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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| | | | | |
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2022
OR
| | | | | |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from __________ to __________
Commission file number 001-39888
Affirm Holdings, Inc.
(Exact name of registrant as specified in its charter)
| | | | | | | | | | | |
Delaware | | 84-2224323 |
(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
| |
650 California Street | | | |
San Francisco, California | | | 94108 |
(Address of principal executive offices) | | (Zip Code) |
(415) 984-0490
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | | | | | | | |
Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
Class A common stock, par value $0.00001 per share | | AFRM | | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| | | | | | | | | | | |
Large accelerated filer | ☐ | Accelerated filer | ☐ |
Non-accelerated filer | ☒ | Smaller reporting company | ☐ |
| | Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of May 10, 2022, the number of shares of the registrant’s Class A common stock outstanding was 226,270,872 and the number of shares of the registrant's Class B common stock outstanding was 60,159,497.
TABLE OF CONTENTS
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (“Form 10-Q”), as well as information included in oral statements or other written statements made or to be made by us, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) , and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve substantial risks and uncertainties. All statements other than statements of historical fact contained in this report, including statements regarding our future results of operations and financial condition, business strategy, and plans and objectives of management for future operations, are forward-looking statements. In some cases, forward-looking statements may be identified by words such as “anticipate,” “believe,” “continue,” “could,” “design,” “estimate,” “expect,” “intend,” “may,” “plan,” “potentially,” “predict,” “project,” “should,” “will,” “would,” or the negative of these terms or other similar expressions. These forward-looking statements include, but are not limited to, statements concerning the following:
•our expectations regarding our future revenue, expenses, and other operating results and key operating metrics;
•our ability to attract additional merchants and retain and grow our relationships with our existing merchant and commerce partners;
•our ability to compete successfully in a highly competitive industry;
•our ability to attract new consumers and retain and grow our relationships with our existing consumers;
•our expectations regarding the development, innovation, introduction of, and demand for, our products;;
•our ability to successfully engage new originating bank partners;
•the availability of funding sources to support our business model;
•our ability to effectively price and score credit risk using our proprietary risk model;
•the performance of loans facilitated and originated through our platform;
•the future growth rate of our revenue and related key operating metrics;
•our ability to achieve or sustain profitability in the future;
•our ability to remain in compliance with laws and regulations that currently apply or become applicable to our business;
•our ability to protect our confidential, proprietary, or sensitive information;
•past and future acquisitions, investments, and other strategic investments;
•our ability to maintain, protect, and enhance our brand and intellectual property;
•litigation, investigations, regulatory inquiries, and proceedings;
•the impact of macroeconomic conditions on our business, including the impact of the COVID-19 pandemic; and
•the size and growth rates of the markets in which we compete.
Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available. These forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions, including risks described in the section titled “Risk Factors” and elsewhere in this Form 10-Q and our most recently filed Annual Report on Form 10-K. Other sections of this Form 10-Q may include additional factors that could harm our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk factors nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in, or implied by, any forward-looking statements.
You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements, events, or circumstances. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this report or to conform these statements to actual results or to changes in our expectations. You should read this Form 10-Q and the documents that we have filed as exhibits to this report with the understanding that our actual future results, levels of activity, performance, and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
In addition, statements such as “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and you are cautioned not to unduly rely upon these statements.
Investors and others should note that we may announce material business and financial information to our investors using our investor relations website (investors.affirm.com), our filings with the Securities and Exchange Commission (“SEC”), webcasts, press releases, and conference calls. We use these mediums, including our website, to communicate with investors and the general public about our company, our products, and other issues. It is possible that the information that we make available on our website may be deemed to be material information. We therefore encourage investors and others interested in our company to review the information that we make available on our website. The contents of our website are not incorporated into this filing. We have included our investor relations website address as an inactive textual reference and for convenience only, and do not intend it to be an active link to our website.
