Affirm Holdings Inc said on Wednesday it had expanded its partnership with Amazon and reported quarterly revenue above Wall Street estimates, boosted by growth in active consumers and merchants on its buy now, pay later (BNPL) platform.
Shares in Affirm, which had been falling for the past four sessions and were on course for their worst day since the company went public in January, jumped more than 24% in extended trading.
Affirm’s expanded partnership will allow all eligible U.S. purchases of $50 and more on Amazon to be split into simple monthly payments, which was earlier available to only select customers.
Amazon will also receive multiple tranches of warrants to purchase shares of Affirm’s Class A common stock, the company said, adding that it would also be the e-commerce giant’s only BNPL service provider in the United States as part of the amended agreement.
The company will now serve as Amazon’s only credit card alternative in the buy now, pay later space through the next two holiday seasons in the United States.
The BNPL industry took off last year, as homebound consumers opted for online shopping and used pay later options to make purchases easier on their wallets.
BNPL firms charge merchants a fee for offering their customers small, point-of-sale loans which are paid back in interest-free installments, bypassing credit checks in the process.
The company now expects current-quarter revenue in the range of $320 million to $330 million, above estimates of $296.09 million.
Total revenue rose to $269.4 million in the first quarter from $173.9 million a year earlier. Analysts on average were expecting revenue of $248.23 million, according to IBES data from Refinitiv.
Affirm’s active consumers more than doubled in the past quarter to 8.7 million, while merchants on its platform rose to 102,000 from just 6,500 a year earlier.
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