Affirm Holdings Inc (NASDAQ:AFRM) reported fiscal second-quarter results that came in ahead of Wall Street forecasts and raised its outlook for gross merchandise volume and adjusted operating margins for the year. The stock was little changed in premarket trading.
The buy-now-pay-later firm posted adjusted earnings of $0.37 per share, beating the consensus estimate of $0.27 by a wide margin. Revenue reached $1.12 billion, exceeding expectations of $1.06 billion and rising 30% year over year. Despite the strong headline numbers, shares slipped in after-hours trading as provisions for credit losses increased to $214.2 million and losses tied to loan purchase commitments rose to $96.1 million.
Gross merchandise volume advanced 36% to $13.8 billion during the quarter. Operating income totaled $118 million, representing a $122 million improvement compared with the same period last year. Adjusted operating margin also strengthened, expanding by three percentage points to 30%.
“We delivered another round of excellent results in Affirm’s second quarter of FY’26,” said Max Levchin, CEO of Affirm. “What we learned this holiday season is that consumers are smart and, when it comes to finding alternatives to credit cards or other offerings with junk fees, they are getting smarter.”
For the third quarter, Affirm expects revenue in the range of $970 million to $1 billion, broadly in line with the Street consensus of $978.3 million. For the full 2026 fiscal year, the company now forecasts revenue of $4.086 billion to $4.146 billion, with the midpoint slightly above analyst expectations of $4.09 billion.
Affirm also raised its full-year GMV outlook to between $48.30 billion and $48.85 billion, up from its prior target of more than $47.5 billion and modestly ahead of the $48.3 billion consensus estimate. In addition, adjusted operating margin guidance for the year was lifted to a range of 27.4% to 28.1%, from a previous forecast of 27.1%.
Reacting to the results, Bank of America analysts led by Mihir Bhatia said Affirm shares “deserve better after strong 2Q results.”
“Overall, the quarter was solid, featuring a beat and raise,” he added, suggesting the muted market response may reflect that “investors likely wanted to see more of a ‘raise’ in the guide, but we would note that AFRM often guides conservatively.”
The company also highlighted recent strategic wins, including becoming the exclusive pay-over-time provider for QuickBooks Payments, renewing its partnership with Expedia, and expanding its collaboration with Wayfair. Affirm noted that loans more than 30 days delinquent—excluding Peloton and Pay in X products—rose 18 basis points from a year earlier but declined 7 basis points sequentially to 2.7%.