PayPal Holdings Inc (NASDAQ:PYPL) co-founder Max Levchin-backed fintech company Affirm Holdings, Inc filed a preliminary prospectus for an initial public offering with the U.S. Securities and Exchange Commission on Wednesday
Affirm’s IPO: The company intends to list its common stock on the Nasdaq Stock Market with the ticker "AFRM," although it didn't provide further details on the offering, including the pricing or the number of shares it planned to sell.
Affirm registered two classes of common stocks. Class A shareholders are entitled to one vote per share and Class B common stockholders get 15 votes for each share held.
The offering will be underwritten by a consortium led by Morgan Stanley & Co LLC (NYSE:MS), Goldman Sachs & Co LLC (NYSE:GS), and boutique investment bank Allen & Company. Underwriters will be entitled to a greenshoe option.
Key Financials Metrics: In the SEC filing, Affirm disclosed that it caters to over 6,500 merchants and more than 6.2 million customers at a 64% retention rate. Recorded Gross Merchandise Volumes net of refunds for FY 2020 was $4.6 billion, a 77% growth compared to the previous year. The multiple for transactions per active customer grew to 2.2 in the September-ended quarter, from 2.1 in the quarter ended in June.
A significant portion of Affirm’s revenues is generated from Merchant Network Revenues and Interest Income. Other revenue segments include revenues from Virtual Card Networks, Gains/Loss from loan sales, and Servicing income.
In the quarter ended September 30, Affirm booked close to $174 million of which Merchant network and Interest Income contributed 53.6% and 31.17% respectively.
Compared to the September 2019 quarter, growth in revenues was close to 98%.
Net loss for the recent quarter was $15.27 million, vis-à-vis a loss of $30.79 million for the same period one year ago.
Affirm’s asset base consisted of cash and cash equivalents balance of $684.4 million and $1,414.1 million as Loans for investment.