Exceeds First Quarter Financial Outlook and
Raises Outlook for Gross Merchandise Volume (GMV), Revenue, and
Revenue Less Transaction Costs for Fiscal Year 2022
Expands Network by Increasing Active Merchants
from 6,500 to 102,000 and Active Consumers by 124% to 8.7 million
Year Over Year
Grows Year-Over-Year GMV by 84%, or 138%
Excluding Largest Merchant
Expands Amazon Relationship to All Eligible
U.S. Purchases; Affirm to be Embedded as Payment Option in Amazon
Pay's Digital Wallet in the U.S.
Affirm Holdings, Inc. (NASDAQ: AFRM) (“Affirm” or the
"Company”), the payment network that empowers consumers and helps
merchants drive growth, today reported financial results for its
fiscal 2022 first quarter ended September 30, 2021.
“Our strong quarter once again demonstrates the continued
momentum across Affirm as more people embrace the transparency,
flexibility and value our solutions provide,” said Max Levchin,
Founder and CEO of Affirm. “Our unrivaled technology,
industry-leading talent and the investments we are making are
delivering results. Over the last year, we expanded our network by
increasing the number of active merchants on our platform to over
100,000 and more than doubling the number of active consumers.
These deep connections and our partnerships with merchants drove
growth in GMV, frequency of engagement, and revenue.”
Levchin continued, “We are pleased with our performance and
proud of the contributions of our nearly 2,000-strong Affirm team.
At the same time, there is a lot more for us to build to achieve
our objectives, and we are even more excited about the
opportunities ahead. We remain focused on continuing to delight and
grow both sides of our network by giving people even more reasons
to choose Affirm with more products and in more markets.”
First Quarter of Fiscal Year 2022 Operating
Highlights:
All comparisons are made versus the same period in fiscal year
2021 unless otherwise stated.
- Gross merchandise volume ("GMV") for the first quarter of
fiscal 2022 was $2.7 billion, an increase of 84%, or 138% excluding
the Company's largest merchant
- Active merchants increased from 6,500 to 102,000, with the
substantial majority coming from the adoption of Shop Pay
Installments by merchants on Shopify's platform
- Active consumers grew 124% to 8.7 million and increased by 1.6
million, or 22%, compared to the period ended June 30, 2021
- Transactions per active consumer increased 8% to 2.3 as of
September 30, 2021
First Quarter of Fiscal Year 2022 Financial
Highlights:1
All comparisons are made versus the same period in fiscal year
2021 unless otherwise stated.
- Total revenue was $269.4 million, a 55% increase, driven
primarily by increases in interest income related to growth in
loans held for investment, network revenue driven by GMV growth,
and gains on sales of loans
- Total revenue less transaction costs1 was $112.1 million,
compared to $55.3 million in the first quarter of fiscal 2021,
primarily as a result of the strong revenue growth, as well as
slower growth in transaction costs as we achieved scale
efficiencies. In the period, provision for credit losses increased
by $34.7 million from the first quarter of fiscal 2021. This
increase was driven by a release of excess loan allowance in the
prior year period and a more normal credit environment in the
quarter ended September 30, 2021 compared to the prior year
- Operating loss was $166.1 million compared to $33.3 million in
the first quarter of fiscal 2021, and includes a $87.0 million
increase in stock-based compensation following the Company's
January 2021 initial public offering, as well as investments in
product and engineering talent and marketing to deliver on the
Company's growth opportunities
- Adjusted operating loss for the first quarter of fiscal 2022
was $45.1 million, compared to the adjusted operating loss of $7.9
million reported in the first quarter of fiscal 2021
- Net loss for the first quarter of fiscal 2022 was $306.6
million compared to $3.9 million in the first quarter of fiscal
2021, and includes the above-mentioned increase in stock-based
compensation following the Company's IPO, as well as $141.6 million
of additional expense recognized based on the change in fair value
of the contingent consideration liability associated with the
Company's acquisition of PayBright driven by increases in the value
of its common stock
Recent Business Highlights
- Today, the Company announced that it has expanded its
relationship with Amazon. Affirm will be generally available to
support all eligible purchases of $50 or more on Amazon.com and the
Amazon shopping app in the United States. Consumers will have the
option to split the total cost of eligible purchases into monthly
payments at checkout with no late or hidden fees, ever. As part of
an amended agreement, Affirm will serve as Amazon's only third
party, non credit card, buy now, pay later ("BNPL") option in the
U.S. Until January 2023, Amazon will be subject to certain
restrictions on providing other installment products in the U.S. by
other BNPL providers. Affirm will also be integrated into Amazon
Pay’s digital wallet in the U.S. In conjunction with the amended
