Affirm Holdings Inc To Host CFO fireside chat Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : <_ALACRA_META_ABSTRACT>Awesome. So just in terms of format, a firm like some of the other fintechs, they like to loop in the retail questions here, which I think is great. I have several questions prepared, and I'll loop in the retail questions. And with that, let's get into it. So topic [is your] Rob, like everybody wants to talk about Boeing and growth, right? So that's going to be our first topic here. And I'd like to start with a topic like this from a 1,000-foot view, right? So my first question is that there are a ton of different payment methods available to consumers here in the US. Why do you believe BNPL has had so much success so far? And then specific to a firm of retail investor and manual OS with plenty of BNPL players in the market now? What is the firm's mode?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Rob, I think that was a great summary. And kind of like turning to the volume growth discussion for kind of quarter-to-date because it's a big topic for investors. We're trying to wrap our heads around how the calendar year 4Q, big quarter for you guys are shaping up on the positive side of things, right? You continue to take meaningful share. But against that, the industry at large is facing a tougher comp for e-commerce spend this quarter. So with that in mind, I was just hoping you could opine a little bit on near-term trends and what's going on there?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : That's super helpful, Rob. And we always have to try, right? Like I know that you don't give a quarter-to-date number, but we'll always ask.

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Sure. And then one from Christy. She asked, what are the trends you are seeing with consumers? Are you seeing any increase in credit default by your customers?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : That's really helpful, Rob. And we'll dig into credit a little bit more later in the conversation here. Next one on volume growth. So like you've mentioned, it's been really strong for a friend, right? So year-over-year GMV growth last quarter was 42%. And one of the big drivers is the success of the firm card. What we thought was pretty interesting is if you look at the

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Yes, Rob, that's super helpful. I think one important thing that you mentioned there was educating about the client, right? So from the outside looking in, it seems like you guys have kind of like prudently tried to grow this business, and you haven't like aggressively marketed the card yet. But you kind of -- like how I starting to think about it is like the more data that you get, the better your feel about this underwriting may yield market a little bit more aggressively moving forward. So could you talk about that push and pull right? Like when do you think you'll reach the breaking point where you have the data where you just like, okay, we can meaningfully increase the attach rate now?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Got it, Rob. That's really helpful. So next one is kind of a two part, like first from the retail investor and then one similar question for me. So (inaudible) how competitive is a firm compared to banks. And related to that, a partnership that we found really interesting is your new partnership with FIS, right, where you'll enable third bank partners to offer a firm to consumers through their existing debit carats. So my second follow-on question to that is, do you view banks more as competitors compared to partners? And how significant could this partnership be with that finance?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Super helpful, Rob. And then next one I wanted to ask about, speaking of when -- when you kind of sold the words right out of my mouth there. I look at the 0% APY monthly installment loan product is kind of like a win-win-win for merchants, consumers and firm. And you guys are kind of like leaning into this product, right? You had the 0% days recently that I thought I think Max interestingly called it the big nothing days on your earnings call there. I was just hoping you could provide a little bit more color on the growth here and maybe how a firm is becoming more of a marketing tool for merchants? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 16, 2025 / 5:00PM, AFRM.OQ - Affirm Holdings Inc To Host CFO fireside chat

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : No, I hope so too, Rob. If you look at -- I was one of the consumers that participated in the (inaudible) a ton of good deals there, and she loves that brand. So -- so yes, you definitely made my Christmas shopping potentially a little bit better with -- so thank you for that. So I want to move on to the second part of our conversation. So we just talked about volume growth Second part of the conversation, I'd like to talk about your partnerships, right? And I think these are critically important for a firm as you look to essentially put a firm in front of as many consumers as possible as a payment option. So arguably your most important partnership, you just renewed with Amazon, right? I was hoping that you could touch on that a bit, including some detail and how you continue to deepen our integration with Amazon and improve the consumer experience there.

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Really detailed answer. Next one, and this is a retail question, I think it fits into the partnership angle a manual OS quote, how does a firm plan on establishing a footing in Agenetic shopping with big name players starting to get involved there?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Rob, did I lose you? So I lose you during that answer. I'm not sure if the clients did as well, if you don't mind repeating it. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 16, 2025 / 5:00PM, AFRM.OQ - Affirm Holdings Inc To Host CFO fireside chat

