Affirm could see GAAP profitability by Q4 of 2025, says Mizuho

Mizuho analyst Dan Dolev says Affirm is set to provide fiscal 2025 guidance on Wednesday with consensus pointing to a GAAP loss for the year. However, the firm believes Affirm has a potential to reach GAAP operating income profitability by Q4 of 2025, helped by a “dramatically lower warrant expense burden” in the second half of the year, lower interest rates, and improving scale even before any incremental benefit from Apple Pay buy now pay later volumes. The prospect of seeing potential GAAP profitability by Q4 of 2025 “could result in a step-function in the attractiveness of the AFRM stock,” the analyst tells investors in a research note. Mizuho keeps an Outperform rating on the shares with a $65 price target.