Part I - Financial Information
Item 1. Unaudited Financial Statements
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except shares and per share amounts)
| | | | | | | | | | | | | | |
| | March 31, 2022 | | June 30, 2021 |
Assets | | | | |
Cash and cash equivalents | | $ | 2,261,937 | | | $ | 1,466,558 | |
Restricted cash | | 413,628 | | | 226,074 | |
Securities available for sale at fair value | | 617,023 | | | 16,170 | |
Loans held for sale | | 3,618 | | | 13,030 | |
Loans held for investment | | 2,502,860 | | | 2,022,320 | |
Allowance for credit losses | | (159,475) | | | (117,760) | |
Loans held for investment, net | | 2,343,385 | | | 1,904,560 | |
Accounts receivable, net | | 124,614 | | | 91,575 | |
Property, equipment and software, net | | 141,658 | | | 62,499 | |
Goodwill | | 547,393 | | | 516,515 | |
Intangible assets | | 60,890 | | | 67,930 | |
Commercial agreement assets | | 287,129 | | | 227,377 | |
Other assets | | 230,451 | | | 274,679 | |
Total Assets | | $ | 7,031,726 | | | $ | 4,866,967 | |
Liabilities and Stockholders’ Equity | | | | |
Liabilities: | | | | |
Accounts payable | | $ | 48,985 | | | $ | 57,758 | |
Payable to third-party loan owners | | 35,962 | | | 50,079 | |
Accrued interest payable | | 2,992 | | | 2,751 | |
Accrued expenses and other liabilities | | 313,307 | | | 323,577 | |
Convertible senior notes, net | | 1,705,624 | | | — | |
Notes issued by securitization trusts | | 1,447,568 | | | 1,176,673 | |
Funding debt | | 901,233 | | | 680,602 | |
Total liabilities | | 4,455,671 | | | 2,291,440 | |
Commitments and contingencies (Note 8) | | | | |
Stockholders’ equity: | | | | |
Class A common stock, par value $0.00001 per share: 3,030,000,000 shares authorized, 225,617,857 shares issued and outstanding as of March 31, 2022; 3,030,000,000 shares authorized, 181,131,728 shares issued and outstanding as of June 30, 2021 | | 2 | | | 2 | |
Class B common stock, par value $0.00001 per share: 140,000,000 shares authorized, 60,160,468 shares issued and outstanding as of March 31, 2022; 140,000,000 authorized, 88,226,376 shares issued and outstanding as of June 30, 2021 | | 1 | | | 1 | |
Additional paid in capital | | 3,987,881 | | | 3,467,236 | |
Accumulated deficit | | (1,419,506) | | | (898,485) | |
Accumulated other comprehensive gain (loss) | | 7,677 | | | 6,773 | |
Total stockholders’ equity | | 2,576,055 | | | 2,575,527 | |
Total Liabilities and Stockholders’ Equity | | $ | 7,031,726 | | | $ | 4,866,967 | |
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS, CONT.
(Unaudited)
(in thousands, except shares and per share amounts)
The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the interim condensed consolidated balance sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. The liabilities in the table below include liabilities for which creditors do not have recourse to the general credit of the Company. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate upon consolidation.
