Affirm Holdings, Inc.

Previous wording

We are building the next generation payment network. We believe that by using modern technology, strong engineering talent, and a mission-driven approach, we can reinvent payments and commerce. Our solutions, which are built on trust and transparency, are designed to make it easier for consumers to spend responsibly and with confidence, easier for merchants and commerce platforms to convert sales and grow, and easier for commerce to thrive.

Current wording

We are building the next generation payment network. We believe that by using modern technology, strong engineering talent, and a mission-driven approach, we can reinvent payments and commerce. Our solutions, which are built on trust and transparency, are designed to make it easier for consumers to spend and save responsibly and with confidence, easier for merchants and commerce platforms to convert sales and grow, and easier for commerce to thrive.

Previous wording

Our point-of-sale solutions allow consumers to pay for purchases in fixed amounts without deferred interest, late fees, or penalties. We empower consumers to pay over time rather than paying for a purchase entirely upfront. This increases consumers’ purchasing power and gives them more control and flexibility. Our platform facilitates both true 0% APR payment options and interest-bearing loans. On the merchant side, we offer commerce enablement, demand generation, and consumer acquisition tools. Our solutions empower merchants to more efficiently promote and sell their products, optimize their consumer acquisition strategies, and drive incremental sales. We also provide valuable product-level data and insights — information that merchants cannot easily get elsewhere — to better inform their strategies. Finally, for consumers, our app unlocks the full suite of Affirm products for a delightful end-to-end consumer experience. Consumers can use our app to apply for installment loans, and upon approval, they can use the Affirm Card digitally online or in-stores to complete a purchase. Additionally, consumers can manage the pre and post purchase split of Affirm Card transactions into loan, manage payments, open a high-yield savings account, and access a personalized marketplace.

Current wording

Our point-of-sale solutions allow consumers to pay for purchases in fixed amounts without deferred interest, late fees, or penalties. We empower consumers to pay over time rather than paying for a purchase entirely upfront. This increases consumers’ purchasing power and gives them more control and flexibility. Our platform facilitates both true 0% APR payment options and interest-bearing loans. On the merchant side, we offer commerce enablement, demand generation, and consumer acquisition tools. Our solutions empower merchants to more efficiently promote and sell their products, optimize their consumer acquisition strategies, and drive incremental sales. We also provide valuable product-level data and insights — information that merchants cannot easily get elsewhere — to better inform their strategies. Finally, for consumers, our app unlocks the full suite of Affirm products for a delightful end-to-end consumer experience. Consumers can use our app to apply for installment loans, and upon approval, they can use the Affirm Card digitally online or in-stores to complete a purchase. Additionally, consumers can manage the pre and post purchase split of Affirm Card transactions into a loan, manage payments, open a high-yield savings account, and access a personalized marketplace.

Previous wording

We have three main loan product offerings: Pay-in-4, 0% annual percentage rate (“APR”) monthly installment loans and interest-bearing monthly installment loans. Pay-in-4 is a short-term payment plan with four biweekly 0% APR installments.

Current wording

We have three main loan product offerings: Pay-in-X, 0% annual percentage rate (“APR”) monthly installment loans and interest-bearing monthly installment loans. Pay-in-X primarily consists of short-term payment plans with one to four 0% APR installments.

Previous wording

From merchants, we typically earn a fee when we help them convert a sale and facilitate a transaction. Merchant fees depend on the individual arrangement between us and each merchant and vary based on the terms of the product offering; we generally earn larger merchant fees on 0% APR financing products. For the years ended June 30, 2024, 2023, and 2022, Pay-in-4 represented 15%, 19%, and 22%, respectively, of total GMV facilitated through our platform while 0% APR installment loans represented 11%, 13%, and 21%, respectively.

Current wording

From merchants, we typically earn a fee when we help them convert a sale and facilitate a transaction. Merchant fees depend on the individual arrangement between us and each merchant and vary based on the terms of the product offering; we generally earn larger merchant fees on 0% APR financing products. For the years ended June 30, 2025, 2024, and 2023, Pay-in-X represented 14%, 15%, and 19%, respectively, of total GMV facilitated through our platform while 0% APR installment loans represented 13%, 11%, and 13%, respectively.

Previous wording

From consumers, we earn interest income on the simple interest loans that we originate or purchase from our originating bank partners. Interest rates charged to our consumers vary depending on the transaction risk, creditworthiness of the consumer, the repayment term selected by the consumer, the amount of the loan, and the individual arrangement with a merchant. Because our consumers are never charged deferred or compounding interest, late fees, or penalties on the loans, we are not incentivized to profit from our consumers’ hardships. In addition, interest income includes the amortization of any discounts or premiums on loan receivables created upon either the purchase of a loan from one of our originating bank partners or our direct origination of a loan. For the years ended June 30, 2024, 2023, and 2022, interest bearing loans represented 74%, 68%, and 58% of total GMV facilitated through our platform, respectively.

Current wording

From consumers, we earn interest income on the simple interest loans that we originate or purchase from our originating bank partners. Interest rates charged to our consumers vary depending on the transaction risk, creditworthiness of the consumer, the repayment term selected by the consumer, the amount of the loan, and the individual arrangement with a merchant. Because our consumers are never charged deferred or compounding interest, late fees, or penalties on the loans, we are not incentivized to profit from our consumers’ hardships. In addition, interest income includes the amortization of any discounts or premiums on loan receivables created upon either the purchase of a loan from one of our originating bank partners or our direct origination of a loan. For the years ended June 30, 2025, 2024, and 2023, interest bearing loans represented 72%, 74%, and 68% of total GMV facilitated through our platform, respectively.

