Levchin: Affirm (AFRM) Sees Resilient US Consumers Despite Macroeconomic Headwinds

Affirm (AFRM) CEO Max Levchin said the narrative of a “demise” of the American consumer is “greatly exaggerated,” citing strong repayment curves and a 36% YoY rise in gross merchandise volume (GMV) in Q2. He attributed the resilience to proprietary AI underwriting and a 96% repeat transaction rate, with 96% of transactions coming from existing users. However, broader sentiment indicators like the University of Michigan Index of Consumer Sentiment rose to 57.3 in February but remain 20% below peaks, signaling inflationary and labor concerns. Following the report, AFRM shares fell nearly 7% on Friday. Guidance for Q3 and Q4 GMV growth of 30% and 25%, respectively, tempered upbeat expectations, with Citi analyst Bryan Keane maintaining a Buy rating at $100, citing strong active merchant growth of 42% YoY and ongoing private credit market strength.