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Affirm soars after earnings beat

Buy now, pay later service Affirm soars following its recent earnings release.

Video Transcript

- And we want to get over to Jared Blikre because a firm is out with its earnings results. Jared, what do you have?

JARED BILKRE: That's right. And the stock is soaring. Right now, for the fourth quarter of results, revenue came in-- a nice beat here-- at $261.8 million. The estimate was for a much lower at 226.7 million.

Now, on the earnings, where it's actually a loss, that was wider than expected. So their net loss for the fourth quarter 128.2 million, which equates to a loss per share of $0.48. Again, worse than the Street expected.

Gross merchandise volume, key metric there, 2 and 1/2 billion. That is up sequentially 8.7% from the prior quarter. And then their outlook for the fiscal year 2022 they're looking for gross merchandise volume growth of at least 50%, or if you exclude Peloton, 70%.

And also, this doesn't include any benefit from the Amazon partnership that was announced last month that sent the stock surging something like 60, 70%.

And just a few details to recap that deal from the report. In August 20, 2001, the company announced a non-exclusive partnership with Amazon to offer flexible payment solutions to consumers who shop at Amazon.com in the US. This allows them to split the total cost of purchases of $50 or more into simple monthly payments without late or hidden fees.

They're currently testing this with select customers now. In the coming months, the company says, Amazon plans to make a firm more broadly available to its customers. I should note, the stock up something like 25%, if you include the gains that they had as of the close, which was 10% or 11%. So the investors are really banking on this Amazon partnership-- really juicing their numbers.

That production of at least 50% GMV growth-- pretty stunning in and of itself. When you add an Amazon you can only imagine what that would be. So the stock up about 25% on the day. And a beat on the topline, but a miss on the bottom line.