| | | | | | | | | | | | | | |
| | March 31, 2022 | | June 30, 2021 |
Assets of consolidated VIEs, included in total assets above | | | | |
Restricted cash | | $ | 290,661 | | | $ | 142,385 | |
Loans held for investment | | 2,214,932 | | | 1,743,810 | |
Allowance for credit losses | | (125,115) | | | (94,463) | |
Loans held for investment, net | | 2,089,817 | | | 1,649,347 | |
Accounts receivable, net | | 8,195 | | | 8,209 | |
Other assets | | 12,398 | | | 3,683 | |
Total assets of consolidated VIEs | | $ | 2,401,071 | | | $ | 1,803,624 | |
Liabilities of consolidated VIEs, included in total liabilities above | | | | |
Accounts payable | | $ | 2,960 | | | $ | 2,927 | |
Accrued interest payable | | 2,941 | | | 2,613 | |
Accrued expenses and other liabilities | | 12,433 | | | 3,820 | |
Notes issued by securitization trusts | | 1,447,568 | | | 1,176,673 | |
Funding debt | | 734,430 | | | 607,394 | |
Total liabilities of consolidated VIEs | | 2,200,332 | | | 1,793,427 | |
Total net assets | | $ | 200,739 | | | $ | 10,197 | |
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited)
(in thousands, except share and per share amounts)
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | Nine Months Ended March 31, |
| | 2022 | | 2021 | | 2022 | | 2021 |
Revenue | | | | | | | | |
Merchant network revenue | | $ | 121,054 | | | $ | 97,999 | | | $ | 340,385 | | | $ | 290,894 | |
Virtual card network revenue | | 23,169 | | | 13,809 | | | 69,122 | | | 30,587 | |
Total network revenue | | 144,223 | | | 111,808 | | | 409,507 | | | 321,481 | |
Interest income | | 134,599 | | | 94,530 | | | 390,256 | | | 222,624 | |
Gain on sales of loans | | 52,484 | | | 16,350 | | | 141,153 | | | 47,344 | |
Servicing income | | 23,456 | | | 7,977 | | | 44,242 | | | 17,235 | |
Total Revenue, net | | $ | 354,762 | | | $ | 230,665 | | | $ | 985,158 | | | $ | 608,684 | |
Operating Expenses | | | | | | | | |
Loss on loan purchase commitment | | $ | 46,853 | | | $ | 62,054 | | | $ | 163,796 | | | $ | 195,690 | |
Provision for credit losses | | 66,294 | | | (1,063) | | | 182,581 | | | 40,389 | |
Funding costs | | 15,824 | | | 14,665 | | | 50,277 | | | 37,077 | |
Processing and servicing | | 43,371 | | | 21,368 | | | 110,421 | | | 51,668 | |
Technology and data analytics | | 110,291 | | | 104,806 | | | 283,293 | | | 180,208 | |
Sales and marketing | | 156,214 | | | 58,184 | | | 363,650 | | | 119,878 | |
General and administrative | | 142,466 | | | 179,999 | | | 419,962 | | | 253,188 | |
Total Operating Expenses | | 581,313 | | | 440,013 | | | 1,573,980 | | | 878,098 | |
Operating Loss | | $ | (226,551) | | | $ | (209,348) | | | $ | (588,822) | | | $ | (269,414) | |
Other (expense) income, net | | 172,139 | | | (77,773) | | | 68,507 | | | (48,088) | |
Loss Before Income Taxes | | $ | (54,412) | | | $ | (287,121) | | | $ | (520,315) | | | $ | (317,502) | |
Income tax expense (benefit) | | 259 | | | (70) | | | 706 | | | 105 | |
Net Loss | | $ | (54,671) | | | $ | (287,051) | | | $ | (521,021) | | | $ | (317,607) | |
Other Comprehensive Income (Loss) | | | | | | | | |
Foreign currency translation adjustments | | $ | 5,406 | | | $ | 2,829 | | | $ | 3,945 | | | $ | 5,048 | |
Unrealized gain (loss) on securities available for sale, net | | (2,105) | | | — | | | (3,041) | | | — | |
Net Other Comprehensive Income (Loss) | | 3,301 | | | 2,829 | | | 904 | | | 5,048 | |
Comprehensive Loss | | $ | (51,370) | | | $ | (284,222) | | | $ | (520,117) | | | $ | (312,559) | |
Per share data: | | | | | | | | |
Net loss per share attributable to common stockholders for Class A and Class B | | | | | | | | |
Basic | | $ | (0.19) | | | $ | (1.23) | | | $ | (1.86) | | | $ | (2.60) | |
Diluted | | $ | (0.19) | | | $ | (1.23) | | | $ | (1.86) | | | $ | (2.80) | |
Weighted average common shares outstanding | | | | | | | | |
Basic | | 285,641,820 | | | 233,309,590 | | | 279,570,015 | | | 122,161,508 | |
Diluted | | 285,641,820 | | | 233,309,590 | | | 279,570,015 | | | 123,329,359 | |