agreement, Amazon will receive multiple tranches of warrants to
purchase shares of Affirm's Class A Common Stock, some of which are
subject to satisfaction of certain performance obligations and
vesting conditions. Additional details are included in a Form 8-K
filing that will be available here
- On November 3, the Company announced the expansion of its
successful partnership with Peloton to provide Affirm's 0% APR
offering to consumers in Australia on Peloton's Bike and Bike+ over
12, 24, 39 or 43 months with no late or hidden fees
- Today, the Company successfully completed a $247 million
securitization of its long-duration 0% APR point-of-sale
installment loans, achieving the lowest credit spread in this
program to date. Similar to the Company's most recent 0% APR
point-of-sale installment securitization, this transaction
qualifies for non-consolidated accounting treatment. This marks the
Company's seventh overall asset-backed security transaction since
launching the program in 2020
Michael Linford, CFO of Affirm, commented, “During the first
quarter, we continued to scale our two-sided network, delivering
robust top-line growth, strong unit economics and even greater
capital efficiency. We are seeing traction across all products and
verticals, and deepening our trusted relationships with merchants
and consumers alike. As we continue to capitalize on our hyper
growth phase, we are strongly positioning ourselves for the
long-term by investing in our key competitive advantages in
technology and talent.”
Financial Outlook
The following table summarizes Affirm's financial outlook for
the fiscal second quarter and full year 2022 periods.
Fiscal Q2 2022
Fiscal Year 2022
GMV
$3.55 to $3.65 billion
$13.13 to $13.38 billion
Revenue
$320 to $330 million
$1,225 to $1,250 million
Transaction Costs
$143 to $148 million
$645 to $655 million
Revenue Less Transaction Costs
$178 to $183 million
$580 to $595 million
Adjusted Operating Loss as a Percentage of
Revenue2
(7) to (5) percent
(14) to (12) percent
Weighted Average Shares Outstanding
285 million
290 million
The Company's financial outlook for the fiscal second quarter
and full year 2022 assumes the following:
- The Company's outlook does not include estimates of potential
contributions to GMV, revenue, or transaction costs from its
partnership with Amazon. However, certain technology and marketing
expenses associated with the onboarding and ramping of the expanded
Amazon partnership are included in the Company's outlook for
adjusted operating margin for Fiscal Year 2022. Beginning with its
fiscal third quarter, the Company plans to begin including
estimates of the GMV, revenue, and transaction costs related to the
Amazon partnership in its financial outlook
- The Company's outlook assumes no material impact to GMV,
revenue, or transaction costs from the rollout of its Affirm Debit+
card or its recently announced partnership to enter the Australian
market
Conference Call Affirm will host a conference call and
webcast to discuss first quarter fiscal year 2022 financial results
on Wednesday, November 10, 2021, at 5:00 pm ET. Hosting the call
will be Max Levchin, Founder and Chief Executive Officer, and
Michael Linford, Chief Financial Officer. The conference call will
be webcast live from the Company's investor relations website at
https://investors.affirm.com/. A replay will be available on the
investor relations website following the call
Key Operating Metrics, Non-GAAP
Financial Measures and Supplemental Performance Indicators
Three Months Ended September
30,
2021
2020
(in millions, except GMV and
percent data) (unaudited)
GMV (in billions)
$
2.7
$
1.5
Total Revenue, net
$
269.4
$
174.0
Total Revenue as a % of GMV
9.9
%
11.8
%
Transaction Costs (Non-GAAP)
$
157.3
$
118.6
Transaction Costs as a % of GMV
5.8
%
8.0
%
Revenue Less Transaction Costs
(Non-GAAP)
$
112.1
$
55.3
Revenue Less Transaction Costs as a % of
GMV (Non-GAAP)
4.1
%
3.7
%
Operating Loss
$
(166.1
)
$
(33.3
)
Operating Margin
(61.6
)
%
(19.1
)
%
Adjusted Operating Loss (Non-GAAP)
$
(45.1
)
$
(7.9
)
Adjusted Operating Margin (Non-GAAP)
(16.7
)
%
(4.6
)
%
Net Loss
$
(306.6
)
$
(3.9
)
September 30, 2021
June 30, 2021
September 30, 2020
Active Consumers (in millions)
8.7
7.1
3.9
Transactions per Active Consumer
2.3
2.3
2.2
Active Merchants (in thousands)
102.2
29.0
6.5
Total Platform Portfolio (Non-GAAP) (in
billions)
$
5.0
$
4.7
$
2.9
Equity Capital Required (Non-GAAP) (in
millions)
$
140.2
$
178.1
$
220.4
Equity Capital Required as a % of Total
Platform Portfolio (Non-GAAP)
2.8
%
3.8
%
7.6
%
Allowance for Credit Losses as a % of
Loans Held for Investment
6.8
%
5.8
%
8.7
%
Key Operating Metrics
- Gross Merchandise Volume ("GMV") - The Company defines GMV as
the total dollar amount of all transactions on the Affirm platform
during the applicable period, net of refunds. GMV does not
represent revenue earned by the Company. However, the Company
believes that GMV is a useful operating metric to both the Company
and investors in assessing the volume of transactions that take
place on the Company's platform, which is an indicator of the
success of the Company's merchants and the strength of that
platform.
