Affirm Holdings, Inc. (Affirm (AFRM)) shares dipped a bit on Wednesday, but the real action happened at the company's Investor Day in New York, where management laid out an ambitious growth blueprint. Bank of America Securities was there, and they came away impressed enough to bump their price target from $82 to $88 while keeping a Buy rating.
Let's start with the big number: Affirm is sticking with its goal of hitting $100 billion in annual gross merchandise volume (GMV) over the medium term. BofA figures that lands around fiscal 2029, which would require annual growth north of 25%. That's a lot, but the company sees contributions coming from multiple places: more than 10% each from merchant point-of-sale and direct-to-consumer channels, plus 1% to 5% from international markets. And there's potential upside from newer initiatives like Affirm Edge and agentic commerce — basically, AI-powered shopping assistants that could drive even more volume. For context, Wall Street's consensus for fiscal 2029 GMV is about $96.4 billion, so Affirm's target is a bit above that.
On the credit side, Affirm tightened its expected RLTC loss rate to a range of 3.75% to 4.0% of GMV. That's narrower than the previous 3% to 4% band and a touch higher than what investors had been expecting. But it's still a pretty tight range, and it reflects the company's confidence in its underwriting models.
Revenue is projected to land between 7.5% and 8.5% of GMV, with GAAP operating margins of 20% to 25% and adjusted operating margins of 30% to 35%. Put it all together, and you get a path to roughly $3 to $4 in earnings per share. That's broadly in line with what analysts were expecting, though stronger margins are offset by a higher assumed tax rate in the mid-to-high 20% range.
Now, the really interesting stuff: new products. Management spent a lot of time talking about the Affirm Card, which they think could eventually scale to $150 billion in GMV. That's based on 20 million users spending an average of $7,500 a year. That's a huge opportunity, and it's not just a pipe dream — the card is already a major growth driver.
Then there's international expansion. Affirm sees a global market outside the U.S., Canada, and China that's over $5 trillion. Its partnership with Shopify (SHOP) has already generated about $20 billion in GMV, and the company plans to expand into Australia, the Netherlands, Germany, and France. That's a lot of new territory.
Analysts are on board. Needham reiterated a Buy with a $90 target on May 13, BofA raised to $88 on May 11, and JPMorgan lifted to $80 on May 8. The average price target is $83.47, so Affirm's current price of $63.11 (down 3.55% on Wednesday) leaves some room to run.
Affirm's story is about scale, new products, and AI-driven commerce. If they can execute, the next few years could be interesting.