Previous wording

In order to accelerate our ubiquity, we facilitate the issuance of virtual cards directly to consumers through our app, allowing them to shop with merchants that may not yet be fully integrated with Affirm. Similarly, we also facilitate the issuance of the Affirm Card, a debit card that can be used physically or virtually and which allows consumers to link a bank account to pay in full, or pay later by accessing credit through the Affirm App. When these cards are used over established card networks, we earn a portion of the interchange fee from the transaction.

Current wording

In order to accelerate our ubiquity, we facilitate the issuance of one-time-use virtual cards directly to consumers through our app, allowing them to shop with merchants that may not yet be fully integrated with Affirm. Similarly, we also facilitate the issuance of the Affirm Card, a card that can be used physically or virtually and which allows consumers to link a bank account to pay in full, or pay later by accessing credit through the Affirm App. When these cards are used over established card networks, we earn a portion of the interchange fee from the transaction.

Previous wording

When a consumer applies for a loan through our platform, the loan is underwritten using our proprietary risk model. Once approved for the loan, the consumer then selects their preferred repayment option. A portion of these loans are funded and issued by our originating bank partners, which include Cross River Bank, an FDIC-insured New Jersey state-chartered bank, Celtic Bank, an FDIC-insured Utah state-chartered industrial bank, and Lead Bank, an FDIC-insured Missouri state-chartered bank. These partnerships allow us to benefit from our partners’ ability to originate loans under their banking licenses while complying with various federal, state, and other laws. Under this arrangement, we must comply with our originating bank partners' credit policies and underwriting procedures, and our originating bank partners maintain ultimate authority to decide whether to originate a loan or not. When an originating bank partner originates a loan, it funds the loan through its own funding sources and may subsequently offer and sell the loan to us. Pursuant to our agreements with these partners, we are obligated to purchase the loans facilitated through our platform that such partner offers us and our obligation is secured by cash deposits. To date, we have purchased all of the loans facilitated through our platform and originated by our originating bank partners. When we purchase a loan from an originating bank partner, the purchase price is equal to the outstanding principal balance of the loan, plus a fee and any accrued interest. The originating bank partner also retains an interest in the loans purchased by us through a loan performance fee that is payable by us on the aggregate principal amount of a loan that is paid by a consumer. See Note 13. Fair Value of Financial Assets and Liabilities of the accompanying notes to our consolidated financial statements for more information on the performance fee liability.

Current wording

When a consumer applies for a loan through our platform, the loan is underwritten using our proprietary risk model. Once approved for the loan, the consumer then selects their preferred repayment option. A portion of these loans are funded and issued by our originating bank partners, which include Cross River Bank, an FDIC-insured New Jersey state-chartered bank, Celtic Bank, an FDIC-insured Utah state-chartered industrial bank, and Lead Bank, an FDIC-insured Missouri state-chartered bank. These partnerships allow us to benefit from our partners’ ability to originate loans under their banking licenses while complying with various federal, state, and other laws. Under this arrangement, we must comply with our originating bank partners' credit policies and underwriting procedures, and our originating bank partners maintain ultimate authority to decide whether to originate a loan or not. When an originating bank partner originates a loan, it funds the loan through its own funding sources and may subsequently offer and sell the loan to us. Pursuant to our agreements with these partners, we are obligated to purchase the loans facilitated through our platform that such partner offers us and our obligation is secured by cash deposits. To date, we have purchased all of the loans facilitated through our platform and originated by our originating bank partners. When we purchase a loan from an originating bank partner, the purchase price is equal to the outstanding principal balance of the loan, plus a fee and any accrued interest. The originating bank partner also retains an interest in the loans purchased by us through a loan performance fee that is payable by us on the aggregate principal amount of a loan that is paid by a consumer. Refer to Note 13. Fair Value of Financial Assets and Liabilities of the accompanying notes to our consolidated financial statements for more information on the performance fee liability.

Previous wording

We are also able to originate loans directly under our lending, servicing, and brokering licenses in Canada and across several states in the U.S. through our consolidated subsidiaries. We directly originated approximately $4.5 billion, or 17%, $3.7 billion, or 18%, and $3.3 billion, or 16% of loans for the years ended June 30, 2024, 2023 and 2022, respectively.

Current wording

We are also able to originate loans directly under our lending, servicing, and brokering licenses in Canada, the U.K., and across most states in the U.S. through ourconsolidated subsidiaries. We directly originated approximately $6.3 billion, or 17%, $4.5 billion, or 17%, and $3.7 billion, or 18% of loans for the years ended June 30, 2025, 2024 and 2023, respectively.

Previous wording

We act as the servicer on all loans that we originate directly or purchase from our originating bank partners and earn a servicing fee on loans we sell to our funding sources. In the normal course of business, we do not sell the servicing rights on any of the loans. To allow for flexible staffing to support overflow and seasonal traffic, we partner with several sub-servicers to manage consumer care, first priority collections, and third-party collections in accordance with our policies and procedures.

Current wording

We act as the servicer on all loans that we originate directly or purchase from our originating bank partners and earn a servicing fee on loans held by third parties, including bank partners prior to loan purchase and third-party loan buyers if subsequently sold as part of our funding strategy. In the normal course of business, we do not sell the servicing rights on any of the loans. To allow for flexible staffing to support overflow and seasonal traffic, we partner with several sub-servicers to manage consumer care, first priority collections, and third-party collections in accordance with our policies and procedures.