- Active Consumers - The Company defines an active consumer as a
consumer who engages in at least one transaction on its platform
during the 12 months prior to the measurement date. The Company
believes that active consumers is a useful operating metric to both
the Company and investors in assessing consumer adoption and
engagement and measuring the size of the Company's network.
- Transactions per Active Consumer - Transactions per active
consumer is defined as the average number of transactions that an
active consumer has conducted on its platform during the 12 months
prior to the measurement date. The Company believes that
transactions per active consumer is a useful operating metric to
both the Company and investors in assessing consumer engagement and
repeat usage, which is an indicator of the value of the Company's
network.
Non-GAAP Financial Measures
- Transaction Costs - The Company defines transaction costs as
the sum of loss on loan purchase commitment, provision for credit
losses, funding costs, and processing and servicing expense. The
Company believes that transaction costs is a useful financial
measure to both the Company and investors of those costs, which
vary with the volume of transactions processed on the Company's
platform.
- Transaction Costs as a Percentage of GMV - The Company defines
transaction costs as a percentage of GMV as transaction costs, as
defined above, as a percentage of GMV, as defined above. The
Company believes that transaction costs as a percentage of GMV is a
useful financial measure to both the Company and investors as it
approximates the variable cost efficiency of transactions processed
on the Company's platform.
- Revenue Less Transaction Costs - The Company defines revenue
less transaction costs as GAAP total revenue less transaction
costs, as defined above. The Company believes that revenue less
transaction costs is a useful financial measure to both the Company
and investors of the economic value generated by transactions
processed on the Company's platform.
- Revenue Less Transaction Costs as a Percentage of GMV - The
Company defines revenue less transaction costs as a percentage of
GMV as revenue less transaction costs, as defined above, as a
percentage of GMV, as defined above. The Company believes that
revenue less transaction costs as a percentage of GMV is a useful
financial measure to both the Company and investors of the unit
economics of transactions processed on the Company's platform.
- Adjusted Operating (Loss) Income - The Company defines adjusted
operating (loss) income as its GAAP operating loss, excluding: (a)
depreciation and amortization; (b) stock-based compensation
included in GAAP operating loss; (c) the amortization of its
commercial agreement asset; and (d) certain other costs as set
forth in the reconciliation of adjusted operating (loss) income to
GAAP operating loss included in the tables at the end of this press
release. Adjusted operating (loss) income is presented because the
Company believes that it is a useful financial measure to both the
Company and investors for evaluating its operating performance and
that it facilitates period to period comparisons of the Company's
results of operations as the items excluded generally are not a
function of the Company's operating performance.
- Adjusted Operating Margin - The Company defines adjusted
operating margin as its adjusted operating (loss) income, as
defined above, as a percentage of its GAAP total revenue. Similar
to adjusted operating (loss) income, the Company believes that
adjusted operating margin is a useful financial measure to both the
Company and investors for evaluating its operating performance and
that it facilitates period to period comparisons of the Company's
results of operations as the items excluded generally are not a
function of the Company's operating performance.
- Total Platform Portfolio - The Company defines total platform
portfolio as the unpaid principal balance outstanding of all loans
facilitated through its platform as of the balance sheet date,
including loans held for investment, loans held for sale, and loans
owned by third-parties. The Company believes that total platform
portfolio is a useful financial measure to both the Company and
investors in assessing the scale of funding requirements for the
Company's network.
