Affirm Beats on Revenue and Volume, but Levchin Flags Gas Prices Weighing on Shoppers

SAN FRANCISCO — Affirm reported revenue of $1.17 billion and gross merchandise volume of $14.1 billion for its fiscal fourth quarter, the results it disclosed on Aug. 27, beating analyst estimates on both measures. The company, which lets shoppers split purchases into installment payments at checkout, described the period as its most profitable quarter to date.

Chief Executive Max Levchin paired that result with a note of caution about the consumer, pointing to elevated gasoline prices as a pressure currently weighing on U.S. shoppers. It is a familiar tension for a lender whose volume rises with consumer spending but whose credit losses rise when household budgets tighten — the two forces the same macro conditions can pull in opposite directions.

For a buy-now-pay-later lender, the quality of a quarter like this turns on a question the headline GMV figure does not answer on its own: whether the volume growth came alongside stable credit performance or was purchased with looser approvals. Affirm has generally disclosed more about its credit metrics than several of its peers, including delinquency trends and the mix of interest-bearing versus zero-interest loans, which gives analysts more to work with than a single volume number.

Affirm’s model differs from some competitors in that a meaningful share of its volume carries interest and is underwritten loan-by-loan at the point of sale, rather than relying solely on the merchant-funded, zero-interest “pay-in-four” structure. That mix matters for how the company earns money and for how its book behaves as consumer credit softens: interest-bearing loans generate more revenue per dollar of GMV but also carry the credit risk directly.

Levchin’s comment about gas prices is the kind of qualitative signal that tends to precede the quantitative one. Discretionary installment spending is sensitive to how much of a household’s budget is already committed to non-discretionary costs like fuel, and a CEO flagging that pressure on an earnings call is, in effect, telling investors where to look in the next quarter’s credit data.

The results land against a broader backdrop of rising consumer-credit stress, with recent Federal Reserve data showing credit card delinquencies at their highest rate in well over a decade. Buy-now-pay-later loans remain largely absent from those official household-debt statistics, since most providers, Affirm included for much of its volume, do not furnish the full detail of installment lending to the major credit bureaus — a gap that leaves a fast-growing slice of consumer borrowing outside the standard measures regulators watch.