Previous wording

Our capital efficient funding model is integral to the success of our platform. As we scale the number of transactions on our network and grow GMV, we maintain a variety of funding relationships in order to support our network. Our diversified funding relationships include warehouse facilities, securitization trusts, forward flow arrangements, and partnerships with banks. Given the short duration and strong performance of our assets, funding can be recycled quickly, resulting in a high-velocity, capital efficient funding model. As of June 30, 2024 and June 30, 2023, our equity capital as a percentage of our total platform portfolio has remained relatively unchanged at 5%. The mix of on-balance sheet and off-balance sheet funding is a function of how we choose to allocate loan volume, which is determined by the economic arrangements and supply of capital available to us, both of which may also impact our results in any given period.

Current wording

Our capital efficient funding model is integral to the success of our platform. As we scale the number of transactions on our network and grow GMV, we maintain a variety of funding relationships in order to support our network. Our diversified funding relationships include warehouse facilities, securitization trusts, variable funding notes, forward flow arrangements, and partnerships with banks. Given the short duration and strong performance of our assets, funding can be recycled quickly, resulting in a high-velocity, capital efficient funding model. As of June 30, 2025 and June 30, 2024, our equity capital as a percentage of our total platform portfolio was 4% and 5%, respectively. The mix of on-balance sheet and off-balance sheet funding is a function of how we choose to allocate loan volume, which is determined by the economic arrangements and supply of capital available to us, both of which may also impact our results in any given period.

Previous wording

The shifts in merchant volumes and products offered in any period affect our operating results. These shifts impact GMV, revenue, our financial results, and our key operating metric performance for that period. Differences in loan product mix result in varying loan durations, APR, and mix of 0% APR and interest-bearing financings.

Current wording

The shifts in merchant volumes and products offered in any period affect our operating results. These shifts impact GMV, revenue, our financial results, and our key operating metric performance for that period. Differences in loan product mix result in varying loan terms, APRs, and payment frequencies.

Previous wording

Additionally, our commercial agreements with our platform partners, along with the growing repeat usage of our Pay-in-4 and Affirm Card offerings, are driving an increase in low AOV transactions. As a result, while we expect that transactions per active consumer may increase, revenue as a percentage of GMV may decline in the medium term to the extent that a greater portion of our GMV comes from Pay-in-4, Affirm Card and other low-AOV offerings.

Current wording

Additionally, our commercial agreements with our platform partners, the expansion of our consumer eligibility criteria, along with the growing repeat usage of our Affirm Card offerings, are driving an increase in low AOV transactions. As a result, while we expect that transactions per active consumer may increase, revenue as a percentage of GMV may decline in the medium term to the extent that a greater portion of our GMV comes from Affirm Card and other low-AOV offerings.

Previous wording

We regularly monitor the direct and indirect impacts of the current macroeconomic conditions on our business, financial condition, and results of operations. Starting in fiscal 2023, the macroeconomic environment began to present a number of challenges to our business. In response to continued inflationary pressure, the U.S. Federal Reserve rapidly raised the federal funds interest rate from March 2022 through July 2023, and there is no certainty as to whether and to what extent the federal funds interest rate will remain at current levels, increase or decrease in future periods. Simultaneously, economic uncertainty and the prospect of economic recession has impacted consumer spending. These challenges have affected, and may continue to affect, our business and results of operations in the following ways:

Current wording

We regularly monitor the direct and indirect impacts of the current macroeconomic conditions on our business, financial condition, and results of operations. Since 2022, the U.S. Federal Reserve has maintained an elevated federal funds interest rate. Despite the Federal Reserve’s decision to begin to decrease the federal funds interest rate in September 2024, uncertainty remains as to whether and to what extent the federal funds interest rate will remain at current levels, increase or decrease in future periods. Simultaneously, economic uncertainty and unpredictability, including the prospect of economic recession and the magnitude, duration and impact of tariffs on global trade, has impacted and may continue to impact consumer spending. These challenges have affected, and may continue to affect, our business and results of operations in the following ways:

Previous wording

•Volatile capital markets: During fiscal 2024, capital markets have shown improvement against recent periods, which has been evidenced by substantial additions across our funding channels due to our strong loan performance. However, despite these improvements, uncertainties remain in the macroeconomic environment, especially with regard to persistent inflation and the potential for increased unemployment rates. To address these uncertainties, we leverage our diverse funding channels and counterparties, which contribute to our resilience across various macroeconomic conditions and economic cycles.

Current wording

•Volatile capital markets: Since fiscal 2024, capital markets have shown improvement against recent periods, which has been evidenced by substantial additions across our funding channels due to our strong loan performance. However, despite these improvements, uncertainties remain in the macroeconomic environment, especially with regard to inflation, the prospect of recession, the magnitude, duration and impact of tariffs on global trade, and the potential for increased unemployment. To address these uncertainties, we leverage our diverse funding channels and counterparties, which contribute to our resilience across various macroeconomic conditions and economic cycles.

Previous wording

These loan modification programs also impact our delinquency rates, and such impact can vary over time. As disclosed in Note 4. Loans Held for Investment and Allowance for Credit Losses of the accompanying notes to our consolidated financial statements during the year ended June 30, 2024, we expanded the eligibility of our loan modification programs, which resulted in a modest benefit to delinquency rates for loans held for investment as of June 30, 2024. As we continue to evaluate the effectiveness of these programs, we may modify, expand, or contract the usage of these programs, which may impact our delinquency rates in future periods.