- Equity Capital Required - The Company defines equity capital
required as the sum of the balance of loans held for investment and
loans held for sale, less the balance of funding debt and notes
issued by securitization trusts as of the balance sheet date. The
Company believes that equity capital required is a useful financial
measure to both the Company and investors in assessing the amount
of the Company's total platform portfolio that the Company funds
with its own equity capital.
- Equity Capital Required as a Percentage of Total Platform
Portfolio - The Company defines equity capital required as a
percentage of total platform portfolio as equity capital required,
as defined above, as a percentage of total platform portfolio, as
defined above. The Company believes that equity capital required as
a percentage of total platform portfolio is a useful financial
measure to both the Company and investors in assessing the
proportion of outstanding loans on the Company's platform that are
funded by the Company's own equity capital.
Supplemental Performance Indicators
- Active Merchants - The Company defines an active merchant as a
merchant which engages in at least one transaction on its platform
during the 12 months prior to the measurement date. The Company
believes that active merchants is a useful performance indicator to
both the Company and investors because it measures the reach of the
Company's network.
- Total Revenue as a Percentage of GMV - The Company defines
total revenue as a percentage of GMV as GAAP total revenue as a
percentage of GMV, as defined above. The Company believes that
total revenue as a percentage of GMV is a useful performance
indicator to both the Company and investors of the revenue
generated on a transaction processed on the Company's
platform.
- Allowance for Credit Losses as a Percentage of Loans Held for
Investment - The Company defines allowance for credit losses as a
percentage of loans held for investment as GAAP allowance for
credit losses as a percentage of GAAP loans held for investment.
The Company believes that allowance for credit losses as a
percentage of loans held for investment is a useful performance
indicator to both the Company and investors of the future estimated
credit losses on the Company's outstanding loans held for
investment.
Use of Non-GAAP Financial Measures To supplement the
Company's condensed consolidated financial statements, which are
prepared and presented in accordance with generally accepted
accounting principles in the United States ("GAAP"), the Company
presents the following non-GAAP financial measures: transaction
costs, transaction costs as a percentage of GMV, revenue less
transaction costs, revenue less transaction costs as a percentage
of GMV, adjusted operating loss, adjusted operating margin, total
platform portfolio, equity capital required, and equity capital
required as a percentage of total platform portfolio. Definitions
of these non-GAAP financial measures are included under "Key
Operating Metrics, Non-GAAP Financial Measures and Supplemental
Performance Indicators" above, and reconciliations of these
non-GAAP financial measures with the most directly comparable GAAP
financial measures are included in the tables below.
Summaries of the reasons why the Company believes that the
presentation of each of these non-GAAP financial measures provides
useful information to the Company and investors are included under
"Key Operating Metrics, Non-GAAP Financial Measures and
Supplemental Performance Indicators" above. In addition, the
Company uses these non-GAAP financial measures in conjunction with
financial measures prepared in accordance with GAAP for planning
purposes, including the preparation of its annual operating budget,
and for evaluating the effectiveness of its business strategy.
However, these non-GAAP financial measures are presented for
supplemental informational purposes only, and these non-GAAP
financial measures have limitations as analytical tools. Some of
these limitations are as follows:
- Revenue less transaction costs and revenue less transaction
costs as a percentage of GMV are not intended to be measures of
operating profit or loss as they exclude key operating expenses
such as technology and data analytics, sales and marketing, and
general and administrative expenses;
- Adjusted operating loss and adjusted operating margin exclude
certain recurring, non-cash charges such as depreciation and
amortization, although the assets being depreciated and amortized
may need to be replaced in the future, and share-based compensation
expense, which has been, and will continue to be for the
foreseeable future, a significant recurring expense and an
important part of the Company's compensation strategy; and
- Other companies, including companies in the same industry, may
calculate these non-GAAP financial measures differently from how
the Company calculates them or not at all, which reduces its
usefulness as a comparative measure.
Accordingly, investors should not consider these non-GAAP
financial measures in isolation or as substitutes for analysis of
the Company's financial results as reported under GAAP, and these
non-GAAP measures should be considered along with other operating
and financial performance measures presented in accordance with
GAAP. Investors are encouraged to review the related GAAP financial
measures and the reconciliations of these non-GAAP financial
measures to their most directly comparable GAAP financial measures
and not rely on any single financial measure to evaluate the
business.
