Is Affirm's Australia Comeback a Meaningful Growth Catalyst?

Affirm Holdings, Inc. AFRM recently expanded its partnership with Shopify by launching Shop Pay Installments in Australia. The service is powered exclusively by Affirm and sits inside Shopify’s Shop Pay checkout. Affirm makes a real-time underwriting decision on every transaction and does not charge late fees, account fees or compounding interest. The launch marks the company’s return to Australia after it wound down operations there in 2023 as part of a broader effort to focus on growth and profitability.

The re-entry gives Affirm access to Shopify’s Australian merchant base while advancing a broader global partnership already spanning the United States, Canada and the U.K., with further expansion planned across Western Europe. AFRM can help merchants boost conversions and basket sizes by making larger purchases easier for customers to manage.

Shop Pay has more than 250 million buyers globally, while over 90% of Affirm purchases in North America come from repeat customers. That creates a large channel and strengthens Affirm’s international expansion opportunity over time.

The Australian rollout is expected to add GMV and transaction-driven revenue as adoption builds, while also widening Affirm’s merchant network. In fourth quarter fiscal 2026, GMV jumped 36% to $14.1 billion, revenues rose 33% to $1.17 billion and revenue less transaction costs increased 39% to $589 million.

Active consumers climbed 21% to 27.8 million, while transaction per active consumer grew 20%, giving Affirm a larger base for international growth and recurring transaction volume across new markets over time. Also, active merchant count surged 51% to 571,000 as of June 30, 2026.

How Are Peers Placed?

Affirm is going back to a competitive Australian BNPL market, where several companies already have established positions. PayPal Holdings Inc. PYPL has considerable reach through Pay in 4. PayPal says the product is available across more than 9 million active Australian PayPal accounts, while its 2025 survey showed usage among 51% of Australian BNPL users, up from 45% a year earlier.

Meanwhile, Block, Inc. XYZ is one of the strongest competitors through Afterpay, which originated in Australia. Afterpay currently cites about 4.4 million active consumers in Australia and New Zealand. PayPal’s 2025 Australian survey found that 78% of Australian BNPL users had used Afterpay in the prior six months.

Affirm’s Price Performance, Valuation and Estimates

Shares of Affirm have gained 4.1% year to date, outperforming the broader industry but trailing the S&P 500 Index.

Affirm’s YTD Price Performance

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From a valuation standpoint, Affirm trades at a forward price-to-earnings ratio of 41.42X, up from the industry average of 27.93X. AFRM carries a Value Score of D.

It beat earnings estimates in each of the past four quarters, with an average surprise of 379.4%.

Affirm Holdings, Inc. Price, Consensus and EPS Surprise

Affirm Holdings, Inc. price-consensus-eps-surprise-chart | Affirm Holdings, Inc. Quote

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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