Affirm Holdings, Inc. (NASDAQ:AFRM) ("Affirm" or the "Company"), the payment network that empowers consumers and helps merchants drive growth, today reported financial results for its fourth quarter and fiscal year ended June 30, 2021.
"Affirm's strong results this quarter and fiscal year demonstrate the progress we are making in rapidly expanding our network," said Max Levchin, Founder and Chief Executive Officer of Affirm. "More consumers and merchants are continuing to choose Affirm because of our ability to offer a variety of ways to pay, thanks to our unrivaled technology. During the fourth quarter, we increased the number of merchants on our platform by more than fivefold, more than doubled gross merchandise volume and grew active consumers by 97% year over year."
Levchin continued, "The secular shift toward flexible and transparent financial products continues to accelerate. With our superior technology, Affirm is strongly positioned to build a more valuable two-sided network for consumers and merchants. We remain focused on extending our leadership position with our core products, while capitalizing on our vast opportunities to empower more people with the new ones we continue to launch."
Fourth Quarter and Fiscal Year 2021 Operating Highlights:
All comparisons are made versus the same period in fiscal year 2020 unless otherwise stated.
Fourth Quarter of Fiscal Year 2021 Financial Highlights:1
All comparisons are made versus the same period in fiscal year 2020 unless otherwise stated.
Fiscal Year 2021 Financial Highlights:1
All comparisons are made versus fiscal year 2020 unless otherwise stated.
Recent Business Highlights
"We delivered another set of excellent results to close out our fiscal year with GMV and revenue growth continuing to accelerate," said Michael Linford, CFO of Affirm. "During the fourth quarter, we delivered strong unit economics while driving even greater capital efficiency. The strategic progress we achieved in fiscal year 2021 sets us up for long-term growth. We have never been more confident and excited in Affirm's future."
Financial Outlook
The following table summarizes Affirm's financial outlook for the first quarter and fiscal year 2022 periods.
|
|
Fiscal Q1 2022 |
|
Fiscal Year 2022 |
GMV |
|
$2.42 to $2.52 billion |
|
$12.45 to $12.75 billion |
Revenue |
|
$240 to $250 million |
|
$1,160 to $1,190 million |
Transaction Costs |
|
$145 to $150 million |
|
$605 to $620 million |
Revenue Less Transaction Costs |
|
$95 to $100 million |
|
$555 to $570 million |
Adjusted Operating Loss2 |
|
$(68) to $(63) million |
|
$(145) to $(135) million |
Weighted Average Shares Outstanding |
|
275 million |
|
290 million |
Affirm's financial outlook assumes the following for GMV and revenue:
In fiscal year 2022, Affirm expects GMV to grow faster than revenue as the Company's GMV mix shifts toward shorter duration Split Pay volume, and the volume coming from longer-duration Peloton financing de-concentrates.
Affirm's fiscal year 2022 financial outlook also reflects its strategy to drive growth in its network through continued investment in product as well as merchant and consumer acquisition and retention efforts. The Company is intentionally prioritizing increased investments in both its product and engineering teams, while also increasing its brand and direct response marketing efforts. These investments are expected to benefit the Company's product innovation capabilities and brand awareness in support of its long-term growth objectives.
Conference Call
Affirm will host a conference call and webcast to discuss fourth quarter fiscal year 2021 financial results on Thursday, September 9, 2021, at 5:00 pm ET. Hosting the call will be Max Levchin, Founder and Chief Executive Officer, and Michael Linford, Chief Financial Officer. The conference call will be webcast live from the Company's investor relations website at https://investors.affirm.com/. A replay will be available on the investor relations website following the call.
Investor Forum
Affirm will also hold a virtual event after the close of market on September 28, 2021 to provide an update on its strategic, financial and product initiatives. The event will feature keynote presentations by Max Levchin, Founder and Chief Executive Officer, and Michael Linford, Chief Financial Officer, and Q&A sessions with Mr. Levchin, Mr. Linford and additional members of its executive leadership team. The event will be webcast from Affirm's investor relations website at https://investors.affirm.com/ and a replay will be available following the event.
