With the business potentially at an important milestone, we thought we'd take a closer look at Affirm Holdings, Inc.'s (NASDAQ:AFRM) future prospects. Affirm Holdings, Inc. operates payment network in the United States, Canada, and internationally. The US$20b market-cap company posted a loss in its most recent financial year of US$518m and a latest trailing-twelve-month loss of US$446m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Affirm Holdings will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Affirm Holdings

According to the 20 industry analysts covering Affirm Holdings, the consensus is that breakeven is near. They expect the company to post a final loss in 2025, before turning a profit of US$153m in 2026. The company is therefore projected to breakeven just over a year from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 61% is expected, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Affirm Holdings' upcoming projects, however, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one issue worth mentioning. Affirm Holdings currently has a debt-to-equity ratio of over 2x. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Affirm Holdings which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Affirm Holdings, take a look at Affirm Holdings' company page on Simply Wall St. We've also put together a list of pertinent aspects you should further research:

1. Historical Track Record: What has Affirm Holdings' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Affirm Holdings' board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.