Cautionary Note About Forward-Looking Statements This
document contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the
“Securities Act”), and Section 21E of the Securities Exchange Act
of 1934, as amended, that involve risks and uncertainties. All
statements other than statements of historical fact are
forward-looking statements, including statements regarding: the
Company's strategy and future operations, including the Company's
partnerships with Amazon, Peloton and Shopify; the development,
innovation, introduction and performance of the Company's products,
including the Debit+ Card; acquisition and retention of merchants
and consumers; the Company's future growth, investments, network
expansion, product mix, brand awareness, financial position, gross
market value, revenue, transaction costs, operating income,
provision for credit losses, and cash flows; and general economic
trends and trends in the Company's industry and markets. These
forward-looking statements involve known and unknown risks,
uncertainties and other important factors that may cause the
Company's actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements.
Risks, uncertainties and assumptions include factors relating
to: the Company's need to attract additional merchants, partners
and consumers and retain and grow its relationships with existing
merchants, partners and consumers; the highly competitive nature of
its industry; its need to maintain a consistently high level of
consumer satisfaction and trust in its brand; the concentration of
a large percentage of its revenue with a single merchant partner;
its ability to sustain its revenue growth rate or the growth rate
of its related key operating metrics; the terms of its agreement
with one of its originating bank partners; its existing funding
arrangements that may not be renewed or replaced or its existing
funding sources that may be unwilling or unable to provide funding
to it on terms acceptable to it, or at all; its ability to
effectively underwrite loans facilitated through its platform and
accurately price credit risk; the performance of loans facilitated
through its platform; changes in market interest rates; its
securitizations, warehouse credit facilities and forward flow
agreements; the impact on its business of general economic
conditions, the financial performance of its merchants, and
fluctuations in the U.S. consumer credit market; its ability to
grow effectively through acquisitions or other strategic
investments or alliances; and other risks that are described in its
Annual Report on Form 10-K for the fiscal year ended June 30, 2021
and in its other filings with the U.S. Securities and Exchange
Commission.
These forward-looking statements reflect the Company's views
with respect to future events as of the date hereof and are based
on assumptions and subject to risks and uncertainties. Given these
uncertainties, investors should not place undue reliance on these
forward-looking statements. The forward-looking statements are made
as of the date hereof, and the Company assumes no obligation and
does not intend to update these forward-looking statements.
About Affirm Affirm’s mission is to deliver honest
financial products that improve lives. By building a new kind of
payment network — one based on trust, transparency and putting
people first — we empower millions of consumers to spend and save
responsibly, and give thousands of businesses the tools to fuel
growth. Unlike credit cards and other pay-over-time options, we
show consumers exactly what they will pay up front, never increase
that amount, and never charge any late or hidden fees.
AFRM-F
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(in thousands, except share and
per share amounts)
September 30, 2021
June 30, 2021
Assets
Cash and cash equivalents
$
1,439,531
$
1,466,558
Restricted cash
236,282
226,074
Securities available for sale at fair
value
456,266
16,170
Loans held for sale
1,808
13,030
Loans held for investment
2,244,826
2,022,320
Allowance for credit losses
(152,021
)
(117,760
)
Loans held for investment, net
2,092,805
1,904,560
Accounts receivable, net
100,951
91,575
Property, equipment and software, net
84,925
62,499
Goodwill
540,770
516,515
Intangible assets
71,378
67,930
Commercial agreement assets
207,431
227,377
Other assets
169,952
274,679
Total Assets
$
5,402,099
$
4,866,967
Liabilities and Stockholders’
Equity
Liabilities:
Accounts payable
$
425,854
$
57,758
Payable to third-party loan owners
38,462
50,079
Accrued interest payable
3,304
2,751
Accrued expenses and other liabilities
450,662
323,578
Notes issued by securitization trusts
1,621,638
1,176,673
Funding debt
484,821
680,602
Total liabilities
3,024,741
2,291,441
Stockholders’ equity:
Class A common stock, par value $0.00001
per share: 3,030,000,000 shares authorized, 200,336,842 shares
issued and outstanding as of September 30, 2021; 3,030,000,000