Current wording

These loan modification programs also impact our delinquency rates, and such impact can vary over time. As disclosed in Note 4. Loans Held for Investment and Allowance for Credit Losses in the notes to the consolidated financial statements, in fiscal 2024, we expanded the eligibility of our loan modification programs, which resulted in a modest benefit to delinquency rates for loans held for investment during that period. The volume of loan modifications during the fiscal year ended June 30, 2025 decreased compared to the fiscal year ended June 30, 2024. Loans modified during the fiscal years ended June 30, 2025 and 2024, represent 0.17% and 0.64%, respectively, of the outstanding principal balance of loans held on our balance sheet. Our reported delinquency and charge off rates include loans which have become past due or have charged off subsequent to modification. An unknown percentage of loans which have been modified and are current as of June 30, 2025 may become delinquent or charge off in the future. We continue to evaluate the effectiveness of these programs and may modify, expand, or contract their usage, which may affect the timing of reported delinquencies and charge offs in future periods.

Previous wording

We focus on several key operating metrics to measure the performance of our business and help determine our strategic direction. In addition to revenue, net loss, and other results under U.S. GAAP, the following tables set forth key operating metrics we use to evaluate our business.

Current wording

We focus on several key operating metrics to measure the performance of our business and help determine our strategic direction. In addition to revenue, net income (loss), and other results under U.S. GAAP, the following tables set forth key operating metrics we use to evaluate our business.

Previous wording

For the year ended June 30, 2024, GMV was $26.6 billion, an increase of approximately 32% from $20.2 billion for the year ended June 30, 2023, and an increase of approximately 72% from $15.5 billion for the year ended June 30, 2022. Overall, the increase in GMV was driven by an increase in volume at our top five merchants and platform partners as well as overall increases in our active merchant base, active consumers and average transactions per consumer. The increase in GMV for the year ended June 30, 2024 also reflected increased consumer demand at our largest merchant partners by GMV and increased consumer demand in our travel and ticketing, electronics and general merchandise categories.

Current wording

For the year ended June 30, 2025, GMV was $36.7 billion, which represented an increase of approximately 38% from $26.6 billion for the year ended June 30, 2024, and an increase of approximately 81% from $20.2 billion for the year ended June 30, 2023. Overall, the increase in GMV was driven by growth in several key areas including our top five merchants and platform partners, our direct to consumer products, including Affirm Card, and overall increases in our active merchant base, active consumers and average transactions per consumer.

Previous wording

GMV attributable to Amazon represented 21% of total GMV. For both the years ended June 30, 2023 and 2022, GMV attributable to Amazon represented less than 20% of total GMV.

Current wording

The top five merchants and platform partners as of June 30, 2025 and 2024 represented approximately 47% of total GMV. The top five merchants and platform partners as of June 30, 2023 represented approximated 42% of total GMV. For the years ended June 30, 2025, 2024, and 2023, GMV attributable to Amazon represented 22%, 21% and less than 20%, respectively, of total GMV.

Previous wording

We assess consumer adoption and engagement by the number of active consumers across our platform. Active consumers are the primary measure of the size of our network. We define an active consumer as a consumer who engages in at least one transaction on our platform during the 12 months prior to the measurement date.

Current wording

We assess consumer adoption and engagement by the number of active consumers across our platform. Active consumers are the primary measure of the size of our network. We define an active consumer as a consumer who completes at least one transaction on our platform during the 12 months prior to the measurement date.

Previous wording

As of June 30, 2024, we had approximately 18.7 million active consumers, which represented an increase of 14% compared to approximately 16.5 million as of June 30, 2023, and 34% compared to approximately 14.0 million as of June 30, 2022. The increase was primarily due to a high retention rate of existing consumers and the acquisition of new consumers through an expanding active merchant base, Affirm Card and platform partnerships.

Current wording

As of June 30, 2025, we had approximately 23.0 million active consumers, which represented an increase of 23% compared to approximately 18.7 million as of June 30, 2024, and 40% compared to approximately 16.5 million as of June 30, 2023. The increase was primarily due to a high retention rate of existing consumers, as well as continued adoption of the Affirm Card, and the acquisition of new consumers through an expansion in active merchants and platform partnerships.

Previous wording

As of June 30, 2024, we had approximately 4.9 transactions per active consumer, an increase of 26% compared to June 30, 2023 and an increase of 64% compared to June 30, 2022. The increase was primarily due to platform growth, a higher frequency of repeat users driven by consumer engagement and growth of Affirm Card active consumers. As of June 30, 2024, Affirm Card represented approximately 8% of the total number of transactions compared to approximately 2% as of June 30, 2023.

Current wording

As of June 30, 2025, we had approximately 5.8 transactions per active consumer, an increase of 20% compared to June 30, 2024 and an increase of 52% compared to June 30, 2023. The increase was primarily due to platform growth, a higher frequency of repeat users driven by consumer engagement, and growth of Affirm Card active consumers. As of June 30, 2025, Affirm Card represented approximately 10% of the total number of transactions compared to approximately 8% and 2% as of June 30, 2024 and 2023, respectively.