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENT OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND
STOCKHOLDERS’ EQUITY (DEFICIT)
(Unaudited)
(in thousands, except share amounts)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Accumulated Other Comprehensive Income (Loss) | | Total Stockholders' Equity (Deficit) |
| | | | | | | Shares | | Amount | | | | |
Balance as of June 30, 2021 | | | | | | | 269,358,104 | | | $ | 3 | | | $ | 3,467,236 | | | $ | (898,485) | | | $ | 6,773 | | | $ | 2,575,527 | |
| | | | | | | | | | | | | | | | | |
Issuance of common stock upon exercise of stock options | | | | | | | 7,403,503 | | | — | | | 37,470 | | | — | | | — | | | 37,470 | |
| | | | | | | | | | | | | | | | | |
Issuance of common stock in acquisition | | | | | | | 183,733 | | | — | | | 10,000 | | | — | | | — | | | 10,000 | |
Vesting of restricted stock units | | | | | | | 772,653 | | | — | | | — | | | — | | | — | | | — | |
Repurchases of common stock | | | | | | | (821) | | | — | | | (4) | | | — | | | — | | | (4) | |
| | | | | | | | | | | | | | | | | |
Stock-based compensation | | | | | | | — | | | — | | | 104,879 | | | — | | | — | | | 104,879 | |
Tax withholding on stock-based compensation | | | | | | | — | | | — | | | (39,817) | | | — | | | — | | | (39,817) | |
| | | | | | | | | | | | | | | | | |
Foreign currency translation adjustments | | | | | | | — | | | — | | | — | | | — | | | (3,802) | | | (3,802) | |
Unrealized gain (loss) on securities available for sale | | | | | | | — | | | — | | | — | | | — | | | (279) | | | (279) | |
Net Loss | | | | | | | — | | | — | | | — | | | (306,615) | | | — | | | (306,615) | |
Balance as of September 30, 2021 | | | | | | | 277,717,172 | | | $ | 3 | | | $ | 3,579,764 | | | $ | (1,205,100) | | | $ | 2,692 | | | $ | 2,377,359 | |
Issuance of common stock upon exercise of stock options | | | | | | | 4,689,973 | | | — | | | 21,674 | | | — | | | — | | | 21,674 | |
Vesting of restricted stock units | | | | | | | 803,263 | | | — | | | — | | | — | | | — | | | — | |
Vesting of warrants for common stock | | | | | | | — | | | — | | | 198,383 | | | — | | | — | | | 198,383 | |
Stock-based compensation | | | | | | | — | | | — | | | 101,920 | | | — | | | — | | | 101,920 | |
Tax withholding on stock-based compensation | | | | | | | — | | | — | | | (72,963) | | | — | | | — | | | (72,963) | |
Foreign currency translation adjustments | | | | | | | — | | | — | | | — | | | — | | | 2,341 | | | 2,341 | |
Unrealized gain (loss) on securities available for sale | | | | | | | — | | | — | | | — | | | — | | | (657) | | | (657) | |
Net Loss | | | | | | | — | | | — | | | — | | | (159,735) | | | — | | | (159,735) | |
Balance as of December 31, 2021 | | | | | | | 283,210,408 | | | $ | 3 | | | $ | 3,828,778 | | | $ | (1,364,835) | | | $ | 4,376 | | | $ | 2,468,322 | |
Issuance of common stock upon exercise of stock options | | | | | | | 1,258,865 | | | — | | | 8,171 | | | — | | | — | | | 8,171 | |
Repurchases of Common Stock | | | | | | | (9,472) | | | — | | | (80) | | | — | | | — | | | (80) | |
Vesting of restricted stock units | | | | | | | 1,318,524 | | | — | | | — | | | — | | | — | | | — | |
Vesting of warrants for common stock | | | | | | | — | | | — | | | 92,169 | | | — | | | — | | | 92,169 | |
Stock-based compensation | | | | | | | — | | | — | | | 113,005 | | | — | | | — | | | 113,005 | |
Tax withholding on stock-based compensation | | | | | | | — | | | — | | | (54,162) | | | — | | | — | | | (54,162) | |
Foreign currency translation adjustments | | | | | | | — | | | — | | | — | | | — | | | 5,406 | | | 5,406 | |
Unrealized gain (loss) on securities available for sale | | | | | | | — | | | — | | | — | | | — | | | (2,105) | | | (2,105) | |
Net Loss | | | | | | | — | | | — | | | — | | | (54,671) | | | — | | | (54,671) | |
Balance as of March 31, 2022 | | | | | | | 285,778,325 | | | $ | 3 | | | $ | 3,987,881 | | | $ | (1,419,506) | | | $ | 7,677 | | | $ | 2,576,055 | |
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENT OF REDEEMABLE CONVERTIBLE PREFERRED STOCK
AND STOCKHOLDERS’ EQUITY (DEFICIT), CONT.