Key Operating Metrics, Non-GAAP Financial Measures and Supplemental Performance Indicators
|
Three Months Ended June 30, |
|
Year Ended June 30, |
|||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|||||||||
|
(in millions, except GMV and percent data) (unaudited) |
|||||||||||||||
GMV (in billions) |
$ |
2.5 |
|
$ |
1.2 |
|
$ |
8.3 |
|
$ |
4.6 |
|
||||
Total Revenue, net |
$ |
261.8 |
|
$ |
153.3 |
|
$ |
870.5 |
|
$ |
509.5 |
|
||||
Total Revenue as a % of GMV |
10.5 |
% |
12.7 |
% |
10.5 |
% |
11.0 |
% |
||||||||
Transaction Costs (Non-GAAP) |
$ |
114.0 |
|
$ |
45.8 |
|
$ |
439.0 |
|
$ |
348.7 |
|
||||
Transaction Costs as a % of GMV |
4.6 |
% |
3.8 |
% |
5.3 |
% |
7.5 |
% |
||||||||
Revenue Less Transaction Costs (Non-GAAP) |
$ |
147.7 |
|
$ |
107.6 |
|
$ |
431.4 |
|
$ |
160.9 |
|
||||
Revenue Less Transaction Costs as a % of GMV (Non-GAAP) |
5.9 |
% |
8.9 |
% |
5.2 |
% |
3.5 |
% |
||||||||
Operating (Loss) Income |
$ |
(124.7 |
) |
$ |
39.3 |
|
$ |
(379.2 |
) |
$ |
(107.8 |
) |
||||
Operating Margin |
(47.6 |
)% |
25.6 |
% |
(43.6 |
)% |
(21.2 |
)% |
||||||||
Adjusted Operating Income (Loss) (Non-GAAP) |
$ |
14.2 |
|
$ |
46.7 |
|
$ |
14.3 |
|
$ |
(68.3 |
) |
||||
Adjusted Operating Margin (Non-GAAP) |
5.4 |
% |
30.5 |
% |
1.6 |
% |
(13.4 |
)% |
||||||||
Net (Loss) Income |
$ |
(128.2 |
) |
$ |
34.8 |
|
$ |
(430.9 |
) |
$ |
(112.6 |
) |
|
|
June 30, 2021 |
|
June 30, 2020 |
|
June 30, 2019 |
||||||
|
|
(unaudited) |
||||||||||
Active Consumers (in millions) |
|
7.1 |
|
|
3.6 |
|
|
2.0 |
|
|||
Transactions per Active Consumer |
|
2.3 |
|
|
2.1 |
|
|
2.0 |
|
|||
Active Merchants (in thousands) |
|
29.0 |
|
|
5.7 |
|
|
3.1 |
|
|||
Total Platform Portfolio (Non-GAAP) (in billions) |
|
$ |
4.7 |
|
|
$ |
2.5 |
|
|
$ |
1.4 |
|
Equity Capital Required (Non-GAAP) (in millions) |
|
$ |
178.1 |
|
|
$ |
220.8 |
|
|
$ |
169.6 |
|
Equity Capital Required as a % of Total Platform Portfolio (Non-GAAP) |
|
3.8 |
% |
|
8.9 |
% |
|
12.0 |
% |
|||
Allowance for Credit Losses as a % of Loans Held for Investment |
|
5.8 |
% |
|
9.2 |
% |
|
9.0 |
% |
Key Operating Metrics
Non-GAAP Financial Measures
Supplemental Performance Indicators
Use of Non-GAAP Financial Measures
To supplement the Company's condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States ("GAAP"), the Company presents the following non-GAAP financial measures: transaction costs, transaction costs as a percentage of GMV, revenue less transaction costs, revenue less transaction costs as a percentage of GMV, adjusted operating (loss) income, adjusted operating margin, total platform portfolio, equity capital required, and equity capital required as a percentage of total platform portfolio. Definitions of these non-GAAP financial measures are included under "Key Operating Metrics, Non-GAAP Financial Measures and Supplemental Performance Indicators" above, and reconciliations of these non-GAAP financial measures with the most directly comparable GAAP financial measures are included in the tables below.
Summaries of the reasons why the Company believes that the presentation of each of these non-GAAP financial measures provides useful information to the Company and investors are included under "Key Operating Metrics, Non-GAAP Financial Measures and Supplemental Performance Indicators" above. In addition, the Company uses these non-GAAP financial measures in conjunction with financial measures prepared in accordance with GAAP for planning purposes, including the preparation of its annual operating budget, and for evaluating the effectiveness of its business strategy. However, these non-GAAP financial measures are presented for supplemental informational purposes only, and these non-GAAP financial measures have limitations as analytical tools. Some of these limitations are as follows:
Accordingly, investors should not consider these non-GAAP financial measures in isolation or as substitutes for analysis of the Company's financial results as reported under GAAP, and these non-GAAP measures should be considered along with other operating and financial performance measures presented in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures and not rely on any single financial measure to evaluate the business.