Previous wording

The following tables set forth selected consolidated statements of operations and comprehensive loss data for each of the periods presented:

Current wording

The following tables set forth selected consolidated statements of operations and comprehensive income (loss) data for each of the periods presented:

Previous wording

(1)Upon purchase of a loan from our originating bank partners at a price above the fair market value of the loan or upon the origination of a loan with a par value in excess of the fair market value of the loan, a discount is included in the amortized cost basis of the loan. For loans held for investment, this discount is amortized over the life of the loan into interest income. When a loan is sold to a third-party loan buyer or off-balance sheet securitization trust, the unamortized discount is released in full at the time of sale and recognized as part of the gain or loss on sales of loans. However, the cumulative value of the loss on loan purchase commitment or loss on origination, the interest income recognized over time from the amortization of discount while retained, and the release of discount into gain on sales of loans, together net to zero over the life of the loan. The following table details activity for the discount, included in loans held for investment, for the periods indicated:

Current wording

(1)Upon purchase of a loan from our originating bank partners at a price above the fair market value of the loan or upon the origination of a loan with a par value in excess of the fair market value of the loan, a discount is included in the amortized cost basis of the loan. For loans held for investment, this discount is amortized over the life of the loan into interest income. For loans held for sale, when a loan is sold to a third-party loan buyer or off-balance sheet securitization trust, the unamortized discount is released in full at the time of sale and recognized as part of the gain or loss on sales of loans. However, the cumulative value of the loss on loan purchase commitment or loss on origination, the interest income recognized over time from the amortization of discount while retained, and the release of discount into gain on sales of loans, together net to zero over the life of the loan. The following table details activity for the discount, included in loans held for investment, for the periods indicated:

Previous wording

Merchant network revenue for the year ended June 30, 2024 increased by $167.0 million, or 33%, compared to the same period in 2023. The increase is primarily attributed to an increase of $6.4 billion or 32% in GMV for the year ended June 30, 2024. GMV increased from $20.2 billion as of June 30, 2023 to $26.6 billion as of June 30, 2024. The increase in GMV is a result of continued growth at our top five merchants and platform partners representing approximately 47% and 42% as of June 30, 2024 and 2023, respectively, as well as growth in our active merchant base and active consumers, reaching approximately 303 thousand and 18.7 million, respectively, as of June 30, 2024, up from approximately 254 thousand and 16.5 million, respectively, as of June 30, 2023. Additionally, the average transactions per active consumer increased from 3.9 as of June 30, 2023 to 4.9 as of June 30, 2024. The increase in consumers and average transactions per active consumer is partially offset by a decrease in AOVs. For the year ended June 30, 2024 AOV was $292 down from $318 for the same period in fiscal 2023. The decrease in AOV is due to the diversification of our merchant base and our initiative to drive repeat usage of our platform beyond one-time high AOV purchases.

Current wording

Merchant network revenue for the year ended June 30, 2025 increased by $208.1 million, or 31%, compared to the same period in 2024. The increase is primarily attributed to an increase of $10.0 billion or 38% in GMV for the year ended June 30, 2025. GMV increased from $26.6 billion as of June 30, 2024 to $36.7 billion as of June 30, 2025. GMV from the top five merchants and platform partners as of June 30, 2025, increased 38% compared to the same period in 2024. Our active merchant base and the number of active consumers also grew, reaching approximately 377 thousand and 23.0 million, respectively, as of June 30, 2025, up from approximately 303 thousand and 18.7 million, respectively, as of June 30, 2024.

Previous wording

Card network revenue for the year ended June 30, 2024 increased by $32.1 million, or 27%, compared to the same period in 2023. Card network revenue growth is correlated with the growth of GMV processed by our issuer processors. As such, the increase is primarily driven by $8.2 billion of GMV processed through our issuer processors, an increase of 40% for the year ended June 30, 2024, as compared to the same period in 2023. This was driven by increased card activity through Affirm Card and our single use virtual debit cards, as well as growth in existing and new merchants utilizing our agreement with card-issuing partners as a means of integrating Affirm services, which grew from approximately 1,300 merchants as of June 30, 2023 to 1,900 merchants as of June 30, 2024. Card network revenue is also impacted by the mix of merchants as different merchants can have different interchange rates depending on their industry or size, among other factors.

Current wording

Card network revenue for the year ended June 30, 2025 increased by $79.9 million, or 53%, compared to the same period in 2024. Card network revenue growth is correlated with the growth of GMV processed by our issuer processors. As such, the increase is primarily driven by $11.9 billion of GMV processed through our issuer processors, an increase of 45% for the year ended June 30, 2025, as compared to the same period in 2024. This was driven by increased card activity through Affirm Card and our one-time-use virtual debit cards, as well as growth in existing and new merchants utilizing our agreement with card-issuing partners as a means of integrating Affirm services. Card network revenue is also impacted by the mix of merchants as different merchants can have different interchange rates depending on their industry or size, among other factors.

Previous wording

Interest income for the year ended June 30, 2024 increased by $519.1 million, or 76%, compared to the same period in 2023. Generally, interest income is correlated with the changes in the average balance of loans held for investment, which increased by 49% to $5.1 billion for the year ended June 30, 2024, compared to the same period in 2023. As a result, interest income from interest-bearing loans increased $481.8 million, or 86%, compared to the same period in 2023. This increase was partially due to an increase in the volume of interest bearing loans originated, which increased to 74% of total GMV for the year ended June 30, 2024, compared to 68% of total GMV in the same period in 2023, in addition to recent pricing initiatives, including the increase of the maximum APR and merchant-subsidized low APR loans replacing previously non-interest bearing loans.