(Unaudited)
(in thousands, except share amounts)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Redeemable Convertible Preferred Stock | | | Common Stock | | Additional Paid-In Capital | | Accumulated Deficit | | Accumulated Other Comprehensive Income (Loss) | | Total Stockholders' Equity (Deficit) |
| | Shares | | Amount | | | Shares | | Amount | | | | |
Balance as of June 30, 2020 | | 122,115,971 | | | $ | 804,170 | | | | 47,684,427 | | | — | | | 80,373 | | | (447,167) | | | (302) | | | $ | (367,096) | |
Issuance of common stock upon exercise of stock option | | — | | | — | | | | 388,246 | | | — | | | 1,741 | | | — | | | — | | | 1,741 | |
Repurchases of common stock | | — | | | — | | | | (115,625) | | | — | | | (584) | | | — | | | — | | | (584) | |
Issuance of redeemable convertible preferred stock, net of issuance costs of $440 | | 21,824,141 | | | 434,434 | | | | — | | | — | | | — | | | — | | | — | | | — | |
Vesting and exercise of warrants for common stock | | — | | | — | | | | 5,074,398 | | | — | | | 67,645 | | | — | | | — | | | 67,645 | |
Stock-based compensation | | — | | | — | | | | — | | | — | | | 7,175 | | | — | | | — | | | 7,175 | |
Conversion of convertible debt | | 4,444,321 | | | 88,559 | | | | — | | | — | | | (42,124) | | | — | | | — | | | (42,124) | |
Effects of adoption of new accounting standards | | — | | | — | | | | — | | | — | | | — | | | (9,980) | | | — | | | (9,980) | |
Foreign currency translation adjustments | | — | | | — | | | | — | | | — | | | — | | | — | | | 405 | | | 405 | |
Net Loss | | — | | | — | | | | — | | | — | | | — | | | (3,946) | | | — | | | (3,946) | |
Balance as of September 30, 2020 | | 148,384,433 | | | 1,327,163 | | | | 53,031,446 | | | $ | — | | | $ | 114,226 | | | $ | (461,093) | | | $ | 103 | | | $ | (346,764) | |
Issuance of common stock upon exercise of stock option | | — | | | — | | | | 6,220,024 | | | — | | | 21,676 | | | — | | | — | | | 21,676 | |
Repurchases of common stock | | — | | | — | | | | (12,100) | | | — | | | (199) | | | — | | | — | | | (199) | |
Issuance of preferred stock, net of issuance costs of $143 | | 12,546 | | | 108 | | | | — | | | — | | | — | | | — | | | — | | | — | |
Stock-based compensation | | — | | | — | | | | — | | | — | | | 6,774 | | | — | | | — | | | 6,774 | |
Foreign currency translation adjustments | | — | | | — | | | | — | | | — | | | — | | | — | | | 1,814 | | | 1,814 | |
Net Loss | | — | | | — | | | | — | | | — | | | — | | | (26,610) | | | — | | | (26,610) | |
Balance as of December 31, 2020 | | 148,396,979 | | | 1,327,271 | | | | 59,239,370 | | | $ | — | | | $ | 142,477 | | | $ | (487,703) | | | $ | 1,917 | | | $ | (343,309) | |
Issuance of common stock upon initial public offering, net | | — | | | — | | | | 28,290,000 | | | 1 | | | 1,305,301 | | | — | | | — | | | 1,305,302 | |
Issuance of common stock upon exercise of stock options | | — | | | — | | | | 4,721,033 | | | — | | | 19,819 | | | — | | | — | | | 19,819 | |
Issuance of common stock upon exercise of warrants | | — | | | — | | | | 15,577,185 | | | — | | | 203,511 | | | — | | | — | | | 203,511 | |
Issuance of common stock in acquisition | | — | | | — | | | | 6,209,806 | | | — | | | 117,023 | | | — | | | — | | | 117,023 | |