shares authorized, 181,131,728 shares issued and outstanding as of
June 30, 2021
2
2
Class B common stock, par value $0.00001
per share: 140,000,000 shares authorized, 77,380,330 shares issued
and outstanding as of September 30, 2021; 140,000,000 shares
authorized, 88,226,376 shares issued and outstanding as of June 30,
2021
1
1
Additional paid in capital
3,579,763
3,467,236
Accumulated deficit
(1,205,100
)
(898,485
)
Accumulated other comprehensive gain
2,692
6,772
Total stockholders’ equity
2,377,358
2,575,526
Total Liabilities and Stockholders’
Equity
$
5,402,099
$
4,866,967
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
(in thousands, except share and
per share amounts)
Three Months Ended September
30,
2021
2020
Revenue
Merchant network revenue
$
92,244
$
93,265
Virtual card network revenue
19,395
5,958
Total network revenue
111,639
99,223
Interest income
117,302
54,237
Gain on sales of loans
30,979
16,434
Servicing income
9,465
4,084
Total Revenue, net
$
269,385
$
173,978
Operating Expenses
Loss on loan purchase commitment
$
51,678
$
65,868
Provision for credit losses
63,647
28,931
Funding costs
16,753
10,352
Processing and servicing
25,201
13,498
Technology and data analytics
78,013
33,768
Sales and marketing
63,960
22,582
General and administrative
136,204
32,273
Total Operating Expenses
435,456
207,272
Operating Loss
$
(166,071
)
$
(33,294
)
Other (expense) income, net
(140,373
)
29,445
Loss Before Income Taxes
$
(306,444
)
$
(3,849
)
Income Tax Expense
171
97
Net Loss
$
(306,615
)
$
(3,946
)
Other Comprehensive Income
(Loss)
Foreign currency translation
adjustments
$
(3,802
)
$
405
Unrealized gain (loss) on securities
available for sale, net
(279
)
—
Net Other Comprehensive (Loss)
Income
(4,081
)
405
Comprehensive Loss
$
(310,696
)
$
(3,541
)
Per share data:
Net loss per share attributable to
common stockholders for Class A and Class B:
Basic
$
(1.13
)
$
(0.06
)
Diluted
$
(1.13
)
$
(0.06
)
Weighted average common shares
outstanding
Basic
271,677,516
64,778,024
Diluted
271,677,516
68,256,189
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended September
30,
2021
2020
Cash Flows from Operating
Activities
Net Loss
$
(306,615
)
$
(3,946
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Provision for credit losses
63,647
28,931
Amortization of premiums and discounts on
loans, net
(35,708
)
(11,123
)
Gain on sales of loans
(30,979
)
(16,434
)
Changes in fair value of assets and
liabilities
139,884
(30,202
)
Amortization of commercial agreement
assets
18,971
14,261
Amortization of debt issuance costs
5,231
1,083
Stock-based compensation
93,189
6,203
Depreciation and amortization
10,541
3,720
Other
4,002
608
Purchases of loans held for sale
(896,786
)
(346,878
)
Proceeds from the sale of loans held for
sale
888,580
338,926
Change in operating assets and
liabilities:
Accounts receivable, net
(12,076
)
10,175
Other assets
78,086
(64,412
)
Accrued interest payable
553
798
Accounts payable
368,096
6,110
Accrued expenses and other liabilities
(11,848
)
63,669
Payable to third-party loan owners
(11,618
)
(3,793
)
Net Cash Provided by (Used) in
Operating Activities
365,150
(2,304
)
Cash Flows from Investing
Activities
Purchases and origination of loans held
for investment
(1,847,458
)
(1,177,769
)
Proceeds from the sale of loans held for
investment
195,039
75,049
Principal repayments and other loan
servicing activity
1,486,099
749,128
Acquisition, net of cash and restricted
cash acquired
(5,999
)
—
Additions to property, equipment and
software
(16,347
)
(4,169
)
Purchases of securities available for
sale
(443,560
)
—
Proceeds from maturities and repayments of
securities available for sale
889
—
Other investing cash inflows
4,827
—
Other investing cash outflows
(3,000
)
—
Net Cash Used in Investing
Activities
(629,510
)
(357,761
)
Cash Flows from Financing
Activities
Proceeds from funding debt
682,106
773,938
Payment of debt issuance costs
(6,609
)
(4,617
)
Principal repayments of funding debt
(873,778
)
(890,556
)
Proceeds from issuance of notes and
residual trust certificates by securitization trusts
499,789
518,232
Principal repayments of notes issued by
securitization trusts
(55,204
)
(14,777
)
Proceeds from issuance of redeemable
convertible preferred stock, net
—
434,434
Proceeds from exercise of common stock
options and warrants
37,470
1,741
Repurchases of common stock
(4
)
(584
)
Payments of tax withholding for
stock-based compensation
(39,817
)
—
Net Cash Provided by Financing
Activities
243,953
817,811
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
3,588
—
Net (Decrease) Increase in Cash, Cash
Equivalents and Restricted Cash
(16,819
)
457,746
Cash and cash equivalents and restricted
cash, beginning of period
1,692,632
328,128
Cash and Cash Equivalents and
Restricted Cash, end of period
$
1,675,813
$
785,874
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS, CONT.