Current wording

Interest income for the year ended June 30, 2025 increased by $403.9 million, or 34%, compared to the same period in 2024. Generally, interest income is correlated with the changes in the average balance of loans held for investment, which increased by 28% to $6.5 billion for the year ended June 30, 2025, compared to the same period in 2024. As a result, interest income from interest-bearing loans increased $380.4 million, or 36%, compared to the same period in 2024.

Previous wording

Gain on sales of loans for the year ended June 30, 2024 increased by $8.8 million, or 5%, compared to the same period in 2023. The increase was driven by an increase in loan sale volume to third-party loan buyers. We sold loans with an unpaid principal balance of $10.2 billion for the year ended June 30, 2024, compared to $7.5 billion for the year ended June 30, 2023.

Current wording

Gain on sales of loans for the year ended June 30, 2025 increased by $184.5 million, or 94%, compared to the same period in 2024. The increase is driven by higher loan sale volume to third-party loan buyers and favorable transaction economics which are impacted by the composition of our loan portfolio sold and other market factors. We sold loans with an unpaid principal balance of $15.8 billion for the year ended June 30, 2025, compared to $10.2 billion for the year ended June 30, 2024, an increase of 54%.

Previous wording

Servicing income for the year ended June 30, 2024 increased by $8.0 million, or 9%, compared to the same period in 2023. The increase was primarily due to an increase in net servicing fee revenue which is calculated as a percentage of the unpaid principal balance of loans owned by third-party loan owners. The average unpaid principal balance of loans owned by third-party loan owners increased from $4.5 billion during the year ended June 30, 2023 to $4.9 billion during the year ended June 30, 2024, an increase of 7%. The increase was partially offset by fair value adjustments related to servicing assets and liabilities, resulting in a $2.5 million lower gain during the year ended June 30, 2024, compared to the same period in 2023.

Current wording

Servicing income for the year ended June 30, 2025 increased by $25.1 million, or 26%, compared to the same period in 2024. The increase was primarily due to an increase in net servicing fee revenue which is calculated as a percentage of the unpaid principal balance of loans owned by third-party loan owners. The average unpaid principal balance of loans owned by third-party loan owners increased from $4.9 billion during the year ended June 30, 2024 to $6.6 billion during the year ended June 30, 2025, an increase of 36%.

Previous wording

We purchase certain loans from our originating bank partners that are processed through our platform and put back to us by our originating bank partners. Under the terms of the agreements with our originating bank partners, we are generally required to pay the principal amount plus accrued interest for such loans and fees. In certain instances, our originating bank partners may originate loans with zero or below market interest rates that we are required to purchase. In these instances, we may be required to purchase the loan for a price in excess of the fair market value of such loans, which results in a loss. These losses are recognized as loss on loan purchase commitment in our consolidated statements of operations and comprehensive loss. These costs are incurred on a per loan basis.

Current wording

We purchase certain loans from our originating bank partners that are processed through our platform and put back to us by our originating bank partners. Under the terms of the agreements with our originating bank partners, we are generally required to pay the principal amount plus accrued interest for such loans and fees. In certain instances, our originating bank partners may originate loans with zero or below market interest rates that we are required to purchase. In these instances, we may be required to purchase the loan for a price in excess of the fair market value of such loans, which results in a loss. These losses are recognized as loss on loan purchase commitment in our consolidated statements of operations and comprehensive income (loss). These costs are incurred on a per loan basis.

Previous wording

Loss on loan purchase commitment for the year ended June 30, 2024 increased by $40.1 million, or 29%, compared to the same period in 2023, primarily due to an increase in total loans purchased. During the year ended June 30, 2024, we purchased $21.5 billion of loans from our originating bank partners, compared to $16.2 billion in the same period in 2023, representing an increase of 33%.Additionally, discount rate assumption used to calculate the fair market value of loans increased during the period, which contributed to higher losses on loan purchase commitments.

Current wording

Loss on loan purchase commitment for the year ended June 30, 2025 increased by $61.9 million, or 34%, compared to the same period in 2024, primarily due to an increase in total volume of loans purchased. During the year ended June 30, 2025, we purchased $30.0 billion of loans from our originating bank partners, compared to $21.5 billion in the same period in 2024, representing an increase of 40%. Additionally, 0% APR installment loans represented $4.4 billion of the total loans purchased during the year ended June 30, 2025, an increase of 65% compared to the same period in 2024.

Previous wording

Provision for credit losses generally represents the amount of expense required to maintain the allowance for credit losses on our consolidated balance sheet, which represents management’s estimate of future losses. In the event that our loans outperform expectation and/or we reduce our expectation of credit losses in future periods, we may release reserves and thereby reduce the allowance for credit losses, yielding income in the provision for credit losses. The provision is determined based on our estimate of expected future losses on loans originated during the period and held for investment on our balance sheet, changes in our estimate of future losses on loans outstanding as of the end of the period and the net charge-offs incurred in the period.

Current wording

Provision for credit losses generally represents the amount of expense required to maintain the allowance for credit losses within our consolidated balance sheet, which represents management’s estimate of future losses. In the event that our loans outperform expectation and/or we reduce our expectation of credit losses in future periods, we may release reserves and thereby reduce the allowance for credit losses, yielding income in the provision for credit losses. The provision is determined based on our estimate of expected future losses on loans originated during the period and held for investment on our balance sheet, changes in our estimate of future losses on loans outstanding as of the end of the period and the net charge-offs incurred in the period.

