 million** compared to **$150 million** in Q4 2024.
– Adjusted operating margin reached **27%**, an increase of **4 percentage points** from the prior year.

– **Net Income**:
– Reported a net income of **$69 million**, compared to a net loss of **$45 million** in Q4 2024.

– **Active Consumers and Merchants**:
– **Active Consumers** rose by **24%** to **23 million**.
– The number of **active merchants** grew to **377,000**, representing a **24% increase** year-over-year.
– **Transaction frequency** supported a **20% increase** year-over-year.

– **Productivity Metrics**:
– Annual revenue per employee reached approximately **$1.5 million**.
– General productivity nearly doubled between FY23 and FY25, with a flat headcount.

– **Card Performance**:
– The Affirm Card experienced **132% growth** in GMV, reaching **$1.2 billion**.
– Active cardholders grew **97%** to **2.3 million**, with a card attach rate of **10%**, reflecting a **1-point sequential increase** from the previous quarter.
– In-store spend using the card grew significantly, with a **187% increase** noted.

## Capital and Share Repurchase

– **Funding Capacity**:
– Expanded to **$26.1 billion**, a notable increase from **$23.3 billion** at the end of Q3 2025.

– **Convertible Note Repurchase**:
– The board authorized a share repurchase program for up to **$200 million** in convertible notes, with **$174 million** remaining as of August 27, 2025.

## Financial Outlook

– Affirm expects GMV for fiscal Q1 2026 to range from **$10.10 billion to $10.40 billion**.
– Projected revenue is set between **$855 million to $885 million**, which is approximately **8.4% of GMV**.

## Conclusion

Affirm’s Q4 2025 financial results reflect a strong operational performance, with significant improvements in revenue, profitability, and consumer engagement. The company is strategically positioned for continued growth, focusing on expanding its merchant network and enhancing its product offerings.