Affirm stock up 30%: ‘higher rates have not been a real impact on cost’

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Affirm Holdings Inc (NASDAQ: AFRM) stock opened 30% up on Friday after the BNPL company reported strong results for its fiscal Q3 and raised guidance for the full financial year.

Key takeaways from Affirm Q3 earnings report

Lost 19 cents per share in the third quarter versus the year-ago figure of $1.23.Revenue popped up 54% on a year-over-year basis to $354.8 million.Gross merchandise volume in fiscal Q3 shot up 73% to $3.90 billion.FactSet consensus was for 46 cents of per-share loss on $344.3 million in revenue.Announced multi-year extension of its partnership with Shopify in the U.S.Active merchants increased from 12K to 207K and active consumers were up 137%.

Affirm is committed to hitting sustained adjusted operating income profitability on a run rate basis by the end of fiscal 2023, as per the earnings press release. The stock is now down roughly 75% for the year.

Future outlook and CEO’s remarks on CNBC’s Mad Money

For fiscal 2022, Affirm now forecasts its revenue to fall between $1.33 billion and $1.34 billion. The bottom end of this range matches experts’ forecast. The fintech expects up to $15.14 billion in GMV this year – well ahead of the FactSet consensus.

Affirms’ Q4 outlook for revenue was also roughly in line with analysts’ estimates. On CNBC’s Mad Money with Jim Cramer, CEO Max Levchin said:

Our cost of capital is still lower than 2019. So, the higher rates have not been a real impact on cost. Our delinquencies are also basically around the 2019 level. So, we feel great. We’ve added a billion dollar of new capacity in the last fiscal year.

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