Previous wording

Provision for credit losses increased by $128.8 million, or 39%, for the year ended June 30, 2024 compared to the same period in 2023, driven by growth in the volume of loans held for investment. Loans held for investment as of June 30, 2024 was $5.7 billion, an increase of $1.3 billion, or 29% as compared to the same period in 2023. The allowance for credit losses as a percentage of loans held for investment increased from 4.6% as of June 30, 2023 to 5.5% as of June 30, 2024. The increase in the allowance rate from June 30, 2023 is primarily driven by an increase in loans held on our balance sheet as well as adjustments in our credit criteria in light of increasing interest income generated by our loans and changes in the loan mix.

Current wording

Provision for credit losses increased by $156.1 million, or 34%, for the year ended June 30, 2025 compared to the same period in 2024, primarily driven by growth in the volume of loans held for investment. For the year ended June 30, 2025, the average balance of loans held for investment was $6.5 billion, an increase of $1.4 billion, or 28%, as compared to the same period in 2024. The allowance for credit losses as a percentage of loans held for investment increased from 5.5% as of June 30, 2024 to 5.6% as of June 30, 2025. The increase in the allowance rate year over year is primarily driven by an increase in loans held on our balance sheet as well as a change in the loan mix when compared to June 30, 2024, in line with expected credit performance.

Previous wording

Funding costs for the year ended June 30, 2024 increased by $161.2 million or 88%, compared to the same period in 2023. The increase was primarily due to higher benchmark interest rates and an increase of funding debt and notes issued by securitization trusts during the year ended June 30, 2024. The average total of funding debt from warehouses and securitizations for the year ended June 30, 2024 was $4.5 billion compared to $2.5 billion during the same period in 2023, an increase of $2.0 billion, or 81%. The increase was also attributable to a larger volume of on-balance sheet loans being retained during the period. The average on-balance sheet loan balance was $5.1 billion for the year ended June 30, 2024, respectively, an increase of 49% compared to$3.4 billion during the same periods in 2023, respectively.

Current wording

Funding costs for the year ended June 30, 2025 increased by $81.2 million or 24%, compared to the same period in 2024. The increase was primarily due to an increase of funding debt and notes issued by securitization trusts during the year ended June 30, 2025. The average total of funding debt from warehouses and securitizations for the year ended June 30, 2025 was $5.9 billion compared to $4.5 billion during the same period in 2024, an increase of $1.4 billion, or 30%. The increase was also attributable to a larger volume of on-balance sheet loans being retained during the period. The average on-balance sheet loan balance was $6.5 billion for the year ended June 30, 2025, respectively, an increase of 28% compared to $5.1 billion during the same period in 2024.

Previous wording

Processing and servicing expense for the year ended June 30, 2024 increased by $85.9 million, or 33%, compared to the same period in 2023. This increase was primarily driven by an increase in payment processing fees of $55.4 million, or 41%, related to increased payment volume for the year ended June 30, 2024. Additionally, our platform fees increased by $37.5 million, or 91%, for the year ended June 30, 2024 due to an increase in our volume with a large enterprise partner. The increase was partially offset by a $7.6 million, or 34%, decrease in personnel-related costs, for the year ended June 30, 2024 compared to the same period in 2023 as a result of our reduction in force and cost management plans.

Current wording

Processing and servicing expense for the year ended June 30, 2025 increased by $114.6 million, or 33%, compared to the same period in 2024. This increase was primarily driven by an increase in payment processing fees of $69.5 million, or 36%, related to an increase of $8.6 billion, or 36%, in payment volume for the year ended June 30, 2025, compared to the same period in 2024. During the year ended June 30, 2025, our platform fees increased by $29.3 million, or 37%, due to an increase in volume with a large enterprise partner. Additionally, our customer service and collection fee costs increased by $22.5 million, or 47%, compared to the same period in 2024. This is driven by growth in our overall loan portfolio, including both loans held for investment and loans serviced for third parties, due to the increase in the number of consumer transactions. The number of consumer transactions increased by 47% during the year ended June 30, 2025, from continued growth at our merchants and platform partners. The increase was partially offset by a $8.9 million, or 60%, decrease in personnel-related costs, for the year ended June 30, 2025, compared to the same period in 2024, as a result of our reduction in force and cost management plans.

Previous wording

Technology and data analytics expense for the year ended June 30, 2024 decreased by $114.0 million or 19%, compared to the same period in 2023. The decrease is primarily driven by a decrease of $138.1 million, or 39%, in stock-based compensation and payroll and personnel-related costs for the year ended June 30, 2024, compared to the same period in 2023, due to higher capitalized compensation costs related to internally-developed software and a reduction in force. Additionally, data infrastructure and hosting costs decreased by $26.0 million, or 23%, for the year ended June 30, 2024 compared to the same period in 2023, due to cost optimization initiatives as a result of improved contractual terms with several key vendors. The decrease is partially offset by amortization of internally-developed software which increased by $44.0 million, or 40%, for the year ended June 30, 2024 compared to the same period in 2023, as a result of an increase in the number of capitalized projects. Capitalized projects grew by 36% from approximately 660 projects as of June 30, 2023 to 890 projects as of June 30, 2024.