Vesting of restricted stock units | | — | | | — | | | | 2,225,411 | | | — | | | — | | | — | | | — | | | — | |
Repurchases of common stock | | — | | | — | | | | (1,666) | | | — | | | (3) | | | — | | | — | | | (3) | |
Conversion of redeemable convertible preferred stock | | (148,396,979) | | | (1,327,271) | | | | 148,396,979 | | | 2 | | | 1,327,269 | | | (11) | | | — | | | 1,327,260 | |
Stock-based compensation | | — | | | — | | | | — | | | — | | | 187,883 | | | — | | | — | | | 187,883 | |
Tax withholding on stock-based compensation | | — | | | — | | | | — | | | — | | | (127,566) | | | — | | | — | | | (127,566) | |
Foreign currency translation adjustments | | — | | | — | | | | — | | | — | | | — | | | — | | | 2,829 | | | 2,829 | |
Net Loss | | — | | | — | | | | — | | | — | | | — | | | (287,051) | | | — | | | (287,051) | |
Balance as of March 31, 2021 | | — | | | — | | | | 264,658,118 | | | $ | 3 | | | $ | 3,175,714 | | | $ | (774,765) | | | $ | 4,746 | | | $ | 2,405,698 | |
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
AFFIRM HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
| | | | | | | | | | | | | | |
| | Nine Months Ended March 31, |
| | 2022 | | 2021 |
Cash Flows from Operating Activities | | | | |
Net Loss | | $ | (521,021) | | | $ | (317,607) | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | |
Provision for credit losses | | 182,581 | | | 40,389 | |
Amortization of premiums and discounts on loans, net | | (129,714) | | | (60,705) | |
Gain on sales of loans | | (141,153) | | | (47,344) | |
Changes in fair value of assets and liabilities | | (38,821) | | | 45,310 | |
Amortization of commercial agreement assets | | 72,804 | | | 50,097 | |
Amortization of debt issuance costs | | 13,215 | | | 3,675 | |
Amortization of discount on securities available for sale | | 968 | | | — | |
Commercial agreement warrant expense | | 157,023 | | | — | |
Stock-based compensation | | 280,113 | | | 192,363 | |
Depreciation and amortization | | 35,607 | | | 12,092 | |
Other | | (5,725) | | | 18,163 | |
Purchases of loans held for sale | | (3,869,327) | | | (1,640,672) | |
Proceeds from the sale of loans held for sale | | 3,868,919 | | | 1,599,554 | |
Change in operating assets and liabilities: | | | | |
Accounts receivable, net | | (42,467) | | | (6,461) | |
Other assets | | 28,018 | | | (208,798) | |
Accounts payable | | (8,773) | | | 4,064 | |
Payable to third-party loan owners | | (14,117) | | | 11,526 | |
Accrued interest payable | | 240 | | | 2,535 | |
Accrued expenses and other liabilities | | 28,545 | | | 128,602 | |
Net Cash Used in Operating Activities | | (103,085) | | | (173,217) | |
Cash Flows from Investing Activities | | | | |
Purchases and origination of loans held for investment | | (7,529,324) | | | (4,313,834) | |
Proceeds from the sale of loans held for investment | | 1,330,341 | | | 348,195 | |
Principal repayments and other loan servicing activity | | 5,867,583 | | | 3,002,351 | |
Acquisition, net of cash and restricted cash acquired | | (5,999) | | | (104,776) | |
Acquisition of commercial agreement assets | | — | | | (25,900) | |
Additions to property, equipment and software | | (59,254) | | | (12,414) | |
Purchases of securities available for sale | | (770,047) | | | — | |
Proceeds from maturities and repayments of securities available for sale | | |