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đ $AFRM: Up 34.6% with Profits in Sight
Affirm stock soars on record revenue and profitability outlook. đđ
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AFRM: AFRM $44.01
This week, Affirm Holdings takes center stage. The buy now, pay later giant has seen its stock surge an impressive 34.6% in response to its latest earnings report.
What's behind this significant rise? Let's dive into the details.
Record-Breaking Q4 Revenue
Affirm just released its fiscal fourth-quarter results, and they're making waves on Wall Street. Revenue surged 48% year-over-year to $659 million, surpassing analysts' expectations of $604 million. The company's gross merchandise volume (GMV)âthe total value of all transactions on their platformâjumped 31% to $7.2 billion, also exceeding estimates of $6.87 billion. But itâs not just about the past. Affirmâs guidance for the next quarter is also strong, with an expected GMV between $7.1 billion and $7.4 billion, and revenue ranging from $640 million to $670 million. This shows that Affirm is maintaining its momentum and looking ahead with confidence. Additional Reading |  |
Profitability Forecast
Hereâs where things get really interesting. Affirmâs CEO, Max Levchin, announced that the company expects to hit profitability on a GAAP basis by the fourth quarter of fiscal 2025. Thatâs significant news for a company that has been prioritizing growth over profits since day one. To achieve this, Affirm is focusing on scaling and increasing efficiency. The company saw 24.7 million transactions in Q4, up 42% from last year. Theyâre not just processing more transactionsâtheyâre also optimizing pricing and securing better funding deals, which are expected to boost their bottom line. Additional Reading |  |
Partnerships Fueling Growth
Affirm isnât just sitting back and waiting for customers to come to them. Theyâre expanding their reach through significant partnerships. One of the most noteworthy developments is Affirmâs new partnership with Apple. Later this year, U.S. Apple Pay users will be able to apply for loans directly through Affirm. This partnership, along with existing relationships with e-commerce giants like Amazon and Shopify, is expected to drive more transactions and solidify Affirmâs position as a leader in the buy now, pay later space. Additional Reading |  |
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Major Market News
Source: DALL-E
Wednesday, September 4 - U.S. Trade Deficit
What: The U.S. trade deficit report provides data on the difference between the value of exports and imports of goods and services.
Impact: A wider trade deficit of $79B compared to the previous $73.1B could indicate increased domestic demand or a stronger dollar, potentially affecting GDP calculations and currency markets.
Source: U.S. Bureau of Economic Analysis
Thursday, September 5 - Initial Jobless Claims
What: This weekly report shows the number of individuals who filed for unemployment insurance for the first time.
Impact: The forecasted 225,000 claims, lower than the previous 231,000, suggests a potentially improving job market. This data is crucial for assessing the overall health of the labor market and can influence Federal Reserve policy decisions.
Source: U.S. Department of Labor
Friday, September 6 - U.S. Employment Report
What: This comprehensive monthly report provides data on non-farm payrolls, the unemployment rate, and wage growth.
Impact: With 162,000 new jobs expected (higher than the previous 114,000) and a slight decrease in the unemployment rate to 4.2%, this report could significantly impact market sentiment and Federal Reserve policy considerations regarding interest rates.
Source: U.S. Bureau of Labor Statistics
Friday, Sept. 6 - Fed Speakers (Williams and Waller)
What: Speeches by New York Fed President John Williams and Federal Reserve Governor Christopher Waller.
Impact: These speeches could provide insights into the Federal Reserve's current thinking on monetary policy, economic outlook, and potential future interest rate decisions. Markets often react to such communications from key Fed officials.
Source: Federal Reserve
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