Current wording

Technology and data analytics expense for the year ended June 30, 2025 increased by $87.9 million or 18%, compared to the same period in 2024. The increase is primarily driven by amortization of internally-developed software which increased by $64.3 million, or 42%, for the year ended June 30, 2025, compared to the same period in 2024, as a result of an increase in the number of capitalized projects. Capitalized projects in service grew by 78% from approximately 830 projects as of June 30, 2024 to 1,470 projects as of June 30, 2025. Data infrastructure and hosting costs increased by $24.6 million, or 29%, for the year ended June 30, 2025, compared to the same period in 2024, due to a 47% increase in consumer transactions as a result of continued growth at our merchants and platform partners.

Previous wording

Sales and marketing costs consist of the expense related to warrants and other share-based payments granted to our enterprise partners, salaries and personnel-related costs, costs of marketing and promotional activities.

Current wording

Sales and marketing costs consist of the expense related to warrants and other share-based payments granted to our enterprise partners, salaries and personnel-related costs, and costs of marketing and promotional activities.

Previous wording

Sales and marketing expense for the year ended June 30, 2024 decreased by $61.9 million or 10%, compared to the same period in 2023. The decrease was primarily driven by a decrease of $26.0 million, or 37%, in payroll and personnel-related costs during the year ended June 30, 2024 compared to the same period in 2023, as a result of our reduction in force and cost management plans. Amazon warrant expense decreased by $23.7 million, or 5%, during the year ended June 30, 2024 compared to the same period in 2023, primarily due to the renewal of the commercial partnership agreement in February 2024, which extended the amortization period of the commercial agreement asset, as well as a decrease in the number of new users to the Amazon program during the year ended June 30, 2024, which is the basis for a portion of the warrant expense. Additionally, amortization of intangible assets decreased by $8.1 million, or 46%, for the year ended June 30, 2024 compared to the same period in 2023, as a result of one-time acceleration of amortization of Returnly’s intangibles assets related to the wind down of our returns management platform during fiscal 2023.

Current wording

Sales and marketing expense for the year ended June 30, 2025 decreased by $141.6 million or 25%, compared to the same period in 2024. The decrease was primarily driven by a $135.2 million, or 33%, decrease in Amazon warrant expense during the year ended June 30, 2025, compared to the same period in 2024, primarily due to a portion of the warrants becoming fully vested as of December 2024. Additionally, amortization expense related to the Amazon commercial agreement decreased by $12.2 million, or 37%, during the year ended June 30, 2025, compared to the same period in 2024, primarily due to the renewal of the commercial partnership agreement in February 2024, which extended the amortization period of the commercial agreement asset.

Previous wording

Other income, net includes interest earned on our money market funds included in cash and cash equivalents and restricted cash, interest earned on securities available for sale, impairment or other adjustments to the cost basis of non-marketable equity securities held as cost, gains and losses on derivative agreements not designated within a hedging relationship, amortization of convertible debt issuance cost as well as gains (losses) on extinguishment, revolving credit facility issuance costs, fair value adjustments related to contingent liabilities, and other income or expense arising from activities that are unrelated to our primary business.

Current wording

Other income, net includes interest earned on our money market funds included in cash and cash equivalents and restricted cash, interest earned on securities available for sale, impairment or other adjustments to the cost basis of equity securities held as cost, gains and losses on derivative agreements not designated within a hedging relationship, amortization of convertible debt issuance cost as well as gains (losses) on extinguishment, revolving credit facility issuance costs, fair value adjustments related to contingent liabilities, and other income or expense arising from activities that are unrelated to our primary business.

Previous wording

The income tax expense / (benefit) for the year ended June 30, 2024 of $2.2 million changed from $(3.9) million for the same period in 2023, an overall increase to income tax expense (or decrease to income tax benefit) of $6.1 million, or 157%. This increase to income tax expense (decrease of income tax benefit) was primarily attributable to the increase in pretax book income in certain foreign jurisdictions for the year ended June 30, 2024 and its related income tax effects, whereas the income tax benefit recognized for the year ended June 30, 2023 was primarily attributable to the income tax effects of pretax book losses for that period in the same foreign jurisdictions.

Current wording

The income tax expense/(benefit) for the year ended June 30, 2025 of $9.3 million changed from $2.2 million for the same period in 2024, an overall increase to income tax expense of $7.0 million, or 316%. This increase to income tax expense was primarily attributable to the increase in pretax book income in certain foreign jurisdictions for the year ended June 30, 2025 and its related income tax effects when compared with the same period in 2024.

Previous wording

Our principal sources of liquidity are cash and cash equivalents, available for sale securities, available capacity from warehouse and revolving credit facilities, securitization trusts, forward flow loan sale arrangements, and certain cash flows from our operations. As of June 30, 2024, we had $2.1 billion in cash and cash equivalents and available for sale securities, $3.8 billion in available funding debt capacity, excluding our purchase commitments from third-party loan buyers, and $330 million in borrowing capacity available under our revolving credit facility. We believe our principal sources of liquidity are sufficient to meet both our existing operating, working capital, and capital expenditure requirements and our currently planned growth for at least the next 12 months.

Current wording

Our principal sources of liquidity are cash and cash equivalents, available for sale securities, available capacity from warehouse and revolving credit facilities, securitization trusts, forward flow loan sale arrangements, and certain cash flows from our operations. As of June 30, 2025, we had $2.2 billion in cash and cash equivalents and available for sale securities, $5.2 billion in available funding debt capacity, excluding our purchase commitments from third-party loan buyers, and $330.0 million in borrowing capacity available under our revolving credit facility. We believe our principal sources of liquidity are sufficient to meet both our existing operating, working capital, and capital expenditure requirements and our currently planned growth for at least the next 12 months.