Affirm’s BNPL Plans Surge As Customer Count Doubles to 7.1 Million

The fast-growing buy now, pay later (BNPL) provider Affirm exceeded its own expectations Thursday (Sept. 9) as it delivered fiscal fourth-quarter results that showed continued uptake of its popular installment plan financing offers now being made at the point of sale, while its roster of active consumers nearly doubled over the past year.

For the three months ending June 30, Affirms top-line revenue came in at nearly $262 million, up 71% year on year, far outpacing the Street at about $225 million.

Guidance for the current quarter was also better than analysts had expected, providing a double dose of recalibration that saw its stock jump by almost 20 percent in extended trading.

The company’s guided revenue for the fiscal first quarter of 2022 now stands at $240 million to $250 million, which is higher than the Street at $233.9 million.

Drilling down into the earnings supplement offered by the company, Affirm said that active consumers grew by 97% to 7.1 million in the latest quarter. The growth rate marked an acceleration from Affirm’s year ago customer count of 3.1 million, which itself was up 77% over the previous fiscal year.

Transactions per active customer were 2.3 in the most recent period, gaining 8% year over year.

Gross merchandise value grew by more than 100% to $2.5 billion in the quarter.

Transaction data showed 71% of transactions were done at the point of sale; the remainder came across the Affirm website. Within the lending activity itself, 38% of GMV was done at 0% APR. Fashion was the most represented segment at 20% of GMV, with sporting goods and home goods each representing 18%.

There were 29,000 active merchants tallied in the latest period, representing 412% growth.

It’s important to note that the guidance does not assume any contribution from the recently announced partnership with Amazon.

Read Also: Amazon Moves into BNPL

During the conference call with analysts, CEO Max Levchin noted that in many cases, traditional credit cards had become equivalent to a “ball and chain” if users were unable to make payments. And amid the continued growth in BNPL, the company, according to management, is targeting GMV growth in the current fiscal year of more than 50%.

Chief Financial Officer Michael Linford noted that GMV growth was most apparent in the categories leveraged to reopen the economy. Roughly 29% of transactions, he said, originated from the firm’s owned and operated properties. Management said that credit quality remains strong, as provision for credit losses grew by just 14% compared to revenue growth of 71%.