Cautionary Note About Forward-Looking Statements
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. All statements other than statements of historical fact are forward-looking statements, including statements regarding: the Company's strategy and future operations, including the Company's partnerships with Amazon and Shopify; the development, innovation, introduction and performance of the Company's products, including the Debit+ Card; acquisition and retention of merchants and consumers; the Company's future growth, investments, network expansion, product mix, brand awareness, financial position, gross market value, revenue, transaction costs, operating income, provision for credit losses, and cash flows; and general economic trends and trends in the Company's industry and markets. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
Risks, uncertainties and assumptions include factors relating to: the Company's need to attract additional merchants and consumers and retain and grow its relationships with existing merchants and consumers; its need to maintain a consistently high level of consumer satisfaction and trust in its brand; the concentration of a large percentage of its revenue with a single merchant partner; its ability to sustain its revenue growth rate or the growth rate of its related key operating metrics; the highly competitive nature of its industry; the terms of its agreement with one of its originating bank partners; its existing funding arrangements that may not be renewed or replaced or its existing funding sources that may be unwilling or unable to provide funding to it on terms acceptable to it, or at all; its ability to effectively underwrite loans facilitated through its platform and accurately price credit risk; the performance of loans facilitated through its platform; changes in market interest rates; its securitizations, warehouse credit facilities and forward flow agreements; the impact on its business of general economic conditions, the financial performance of its merchants, and fluctuations in the U.S. consumer credit market; its ability to grow effectively through acquisitions or other strategic investments or alliances; and other risks that are described in its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021 and in its other filings with the U.S. Securities and Exchange Commission.
These forward-looking statements reflect the Company's views with respect to future events as of the date hereof and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, you should not place undue reliance on these forward-looking statements. The forward-looking statements are made as of the date hereof, and the Company assumes no obligation and does not intend to update these forward-looking statements.
About Affirm
Affirm's mission is to deliver honest financial products that improve lives. By building a new kind of payment network ? one based on trust, transparency and putting people first ? we empower millions of consumers to spend and save responsibly, and give thousands of businesses the tools to fuel growth. Unlike credit cards and other pay-over-time options, we show consumers exactly what they will pay up front, never increase that amount, and never charge any late or hidden fees.
AFRM-F
AFFIRM HOLDINGS, INC. |
||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(Unaudited) |
||||||||
(in thousands, except share and per share amounts) |
||||||||
|
|
June 30, 2021 |
|
June 30, 2020 |
||||
Assets |
? |
? |
? |
? |
||||
Cash and cash equivalents |
|
$ |
1,466,558 |
|
|
$ |
267,059 |
|
Restricted cash |
