Earnings Call Insights: Affirm Holdings, Inc. (AFRM) Q2 2026
Management View
- Max Levchin, Founder, CEO & Chairman, described the results as “excellent once again” and announced an upcoming investor forum on May 12, where the company will discuss “commercial and product initiatives and update our medium-term financial framework.”
- Levchin highlighted the growth of Affirm’s Card product, noting “GMV year-over-year for the quarter we’re reporting was up just under 160%. Active cardholders went up 121%. 0% deals on the Card went up 190% year-over-year.”
- Levchin also referenced Affirm’s diversification, stating “the business is growing quite well, and we’re quite happy with the diversification…that we see in the GMV.”
- Robert O’Hare, Chief Financial Officer, commented on merchant concentration, explaining “the top 5 that we disclosed for Q2 of FY ’26 is actually a different subset of merchants that we’re comparing to in fiscal ’25 in the same period…we have a new top 5 as a result of” a major partner transition.
- O’Hare spoke on RLTC (revenue less transaction cost) margins: “we do expect to see RLTC take rates that are slightly above 4%. I think that’s true in both Q3 and Q4 in the guidance that we provided.”
Outlook
- Affirm’s management guided to GMV growth of 30% in the third quarter and 25% in the fourth quarter, with Levchin stating, “you’re kind of pointing to a slowdown in GMV growth to 30% in the third, 25% in the fourth quarter…No specific call-outs. I mean, we are obviously comping the transition with a large retail partner.”
- O’Hare confirmed RLTC take rates “slightly above 4%” for both Q3 and Q4.
- Levchin indicated ongoing expansion in the U.K. and plans for more countries ahead, reinforcing that “both international and the card are still significant drivers.”
Financial Results
- O’Hare highlighted the recent ABS deal: “The last deal we just priced was done with a spread of under 100 basis points. It’s really remarkable. We haven’t done that since 2021. And the weighted-average yield on the deal was below 4.6%.”
- Levchin stated that the “other” GMV category now represents 15% of total GMV and is “growing triple digits.”
- The company emphasized strong merchant and cardholder growth, with wallet partnerships driving an inflection in active merchant growth.
Q&A
- Andrew Jeffrey, William Blair: Asked if business is widening beyond top merchants. Levchin deferred to O’Hare, who said the top 5 merchants list changed due to a large partner transition and that diversification is increasing.
- Ramsey El-Assal, Cantor Fitzgerald: Inquired about consumer and credit trends. Levchin responded, “the consumer we see to date is quite healthy…we feel pretty good about both the demand and the ability and willingness to repay.”
- William Nance, Goldman Sachs: Questioned RLTC margin trajectory. O’Hare: “the take rates and the dynamics will be pretty similar to what we saw from a trend perspective in Q2…we are seeing really nice benefits on the transaction cost with funding costs being the clearest example.”
- Jason Kupferberg, Wells Fargo: Asked about competitive impacts. Levchin said, “we saw no effect in the sort of some of the more ultra-aggressive…offers, but we did not see any [indiscernible].”
- Multiple analysts focused on the Affirm Card, international growth, funding markets, regulatory environment, and new product initiatives including AI-driven Boost AI and partnerships such as Intuit/QuickBooks.
Sentiment Analysis
- Analysts were generally positive but pressed on sustainability of growth, competitive pressures, funding, and the margin outlook. Questions were detailed and forward-focused, indicating engagement but also some skepticism about deceleration in growth rates and margin trends.
- Management’s tone was confident and upbeat, with Levchin repeatedly referring to strong metrics and O’Hare emphasizing robust execution in capital markets. Levchin used phrases such as “super excited about the product” and “we are absolutely very attentive,” reflecting optimism and focus on execution.
- Compared to the previous quarter, management’s tone remained positive, but analysts displayed slightly more caution regarding future growth rates and funding dynamics.
Quarter-over-Quarter Comparison
- The Q2 2026 call featured continued focus on the Affirm Card and international expansion, with much larger year-over-year growth figures for the Card product than in Q1.
- GMV growth guidance for Q3 and Q4 was discussed in this quarter, with explicit percentages, whereas the previous quarter focused more on explaining the revenue mix and margin targets.
- Both quarters highlighted strong capital markets execution, but Q2 provided more detail on recent ABS spreads and yields.
- Management’s tone was consistently upbeat both quarters, but Q2 saw more discussion of product innovation (AI, Boost, Intuit partnership) and regulatory strategy (bank charter application).
- Analysts shifted their focus from the Amazon agreement (Q1) to merchant diversification, product mix, and the effects of wallet partnerships and new verticals in Q2.
Risks and Concerns
- Levchin noted ongoing regulatory scrutiny and emphasized Affirm’s proactive approach, stating, “we are all regulated, always regulated by 51 distinct entities, federal and 50 states, and that’s part of the job.”
- Management addressed competitive pressures, but stated, “we saw no effect” on merchant pricing from aggressive competitor promotions.
- Questions about credit risk and loss provisions were met with reassurances about healthy consumer behavior and stable credit quality.
- The company discussed the small-scale nature of its rent vertical test, emphasizing limited exposure and deliberate underwriting.
Final Takeaway
Affirm management highlighted robust growth in its Card product, increasing diversification across merchants and verticals, and significant progress in international markets, especially the U.K. The company signaled ongoing innovation through AI-driven product enhancements and new partnerships, while maintaining a strong capital markets position and managing regulatory complexity. Management expects GMV growth of 30% in Q3 and 25% in Q4, with RLTC take rates slightly above 4%, positioning the company for continued expansion even as it navigates a changing environment and transitions with major partners.