(Unaudited)
(in thousands)
Three Months Ended September
30,
2021
2020
Supplemental Disclosures of Cash Flow
Information
Cash payments for interest
$
10,195
$
6,934
Cash paid for income taxes
72
—
Cash paid for operating leases
4,475
3,148
Supplemental Disclosures of Non-Cash
Investing and Financing Activities
Stock-based compensation included in
capitalized internal-use software
$
11,690
$
972
Additions to property and equipment
included in accrued expenses
56
15
Issuance of warrants in exchange for
commercial agreement
—
67,645
Conversion of convertible debt
—
88,559
Issuance of common stock in connection
with acquisition
10,000
—
Reconciliation of Non-GAAP Financial
Measures
The following tables present a reconciliation of transaction
costs, revenue less transaction costs, adjusted operating loss,
adjusted operating margin, and equity capital required to their
most directly comparable financial measures prepared in accordance
with GAAP for each of the periods indicated.
Three Months Ended September
30,
2021
2020
(in thousands, except percent
data) (unaudited)
Operating Expenses
Loss on loan purchase commitment
$
51,678
$
65,868
Provision for credit losses
63,647
28,931
Funding costs
16,753
10,352
Processing and servicing
25,201
13,498
Transaction Costs (Non-GAAP)
$
157,279
$
118,649
Technology and data analytics
78,013
33,768
Sales and marketing
63,960
22,582
General and administrative
136,204
32,273
Total Operating Expenses
$
435,456
$
207,272
Total Revenue
$
269,385
$
173,978
Less: Transaction Costs (Non-GAAP)
(157,279
)
(118,649
)
Revenue Less Transaction Costs
(Non-GAAP)
$
112,106
$
55,329
Operating Loss
$
(166,071
)
$
(33,294
)
Add: Depreciation and amortization
10,541
3,720
Add: Stock-based compensation included in
operating expenses
93,189
6,203
Add: Amortization of Shopify Inc.
commercial agreement asset
17,039
14,261
Add: Other costs3
209
1,191
Adjusted Operating Loss
(Non-GAAP)
$
(45,093
)
$
(7,919
)
Divided by: Total Revenue, net
$
269,385
$
173,978
Adjusted Operating Margin
(Non-GAAP)
(16.7
)
%
(4.6
)
%
September 30, 2021
June 30, 2021
September 30, 2020
(in thousands) (unaudited)
Loans held for investment
$
2,244,826
$
2,022,320
$
1,414,157
Add: Loans held for sale
1,808
13,030
4,085
Less: Funding debt
(484,821
)
(680,602
)
(698,892
)
Less: Notes issued by securitization
trusts
(1,621,638
)
(1,176,673
)
(498,921
)
Equity Capital Required
(Non-GAAP)
$
140,175
$
178,075
$
220,429
______________________________ 1 Information about Affirm's use
of non-GAAP financial measures is provided under "Key Operating
Metrics, Non-GAAP Financial Measures and Supplemental Performance
Indicators" and "Use of Non-GAAP Financial Measures" below, and
reconciliations of GAAP results to non-GAAP results are provided in
the tables at the end of this press release. 2 A reconciliation of
adjusted operating loss as a percentage of revenue to the
comparable GAAP measure is not available on a forward-looking basis
without unreasonable effort due to the uncertainty regarding, and
the potential variability of, expenses that may be incurred in the
future. 3 Other costs consists of one-time expenses incurred in the
period associated with the Company's initial public offering and
its acquisitions.
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version on businesswire.com: https://www.businesswire.com/news/home/20211110006346/en/
Investor Relations ir@affirm.com
Media press@affirm.com
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