Affirm (AFRM) Stock Forecast & Price Target

Affirm Holdings Inc demonstrated significant growth in its business metrics, with Affirm Card Gross Merchandise Volume (GMV) increasing by 113% to $845 million in the second fiscal quarter of 2025, underscored by a 70% rise in 0% APR GMV. The company also reported a 42% year-over-year increase in interest revenue, which constituted 47% of total revenue, as it raised its fiscal year 2025 guidance to a GMV range of $34.74 billion to $35.34 billion and revenue expectations between $3.13 billion and $3.19 billion. Additionally, Affirm's active cardholder count expanded by approximately 20% quarter-over-quarter to 1.7 million, and a notable 138% year-over-year increase in revenue from loan sales indicated robust demand and effective pricing strategies.

Affirm Holdings Inc. faces a negative outlook primarily due to its operation in a highly competitive industry, where the potential loss of customers or merchant partners could hinder growth prospects. The company is also susceptible to poor loan performance and macroeconomic factors that may lead to increased credit losses and diminished demand from institutional investors, both of which negatively impact revenue and earnings per share growth. Additionally, the reliance on various funding sources poses a risk; any adverse changes in funding agreements or challenges in securing new sources could restrict Affirm's growth potential and profitability amid rising interest rates and declining consumer discretionary spending.