|
226,074 |
|
|
61,069 |
|
||
Loans held for sale |
|
13,030 |
|
|
4,459 |
|
||
Loans held for investment |
|
2,022,320 |
|
|
1,034,312 |
|
||
Allowance for credit losses |
|
(117,760 |
) |
|
(95,137 |
) |
||
Loans held for investment, net |
|
1,904,560 |
|
|
939,175 |
|
||
Accounts receivable, net |
|
91,575 |
|
|
59,001 |
|
||
Securitization notes receivable and residual certificates (at fair value) |
|
16,170 |
|
|
? |
|
||
Property, equipment and software, net |
|
62,499 |
|
|
48,140 |
|
||
Goodwill |
|
516,515 |
|
|
1,255 |
|
||
Intangible assets |
|
67,930 |
|
|
2,496 |
|
||
Commercial agreement assets |
|
227,377 |
|
|
? |
|
||
Other assets |
|
274,679 |
|
|
19,597 |
|
||
Total Assets |
? |
$ |
4,866,967 |
|
|
$ |
1,402,251 |
|
Liabilities, Redeemable Convertible Preferred Stock and Stockholders' Deficit |
? |
|
|
|
||||
Liabilities: |
? |
|
|
|
||||
Accounts payable |
|
$ |
57,758 |
|
|
$ |
18,361 |
|
Payable to third-party loan owners |
|
50,079 |
|
|
24,998 |
|
||
Accrued interest payable |
|
2,751 |
|
|
1,860 |
|
||
Accrued expenses and other liabilities |
|
317,951 |
|
|
27,810 |
|
||
Convertible debt |
|
? |
|
|
74,222 |
|
||
Notes issued by securitization trusts |
|
1,176,673 |
|
|
? |
|
||
Funding debt |
|
680,602 |
|
|
817,926 |
|
||
Total liabilities |
? |
2,285,814 |
|
|
965,177 |
|
||
Redeemable convertible preferred stock, $0.00001 par value, 30,000,000 and 124,453,009 shares authorized as of June 30, 2021 and June 30, 2020, respectively; zero and 122,115,971 shares issued and outstanding as of June 30, 2021 and June 30, 2020, respectively; liquidation preference of $0 and $809,032 as of June 30, 2021 and June 30, 2020, respectively |
? |
? |
|
|
804,170 |
|
||
Stockholders' deficit: |
? |
|
|
|
||||
Common stock, $0.00001 par value, no shares authorized, issued and outstanding at June 30, 2021; 232,000,000 shares authorized, 47,684,427 shares issued and outstanding as of June 30, 2020 |
? |
? |
|
|
? |
|
||
Class A common stock, par value $0.00001 per share: 3,030,000,000 shares authorized, 181,131,728 shares issued and outstanding as of June 30, 2021; no shares authorized, issued and outstanding as of June 30, 2020 |
? |
2 |
|
|
? |
|
||
Class B common stock, par value $0.00001 per share: 88,226,376 shares authorized, issued and outstanding as of June 30, 2021; no shares authorized, no shares issued and outstanding as of June 30, 2020 |
? |
1 |
|
|
? |
|
||
Additional paid in capital |
? |
3,462,762 |
|
|
80,373 |
|
||
Accumulated deficit |
? |
(888,381 |
) |
|
(447,167 |
) |
||
Accumulated other comprehensive gain (loss) |
? |
6,769 |
|
|
(302 |
) |
||
Total stockholders' equity (deficit) |
? |
2,581,153 |
|
|
(367,096 |
) |
||
Total Liabilities, Redeemable Convertible Preferred Stock and Stockholders' Deficit |
? |
$ |
4,866,967 |
|
|
$ |
1,402,251 |
|
AFFIRM HOLDINGS, INC. |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
||||||||||||||||
(Unaudited) |
||||||||||||||||
(in thousands, except share and per share amounts) |
||||||||||||||||
|
|
Three Months Ended June 30, |
|
Year Ended June 30, |
||||||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Revenue |
? |
? |
? |
? |
|
? |
|
|||||||||
Merchant network revenue |
? |
$ |
88,657 |
|
? |
$ |
85,249 |
|
$ |
379,551 |
|
? |
$ |
256,752 |
|
|
Virtual card network revenue |
? |
19,264 |
|
? |
2,699 |
|
49,851 |
|
? |
19,340 |
|
|||||
Total network revenue |
|
107,921 |
|
|
87,948 |
|
429,402 |
|
|
276,092 |
|
|||||
Interest income |
? |
103,793 |
|
? |
49,117 |
|
326,417 |
|
? |
186,730 |
|
|||||
Gain on sales of loans |
? |
42,582 |
|
? |
