Affirm Holdings, Inc. (AFRM) saw its stock plummet 6.68% in pre-market trading on Thursday, as fintech stocks continue to face significant headwinds in 2025. The "buy now, pay later" lender's decline comes amid a broader selloff in the fintech sector, driven by growing economic concerns and regulatory uncertainties.

The sharp drop in Affirm's stock price can be attributed to several factors affecting the fintech industry as a whole. Renewed worries about inflation, exacerbated by President Trump's announcement of reciprocal tariffs on U.S. trade partners, have raised concerns about consumer spending. Additionally, fears of a sluggish U.S. economy or potential recession have led to expectations of reduced demand for consumer loans, directly impacting Affirm's business model.

Analysts are becoming increasingly cautious about the fintech sector's outlook. Goldman Sachs highlighted a "cloudier" macroeconomic picture for fintechs, while other experts point to potential negative wealth effects that could pressure discretionary spending. As investors reassess the valuations of high-growth fintech companies in light of these economic uncertainties, Affirm and its peers may continue to face downward pressure on their stock prices in the near term.