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : That's helpful, Rob. And you're a pro here. I feel like you just led me into my next question. So you've probably done this one (inaudible). But next one I wanted to ask about Shopify right? So great long-term partner with you guys. You guys are now in GA with Shopify in the UK. And the question I wanted to ask you on this topic is just compared to when you went live with Shopify in the US, how might your go-to-market efforts here be a little bit different now that you're going live in the UK? Just because BNPL is already a pretty prominent payment method over there?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Thanks for helpful, Rob. And you kind of touched on this in a couple of your previous answers on Amazon and Agentic Commerce. But one other partnership that I think is interesting is with Google, right, and not on the AI side of things, but just with Chrome Autofill right? So I believe it was a couple of months ago that a firm became a payment method that was included in Chrome Autofill. Could you talk about the opportunity there for you guys and then your ongoing partnership with Google?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Really helpful, Rob. So turn in from partnerships to credit, which being the CFO, I'm sure you're asked about credit all the time. When I talk to investors about a firm sometimes investors make it a little bit spooked right when they see that 40% of your receivables come from nonprime consumers. But despite that -- and that's a little bit higher than most of the credit card issuers out there. But despite that, historically, your DQ rates are well below peers, right? So could you talk about your underwriting process and what differentiates a firm's offering compared to peers on credit?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : That's super helpful, Rob. And moving on to our next section that kind of it's just like looping in all the financial questions here. So we're going to start with one from retail. So [Rowan] asked are there still meaningful opportunities to reduce transaction expenses as a percentage of GMV? Are you approaching a structural floor here?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Rob, that was super helpful, and we'll touch on this in a couple of questions, but your overall incremental margins kind of prove that your business model and the network business model is a really good one. So you may be seeing this economies of scale in certain parts of the business from the lower AOV. But overall, the margin profile of the business is really good and improving. We actually have a retail question that loops into what you were talking about with the processing and servicing line. So Christy [SS], what ways are you innovating regarding your customer service? And can AI play a role in improving that offering for you guys?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : No, that's really helpful, Rob. And pretty rare, I would say, in the industry if you dealt with any banking apps and some of the bots that you have to deal with there. So that's pretty interesting that you're seeing the better NPS score when somebody uses the bot. So next one, kind of on financials here, and it's probably your favorite topic, and I'm shocked that we haven't talked about it yet, but it's the LTC take rate, right? So you guys have been pretty clear right with the 2026 guide, you're guiding to 4% guidance for the first half of the year is a little bit above that guidance for the back half of the year is a little bit below that. There's some seasonality there. I was hoping you could talk through the movement pieces right investors. I think maybe overly focused on a mix shift to the 0% APY loans. But I think there are a number of offsets for that adverse mix shift that's going on in the business for this KPI for you guys. So could you talk through all the moving pieces?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Rob, it's super helpful. I hate to bring it back to my own example, but right, I was Christmas shopping on Amazon last night. There was a good 0% offering there. You're buying these high AOV products? And if it wasn't for the 0%, right, like you probably wouldn't have gotten that incremental volume from me, I would have just use my credit card, right? So like new customer, good offering there, getting the incremental volume, I think it makes sense.

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : No, it makes total sense. And then just on this metric, I just had an e-mail come in, there's some seasonality, right, in the metric to be aware of. So is there really nothing to see there in terms of the first half versus second half guide? Is that just kind of like typical seasonality? Or is that mix shift? Or is that conservatism? Like how should we read into that guidance?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : No, it's really helpful, Rob. And I think it's reflecting. I think it makes sense to guide that way. Like you're giving us the floor right and then we can go from there. So no, I appreciate how you guys provide guidance. Moving to closer to the bottom line, right? So thinking about the EBIT and your incremental margins there. You guys -- your team recently mentioned that you owe us a new margin target, right? You blew passed your 2023 Investor Day targets. I don't expect a new target here. But I mentioned this in a new -- and I referred to it in a previous question, right? Like if I use RLTC as your denominator in my incremental margin targets, our calculations, your incremental margin has been running north of 75% over the past couple of years, and that's best-in-class in the space. So can you just kind of like talk about the business model. And what drives those really high margins for you guys?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : So that makes a ton of sense. Naturally, when we talk about great margins and free cash flow generation, people want to know about capital return. Right? So we have a couple of retail questions. And the one reads, as a firm becomes sustainably profitable, how do you think about prioritizing the use of those profits between reinvesting for growth, strengthening the balance sheet, and eventually returning capital to shareholders.

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : No, Rob, it super helpful. And I just have one last one here before we call it a day. So you kind of touched on it in the margin question, right, like certain long-term investments that you could make -- and I know on last quarter's earnings call, one of my peers tried to get Max to maybe talk about earned wage access or something like that, and he doesn't want to talk about any product launches before they launch. Totally makes sense. But if you think about kind of like the firm's mission statement, so it's to deliver on its financial products that improve lives, you're doing a ton of that today, but I bet you think you can do a lot more. Is there anything that you could give us in terms of current seed investments that you may be making in the business to kind of like fulfill that mission statement as we think three, five years out?

Question: Matthew Coad - Suntrust Robinson Humphrey Capital Markets - Analyst : Got it. Noted Rob, that was great. Thanks for taking the time today. Before we call it today, any kind of final remarks that you want to leave people with you?