11,578 |
|
89,926 |
|
? |
31,907 |
|
|||||
Servicing income |
? |
7,484 |
|
? |
4,689 |
|
24,719 |
|
? |
14,799 |
|
|||||
Total Revenue, net |
? |
$ |
261,780 |
|
|
$ |
153,332 |
|
$ |
870,464 |
|
|
$ |
509,528 |
|
|
Operating Expenses(a) |
? |
? |
? |
? |
|
? |
|
|||||||||
Loss on loan purchase commitment |
? |
$ |
51,010 |
|
? |
$ |
55,311 |
|
$ |
246,700 |
|
? |
$ |
161,452 |
|
|
Provision for credit losses |
? |
25,489 |
|
? |
(32,171 |
) |
65,878 |
|
? |
105,067 |
|
|||||
Funding costs |
? |
15,623 |
|
? |
7,817 |
|
52,700 |
|
? |
32,316 |
|
|||||
Processing and servicing |
? |
21,924 |
|
? |
14,806 |
|
73,767 |
|
? |
49,831 |
|
|||||
Technology and data analytics |
? |
71,233 |
|
? |
31,744 |
|
256,082 |
|
? |
122,378 |
|
|||||
Sales and marketing |
? |
63,544 |
|
? |
5,066 |
|
184,279 |
|
? |
25,044 |
|
|||||
General and administrative |
? |
137,647 |
|
? |
31,439 |
|
370,251 |
|
? |
121,230 |
|
|||||
Total Operating Expenses |
? |
386,470 |
|
|
114,012 |
|
1,249,657 |
|
|
617,318 |
|
|||||
Operating (Loss) Income |
? |
$ |
(124,690 |
) |
|
$ |
39,320 |
|
$ |
(379,193 |
) |
|
$ |
(107,790 |
) |
|
Other income (expense), net |
? |
(5,985 |
) |
? |
(4,413 |
) |
(54,073 |
) |
? |
(4,432 |
) |
|||||
(Loss) Income Before Income Taxes |
? |
$ |
(130,675 |
) |
|
$ |
34,907 |
|
$ |
(433,266 |
) |
|
$ |
(112,222 |
) |
|
Income tax (benefit) expense |
? |
(2,448 |
) |
|
94 |
|
(2,343 |
) |
|
376 |
|
|||||
Net (Loss) Income |
? |
$ |
(128,227 |
) |
|
$ |
34,813 |
|
$ |
(430,923 |
) |
|
$ |
(112,598 |
) |
|
Excess return to preferred stockholders on repurchase |
|
? |
|
|
? |
|
? |
|
|
(13,205 |
) |
|||||
Net (Loss) Income Attributable to Common Stockholders |
|
$ |
(128,227 |
) |
|
$ |
34,813 |
|
$ |
(430,923 |
) |
|
$ |
(125,803 |
) |
|
Other Comprehensive Income (Loss) |
? |
? |
? |
? |
|
? |
|
|||||||||
Foreign currency translation adjustments |
? |
$ |
1,994 |
|
? |
$ |
562 |
|
$ |
7,042 |
|
? |
$ |
(302 |
) |
|
Unrealized gains on investments |
|
29 |
|
|
? |
|
29 |
|
|
? |
|
|||||
Net Other Comprehensive Income (Loss) |
? |
2,023 |
|
? |
562 |
|
7,071 |
|
? |
(302 |
) |
|||||
Comprehensive (Loss) Income |
? |
$ |
(126,204 |
) |
|
$ |
35,375 |
|
$ |
(423,852 |
) |
|
$ |
(112,900 |
) |
|
Per share data: |
? |
? |
? |
? |
? |
? |
? |
|||||||||
Net loss per share attributable to common stockholders for Common stock, Class A common stock and Class B common stock: |
? |
? |
? |
? |
|
|
|
|||||||||
Basic |
? |
$ |
(0.48 |
) |
|
$ |
0.73 |
|
$ |
(2.72 |
) |
|
$ |
(2.63 |
) |
|
Diluted |
? |
$ |
(0.48 |
) |
|
$ |
0.17 |
|
$ |
(2.88 |
) |
|
$ |
(2.63 |
) |
|
Weighted average common shares outstanding |
? |
|
|
|
|
|
|
|||||||||
Basic |
? |
267,282,166 |
|
|
47,552,288 |
|
158,367,923 |
|
|
47,856,720 |
|
|||||
Diluted |
? |
267,282,166 |
|
|
199,238,064 |
|
159,244,611 |
|
|
47,856,720 |
|
(a) Amounts include stock-based compensation as follows: |
||||||||||||||||
|
|
Three Months Ended June 30, |
|
Year Ended June 30, |
||||||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
|
(in thousands) |
||||||||||||||
General and administrative |
? |
$ |
81,771 |
|
|
$ |
2,496 |
|
|
$ |
183,055 |
|
|
$ |
13,682 |
|
Technology and data analytics |
? |
21,922 |
|
|
1,988 |
|
|
83,390 |
|
|
12,285 |
|
||||
Sales and marketing |
|
6,415 |
|
|
868 |
|
|
19,181 |
|
|
4,040 |
|
||||
Processing and servicing |
? |
473 |
|
|
28 |
|
|
2,407 |
|
|
82 |
|
||||
Total stock-based compensation in operating expenses |
? |
$ |
110,581 |
|
|
$ |
5,380 |
|
|
$ |
288,033 |
|
|
$ |
30,089 |
|
AFFIRM HOLDINGS, INC. |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||||||||
