Affirm Stock Soars on Record Profitability and Strong Growth Outlook

Affirm Holdings (AFRM) shares surged in trading after the buy now, pay later company reported record quarterly profits that far exceeded Wall Street expectations. The strong financial results and an optimistic forecast for the upcoming fiscal year prompted a wave of positive analyst revisions, fueling the stock's rally in an otherwise subdued market.

Earnings Beat Drives Rally

For its fiscal fourth quarter of 2026, Affirm reported earnings per share of $4.62, crushing the consensus analyst forecast of $0.85, according to Investing.com. Revenue for the quarter also topped expectations, coming in at $1.17 billion against a forecast of $1.11 billion. The company described the period as its most profitable ever, even when excluding a one-time deferred tax asset valuation allowance release that boosted the final earnings figure.

Key growth metrics underscored the strong performance, which the company noted was its 11th consecutive quarter of at least 30% GMV growth:

• Gross Merchandise Volume (GMV) climbed 36% year-over-year to $14.1 billion.
• Active consumers rose 21% to 27.8 million.
• Transactions per active consumer increased 20% to 7.0.

Analysts Raise Targets on Strong Outlook

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The company's robust forward guidance provided an additional catalyst for the stock. Affirm management projected a fiscal year 2027 GMV of more than $64 billion, which implies at least 27% growth from the fiscal 2026 total of approximately $50.2 billion.

In response to the strong results and outlook, several Wall Street firms raised their price targets on Affirm's stock. UBS lifted its target to $90 from $82, Bank of America increased its target to $93 from $88 while maintaining a Buy rating, and Citizens reiterated a Market Outperform rating with an $85 target, per Investing.com.

Market Context

Affirm's significant gains stood in stark contrast to the broader market, which traded mostly flat as investors awaited a keynote address from Federal Reserve Chair Kevin Warsh at the Jackson Hole Economic Policy Symposium. With major indices like the S&P 500 and Nasdaq showing little direction, Affirm's rally was driven entirely by its strong company-specific news, allowing it to stand out as a top performer.