Affirm Holdings shares closed the most recent session down 3.92%, underperforming the S&P 500’s 1.4% decline on the same day. The pullback follows three consecutive days of selling pressure and represents the largest one-day percentage drop for the stock since mid-December.

In ResearchAndMarkets’ Q1 2026 BNPL report, the global market is projected to expand from $509.2 billion in 2026 to approximately $1 trillion by 2031 at a compound annual growth rate of 14.7%. Within this landscape, Affirm remains one of the top two pure-play fintechs globally, offering point-of-sale loans and both virtual and physical cards. The company has integrated with more than 15,000 merchants and recently added partnerships with three regional banks to embed its financing solutions into banking apps.

Affirm achieved GAAP profitability in fiscal year 2025, reporting a net income of $68 million versus a net loss of $112 million in the prior year. Revenue for the full year climbed 35% year-over-year to $4.5 billion, driven by a 42% increase in transaction volume to $23 billion. Management highlighted that higher take-rates on merchant fees and lower credit losses contributed materially to the margin expansion.

Investors are watching two key potential catalysts: first, the company’s application to charter an industrial loan company bank, which could lower funding costs by 50 basis points if approved by mid-2026; second, the prospect of a nationwide cap on credit card interest rates, which could drive incremental loan originations through Affirm’s fixed-rate installment products. Both developments could improve cost of capital and boost volume growth.