(Unaudited) |
||||||||||||||||
(in thousands) |
||||||||||||||||
? |
? |
Three Months Ended June 30, |
|
Year Ended June 30, |
||||||||||||
? |
? |
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Cash Flows from Operating Activities |
? |
|
|
|
|
|
||||||||||
Net (Loss) Income |
? |
$ |
(128,227 |
) |
$ |
34,813 |
|
$ |
(430,923 |
) |
|
$ |
(112,598 |
) |
||
Adjustments to reconcile net (loss) income to net cash used in operating activities: |
? |
|
|
|
|
|
||||||||||
Provision for credit losses |
? |
25,489 |
|
(32,171 |
) |
65,878 |
|
|
105,067 |
|
||||||
Amortization of premiums and discounts on loans, net |
? |
(29,666 |
) |
(6,937 |
) |
(90,371 |
) |
|
(27,605 |
) |
||||||
Gain on sales of loans |
? |
(42,582 |
) |
(11,578 |
) |
(89,926 |
) |
|
(31,907 |
) |
||||||
Changes in fair value of assets and liabilities |
|
6,345 |
|
3,553 |
|
51,655 |
|
|
2,847 |
|
||||||
Amortization of commercial agreement assets |
? |
19,006 |
|
? |
|
69,103 |
|
|
? |
|
||||||
Amortization of debt issuance costs |
? |
2,741 |
|
652 |
|
6,416 |
|
|
2,313 |
|
||||||
Stock-based compensation |
? |
110,581 |
|
5,036 |
|
288,033 |
|
|
29,625 |
|
||||||
Depreciation and amortization |
? |
7,887 |
|
2,023 |
|
19,979 |
|
|
9,444 |
|
||||||
Impairment of right of use assets |
|
403 |
|
? |
|
11,544 |
|
|
? |
|
||||||
Purchases of loans held for sale |
? |
(1,000,062 |
) |
(465,533 |
) |
(2,640,734 |
) |
|
(2,101,483 |
) |
||||||
Proceeds from the sale of loans held for sale |
? |
995,281 |
|
446,171 |
|
2,594,835 |
|
|
2,021,938 |
|
||||||
Other |
|
(1,893 |
) |
661 |
|
5,129 |
|
|
81 |
|
||||||
Change in operating assets and liabilities: |
? |
|
|
|
|
|
||||||||||
Accounts receivable, net |
? |
(16,473 |
) |
(15,036 |
) |
(22,934 |
) |
? |
(19,049 |
) |
||||||
Other assets |
? |
(22,004 |
) |
(4,539 |
) |
(209,139 |
) |
? |
19,936 |
|
||||||
Accrued interest payable |
? |
(1,140 |
) |
(365 |
) |
1,395 |
|
? |
428 |
|
||||||
Accounts payable |
? |
28,159 |
|
5,950 |
|
32,223 |
|
? |
7,514 |
|
||||||
Accrued expenses and other liabilities |
? |
16,923 |
|
6,814 |
|
119,625 |
|
? |
13,868 |
|
||||||
Payable to third-party loan owners |
? |
13,556 |
|
2,039 |
|
25,082 |
|
? |
8,279 |
|
||||||
Net Cash Used in Operating Activities |
? |
(15,676 |
) |
(28,447 |
) |
(193,130 |
) |
|
(71,302 |
) |
||||||
Cash Flows from Investing Activities |
? |
|
|
? |
? |
|
||||||||||
Purchases and originations of loans held for investment |
|
(1,583,418 |
) |
(797,034 |
) |
(5,897,252 |
) |
|
(2,830,320 |
) |
||||||
Proceeds from the sale of loans held for investment |
? |
475,816 |
|
91,730 |
|
824,011 |
|
? |
303,433 |
|
||||||
Principal repayments and other loan servicing activity |
? |
1,322,267 |
|
686,946 |
|
4,324,618 |
|
? |
2,294,833 |
|
||||||
Acquisition, net of cash and restricted cash acquired |
|
(117,657 |
) |
? |
|
(222,433 |
) |
|
? |
|
||||||
Additions to property, equipment and software |
? |
(7,838 |
) |
(2,315 |
) |
(20,252 |
) |
? |
(21,019 |
) |
||||||
Other investing cash inflows |
|
1,116 |
|
? |
|
1,453 |
|
|
? |
|
||||||
Other investing cash outflows |
|
(10,178 |
) |
? |
|
(32,178 |
) |
|
? |
|
||||||
Net Cash Provided by (Used in) Investing Activities |
? |
80,108 |
|
(20,673 |
) |
(1,022,033 |
) |
|
(253,073 |
) |
||||||
Cash Flows from Financing Activities |
? |
|
|
? |
? |
|
||||||||||
Proceeds from funding debt |
? |
645,988 |
|
604,058 |
|
2,942,254 |
|
? |
2,132,805 |
|
||||||
Payment of debt issuance costs |
? |
(1,233 |
) |
(6,304 |
) |
(12,499 |
) |
? |
(7,687 |
) |
||||||
Principal repayments of funding debt |
? |
