TenQ

The Affirm story

Affirm finances shoppers’ purchases at checkout, with expansion through merchant partnerships and Affirm Card testing whether more frequent use can sustain growth without weakening loan performance.

Written from Affirm's own filings with the SEC, and rewritten when it publishes a new earnings release. Updated 2026-09-30.

  • $67.21share price, last close
  • $22.7Bmarket value
  • 14/36TenQ Score checks passed

The story in brief

  • Repeat use defines expansion. Repeat consumers drove 96% of transactions in the fiscal year ended June 2026, while Affirm Card helps extend the business beyond merchant checkout integrations.
  • Growth has slowed. Revenue reached $4.3 billion over the last twelve months, growing 32.2% compared with an annual pace of 39.0% over the last three years.
  • Funding remains central. Affirm had $9.8 billion of total debt against $1.6 billion of cash and short-term investments, making funding access central to its lending model.

What drives the business

  • Affirm is expanding from checkout installment loans into more frequent online and store purchases through Affirm Card, its app, and its website, channels that initiated 25% of transactions in the fiscal year ended June 2026.
  • The company earns merchant fees and consumer interest, with interest-bearing monthly installment loans accounting for 70% of the $50.2 billion in gross merchandise volume facilitated in the fiscal year ended June 2026.
  • Its network included approximately 571 thousand active merchants at the end of June 2026, and transaction-level underwriting determines which purchases it finances and on what terms.
  • The release for the quarter to June 2026 highlighted new or expanded relationships with Walmart, Shopify, and Amazon, extending the partnerships that bring shoppers to Affirm.
  • Affirm funds lending through warehouse credit facilities, securitizations, and loan sale arrangements, and amended its revolving credit agreement in June 2026 with Barclays Bank PLC as administrative agent.

What the price assumes

The growth implied by the price is not measured because TenQ does not run a reverse DCF for companies filed under a finance industry code, where free cash flow may not measure earnings.

At $67.21, Affirm trades at 12.1x earnings and 5.3x revenue, alongside revenue growth of 32.2% over the last twelve months.

Its $993 million of free cash flow over the last twelve months represents a 4.4% yield, above TenQ's 3.0% cash-yield threshold, although the price-versus-growth check fails because there is no positive three-year earnings growth.

What could change the story

  • Revenue growth of 32.2% over the last twelve months trails both Affirm's 39.0% annual pace over the last three years and TenQ's sector growth benchmark of 34.4%.
  • Debt and funding costs constrain flexibility, with interest coverage of 0.92 against TenQ's 5.00 threshold.
  • The 45.3% net margin is substantially above the 9.8% operating margin, while TenQ's cash-conversion check falls short at 0.64 against 0.80, leaving the translation of reported profit into cash an important distinction.
  • Shares increased 18.1% over three years, and stock-based pay totaled $305 million over the last twelve months, making dilution a continuing claim on per-share growth.
  • Larger payment and lending competitors can have lower-cost funding and broader merchant relationships, while some merchants offer their own installment payment options alongside Affirm.

What to watch next

  • The release for the quarter to June 2026 gave no numerical guidance, leaving subsequent revenue and transaction figures to show whether expanded Walmart, Shopify, and Amazon partnerships accelerate growth.
  • Transaction frequency and direct-channel usage will help measure Affirm Card's progress, against approximately 7.0 transactions per active consumer at the end of June 2026 and the 25% share initiated through the app, website, and Affirm Card in the fiscal year ended June 2026.
  • Loan losses and the allowance deserve attention together: Affirm reserved 5.9% of loans held at the end of June 2026, compared with 9.2% at the end of June 2020.

Sources

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