Affirm Holdings reported fiscal fourth-quarter results that exceeded analyst expectations, with the company’s stock closing nearly unchanged on Friday. The fintech firm posted revenue of $1.17 billion, surpassing the consensus estimate of $1.11 billion. Gross merchandise volume reached $14.1 billion, substantially exceeding the StreetAccount projection of $13.39 billion. Looking ahead, the company issued first-quarter guidance of $1.19 billion to $1.22 billion in expected revenue, ahead of Wall Street’s anticipated $1.16 billion.
During an interview on CNBC’s “Squawk Box,” CEO Max Levchin addressed economic headwinds affecting consumer behavior. He pointed to elevated gasoline prices as a notable concern for shoppers, noting that the national average stood at $4.09 per gallon as of Friday. While this represented a decline from May levels above $4.50, prices remained significantly elevated compared to pre-conflict levels. The national average had last fallen below $3 on March 2.
Levchin observed that inflationary pressures are reshaping consumer spending patterns and driving increased demand for buy-now-pay-later services. He indicated that consumers are becoming more deliberate in their purchasing decisions and budgeting during inflationary periods, creating opportunities for Affirm’s payment solutions. The CEO acknowledged that while the broader consumer base demonstrates relative strength, sustained price pressures warrant caution regarding longer-term economic health.
Macroeconomic data presented a mixed picture. The annual inflation rate stood at 3.7% in July according to personal consumption expenditures data, which serves as the Federal Reserve’s preferred measurement tool. The PCE index increased 0.2% on a seasonally adjusted basis in July. However, other economic indicators showed resilience, with personal income rising 0.4% and spending increasing 0.2% in July, both exceeding analyst expectations. These developments are expected to influence the Federal Reserve’s policy deliberations at a September meeting.
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