(727,043 |
) |
(552,995 |
) |
(3,165,103 |
) |
? |
(1,882,155 |
) |
||||||
Proceeds from issuance of notes and residual trust certificates by securitization trusts |
? |
(350 |
) |
? |
|
1,395,879 |
|
? |
? |
|
||||||
Principal repayments of notes issued by securitization trusts |
? |
(65,865 |
) |
? |
|
(210,368 |
) |
? |
? |
|
||||||
Proceeds from issuance of convertible debt, net |
|
? |
|
75,000 |
|
? |
|
|
75,000 |
|
||||||
Proceeds from issuance of redeemable convertible preferred stock, net |
? |
? |
|
? |
|
434,542 |
|
? |
15,481 |
|
||||||
Repurchases and conversion of redeemable convertible preferred stock |
|
? |
|
? |
|
(13 |
) |
|
(22,591 |
) |
||||||
Proceeds from initial public offering, net |
? |
(125 |
) |
? |
|
1,305,176 |
|
|
? |
|
||||||
Proceeds from exercise of common stock options and warrants |
? |
3,227 |
|
958 |
|
47,042 |
|
? |
2,733 |
|
||||||
Repurchases of common stock |
|
(14 |
) |
? |
|
(800 |
) |
? |
(18,854 |
) |
||||||
Payments of tax withholding for stock-based compensation |
? |
(30,714 |
) |
? |
|
(158,280 |
) |
|
? |
|
||||||
Net Cash Provided by (Used in) Financing Activities |
|
(176,129 |
) |
120,717 |
|
2,577,830 |
|
|
294,732 |
|
||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(2,673 |
) |
? |
|
1,837 |
|
|
? |
|
||||||
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash |
? |
(114,370 |
) |
71,597 |
|
1,364,504 |
|
? |
(29,643 |
) |
||||||
Cash and cash equivalents and restricted cash, beginning of period |
? |
1,807,002 |
|
256,531 |
|
328,128 |
|
? |
357,771 |
|
||||||
Cash and Cash Equivalents and Restricted Cash, end of period |
? |
$ |
1,692,632 |
|
$ |
328,128 |
|
$ |
1,692,632 |
|
|
$ |
328,128 |
|
AFFIRM HOLDINGS, INC. |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS, CONT. |
||||||||||||||||
(Unaudited) |
||||||||||||||||
(in thousands) |
||||||||||||||||
|
|
Three Months Ended June 30, |
|
Year Ended June 30, |
||||||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Supplemental Disclosures of Cash Flow Information |
? |
|
|
|
|
? |
? |
? |
||||||||
Cash payments for interest |
? |
$ |
13,115 |
|
|
$ |
6,013 |
|
|
$ |
41,690 |
|
|
$ |
28,085 |
|
Cash paid for income taxes |
|
138 |
|
|
? |
|
|
219 |
|
|
? |
|
||||
Cash paid for operating leases |
|
3,489 |
|
|
? |
|
|
13,215 |
|
|
? |
|
||||
Supplemental Disclosures of Non-Cash Investing and Financing Activities |
? |
|
|
|
|
|
|
|
||||||||
Stock-based compensation included in capitalized internal-use software |
? |
$ |
4,530 |
|
|
$ |
572 |
|
|
$ |
13,999 |
|
|
$ |
2,921 |
|
Additions to property and equipment included in accrued expenses |
? |
6 |
|
|
27 |
|
|
6 |
|
|
27 |
|
||||
Issuance of warrants in exchange for commercial agreement |
? |
? |
|
|
? |
|
|
270,579 |
|
|
? |
|
||||
Acquisition of commercial agreement assets |
|
? |
|
|
? |
|
|
25,900 |
|
|
? |
|
||||
Conversion of redeemable convertible preferred stock |
|
? |
|
|
? |
|
|
1,327,271 |
|
|
? |
|
||||
Conversion of convertible debt |
? |
? |
|
|
? |
|
|
88,559 |
|
|
? |
|
||||
Issuance of common stock in connection with acquisition |
|
214,475 |
|
|
? |
|
|
331,498 |
|
|
? |
|
||||
Right of use assets obtained in exchange for operating lease liabilities |
|
? |
|
|
? |
|
|
78,421 |
|
|
? |
|
Reconciliation of Non-GAAP Financial Measures
The following tables present a reconciliation of transaction costs, revenue less transaction costs, adjusted operating income (loss), adjusted operating margin, and equity capital required to their most directly comparable financial measures prepared in accordance with GAAP for each of the periods indicated.
