Affirm (NASDAQ:AFRM) President Libor Michalek addressed investor questions at the Morgan Stanley TMT Conference 2026, discussing recent results, how the company thinks about promotional activity, and what he characterized as a stable consumer and funding backdrop. The conversation also covered longer-term drivers of buy now, pay later (BNPL) adoption, product expansion into new categories, and how emerging “agentic commerce” could influence payments and financing choices.
Outlook and growth comparisons
Michalek said investor focus on a potential second-half deceleration in gross merchandise volume (GMV) growth should be viewed in the context of year-over-year comparisons. He noted that the prior-year quarter had roughly 40% to 45% year-over-year growth and included “quite a bit of Walmart volume,” which he said rolled off after the companies parted ways. As Affirm laps that period, he said the company expects a “reversion to the mean” in growth.
0% promotions and “Zero Percent Days”
A recurring theme was how Affirm uses merchant-funded 0% offers and what that means for profitability and modeling. Michalek said 0% promotions are “ultimately dollar accretive,” despite being lower margin on the individual transaction, because they drive engagement and help merchants manage their own promotional strategies.
He described 0% offers as a lever merchants can use to improve conversion or clear inventory, and said Affirm views them as a cost-effective way for merchants to deliver value to consumers. He also agreed that these promotions can attract higher-quality consumers, and emphasized the company targets such offers where they have the most impact and remain positive on unit economics.
To illustrate longer-term engagement, Michalek said Affirm has about 25 million annual active users, and that across a four-year horizon, the user count is “like 40 million.” He said the probability of a user using the product again “approaches 80%,” which Affirm aims to foster with targeted promotional activity.
On the company’s “Zero Percent Days” promotion, he said the key learning from a recent test was that it was net accretive and did not simply pull demand forward within the quarter. Instead, he said the promotion appeared to influence a “buy or don’t buy” decision for certain consumers. He said Affirm is still testing the “right cadence” for such events and is focused on scaling them to a wider range of merchants and promotions.
Consumer health and credit performance
Asked about consumer spending and repayment trends, Michalek described conditions as “surprisingly and positively boring.” He said Affirm is seeing healthy demand across merchants and services, with repayment performance in line with expectations. He also pointed to the short weighted average life of Affirm’s products as enabling the company to react quickly if needed, adding that Affirm is not changing its credit box or origination approach at present.
BNPL tailwinds, TAM, and category expansion
Michalek argued BNPL penetration can continue to rise, citing higher adoption in international markets where BNPL has been established longer. He said BNPL penetration in U.S. e-commerce is currently around 8% to 9%, while other markets are “north of 20%.”
He framed Affirm’s longer-term addressable market as broader consumer credit, positioning closed-end installment financing as a preferable alternative to revolving credit. He said consumers benefit from transparent, upfront terms—“no late fees, no revolving, no deferred interest”—and described the U.S. revolving debt market as roughly $1.1 trillion to $1.2 trillion that “shouldn’t be revolving” but instead financed through fixed purchase financing.
As Affirm expands into both lower-dollar and higher-ticket categories, Michalek said the company underwrites each transaction in the context of the consumer’s overall debt obligations and monthly outlay. He discussed how the company evaluates whether a use case represents a manageable “time shift” in payments versus an “unsustainable path” of recurring debt. As an example, he said financing an annual HOA payment over 12 months can make sense, while spreading it over 36 months could create issues if the expense recurs yearly.
Distribution, product roadmap, agentic commerce, and funding
On growth catalysts, Michalek said expansion is driven by multiple reinforcing efforts—merchant distribution, greater consumer “surface area,” product evolution, and partnerships. He said Affirm continues to invest in the Affirm Card and is working toward more differentiated experiences for different consumer segments, rather than a single uniform product. He also pointed to expansion into services, mentioning that Affirm was rolling out with Intuit “as of today,” and referenced partnerships including ServiceTitan and Lowe’s.
He also highlighted partnerships with FIS and Fiserv aimed at bringing Affirm functionality to debit issuer products, enabling issuers to offer installment financing through the debit cards consumers already have.
Discussing wallet integrations, he said Apple Pay and Google Pay reinforce card adoption, and that offline usage is growing faster than e-commerce. He characterized offline BNPL penetration as “sub 1%,” compared with 8% to 9% online, and said he sees no reason the two cannot normalize over time.
On “agentic commerce,” Michalek argued that Affirm’s transparent credit terms could become easier to communicate when AI agents are involved in shopping and checkout. He said agents will still act on consumer intent—seeking the best deal and fairest financing—and positioned Affirm as an “optimal way” to pay over time. He also compared potential AI transaction fees to existing affiliate and marketing economics, saying what some AI labs charge is “quite modest” relative to what merchants may pay on an affiliate basis.
Finally, on funding and capital markets, Michalek said Affirm’s funding environment remains strong. He noted the company completed an ABS deal in January that he described as its tightest spread to date, with spreads “under 100 basis points,” and said it was “well oversubscribed.” He said Affirm uses ABS issuance to broaden relationships with potential capital partners, including names such as CPPIB and Prudential, and added that the company is seeing “a flight to quality” rather than skittishness among partners.
About Affirm (NASDAQ:AFRM)
Affirm Holdings, Inc is a financial technology company that provides point-of-sale consumer lending and payments solutions for online and in-store purchases. Its core product is a buy-now-pay-later (BNPL) platform that enables consumers to split purchases into fixed, transparent installment loans with no hidden fees. Affirm offers a range of financing options through merchant integrations, a consumer-facing mobile app and virtual card capabilities, and tools for merchants to offer alternative payment methods at checkout.
