Affirm’s Q3 2025 Earnings Call: Skyrocketing Growth, 0% Loans, and a Costco Deal That’s Turning Heads!
Affirm Holdings, Inc. (NASDAQ: AFRM) delivered a blockbuster third-quarter fiscal 2025 earnings call on May 8, 2025, showcasing robust growth, strategic partnerships, and a laser focus on profitability. The buy-now-pay-later giant reported revenue of $783 million, hitting analyst expectations, and an earnings per share of $0.01, beating estimates of a $0.03 loss. Gross merchandise volume (GMV) surged 36% year-over-year to $8.6 billion, exceeding forecasts of $8.2 billion, driven by strong consumer demand and partnerships with retail titans like Apple, Amazon, Shopify, and a new deal with Costco. The company’s adjusted operating margin improved to 22%, up 860 basis points from last year, reflecting disciplined unit economics. Affirm’s active consumer base grew to 22 million, with 2 million new users, and its Affirm Card saw GMV more than double, with active cardholders also doubling.
CEO Max Levchin emphasized the strategic value of 0% APR loans, stating, “Every time we sign someone new through a 0% promo, some number of months or quarters from now, that’s a prime candidate for the Affirm Card, and that’s a lifetime value booster.” These promotions, while generating lower revenue, attract high-value customers and maintain credit quality, with losses below 1% on core four-installment loans. Levchin also highlighted the company’s readiness for macroeconomic challenges, noting, “Our underwriting posture is largely unchanged,” ensuring stability amid potential risks. The Costco partnership was a standout, positioning Affirm to capture significant market share in high-ticket purchases.
Looking ahead, Affirm forecasted Q4 revenue of $815 million to $845 million, slightly below the $841 million expected, but GMV guidance of $9.4 billion to $9.7 billion topped estimates. The company reiterated its goal of achieving GAAP profitability by the end of fiscal 2025. Despite a cautious revenue outlook causing an 8% stock drop in extended trading, posts on X praised Affirm’s “excellent credit quality and LTV characteristics” and its ability to hit targets while expanding 0% APR programs. Levchin’s confidence in the holiday season and new partnerships signals Affirm’s momentum is far from slowing