|
Three Months Ended June 30, |
|
Year Ended June 30, |
|||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|||||||||
|
(in thousands, except percent data) (unaudited) |
|||||||||||||||
Operating Expenses |
|
|
|
|
||||||||||||
Loss on loan purchase commitment |
$ |
51,010 |
|
$ |
55,311 |
|
$ |
246,700 |
|
$ |
161,452 |
|
||||
Provision for credit losses |
25,489 |
|
(32,171 |
) |
65,878 |
|
105,067 |
|
||||||||
Funding costs |
15,623 |
|
7,817 |
|
52,700 |
|
32,316 |
|
||||||||
Processing and servicing |
21,924 |
|
14,806 |
|
73,767 |
|
49,831 |
|
||||||||
Transaction Costs (Non-GAAP) |
$ |
114,046 |
|
$ |
45,763 |
|
$ |
439,045 |
|
$ |
348,666 |
|
||||
Technology and data analytics |
71,233 |
|
31,744 |
|
256,082 |
|
122,378 |
|
||||||||
Sales and marketing |
63,544 |
|
5,066 |
|
184,279 |
|
25,044 |
|
||||||||
General and administrative |
137,647 |
|
31,439 |
|
370,251 |
|
121,230 |
|
||||||||
Total Operating Expenses |
$ |
386,470 |
|
$ |
114,012 |
|
$ |
1,249,657 |
|
$ |
617,318 |
|
||||
|
|
|
|
|
||||||||||||
Total Revenue, net |
$ |
261,780 |
|
$ |
153,332 |
|
$ |
870,464 |
|
$ |
509,528 |
|
||||
Less: Transaction Costs (Non-GAAP) |
(114,046 |
) |
(45,763 |
) |
(439,045 |
) |
(348,666 |
) |
||||||||
Revenue Less Transaction Costs (Non-GAAP) |
$ |
147,734 |
|
$ |
107,569 |
|
$ |
431,419 |
|
$ |
160,862 |
|
||||
|
|
|
|
|
||||||||||||
Operating (Loss) Income |
$ |
(124,690 |
) |
$ |
39,320 |
|
$ |
(379,193 |
) |
$ |
(107,790 |
) |
||||
Add: Depreciation and amortization |
7,887 |
|
2,023 |
|
19,979 |
|
9,444 |
|
||||||||
Add: Stock-based compensation included in operating expenses |
110,581 |
|
5,380 |
|
288,033 |
|
30,089 |
|
||||||||
Add: Amortization of Shopify Inc. commercial agreement asset |
16,853 |
|
? |
|
64,820 |
|
? |
|
||||||||
Add: Other costs3 |
3,582 |
|
? |
|
20,697 |
|
? |
|
||||||||
Adjusted Operating Income (Loss) (Non-GAAP) |
$ |
14,213 |
|
$ |
46,723 |
|
$ |
14,336 |
|
$ |
(68,257 |
) |
||||
Divided by: Total Revenue, net |
$ |
261,780 |
|
$ |
153,332 |
|
$ |
870,464 |
|
$ |
509,528 |
|
||||
Adjusted Operating Margin (Non-GAAP) |
5.4 |
% |
30.5 |
% |
1.6 |
% |
(13.4 |
)% |
|
June 30, 2021 |
June 30, 2020 |
June 30, 2019 |
|||||||||
|
(in thousands) (unaudited) |
|||||||||||
Loans held for investment |
$ |
2,022,320 |
|
$ |
1,034,312 |
|
$ |
735,414 |
|
|||
Add: Loans held for sale |
13,030 |
|
4,459 |
|
3,420 |
|
||||||
Less: Funding debt |
(680,602 |
) |
(817,926 |
) |
(569,234 |
) |
||||||
Less: Notes issued by securitization trusts |
(1,176,673 |
) |
? |
|
? |
|
||||||
Equity Capital Required (Non-GAAP) |
$ |
178,075 |
|
$ |
220,845 |
|
$ |
169,600 |
|
_______________
1 Information about Affirm's use of non-GAAP financial measures is provided under "Key Operating Metrics, Non-GAAP Financial Measures and Supplemental Performance Indicators" and "Use of Non-GAAP Financial Measures" below, and reconciliation of GAAP results to non-GAAP results are provided in the tables at the end of this press release.
2 A reconciliation of adjusted operating loss to the comparable GAAP measure is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future.
3 Other costs consists of one-time expenses incurred in the period associated with the Company's initial public offering, its strategic acquisitions, and impairment of right of use assets.
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