2023-06-07 15:42:23 ET
Affirm Holdings Inc ( NASDAQ: AFRM ) is trading up today after the financial technology company doubled down on working with Amazon.com Inc ( NASDAQ: AMZN ).
Affirm already had an affiliation with Amazon
On Wednesday, the California-based company said U.S. merchants who use Amazon Pay will now be able to add its “Adaptive Checkout” as a payment option.
The buy-now-pay-later option is already available to customers on the Amazon website and the Amazon mobile app. In the press release , Libor Michalek – the President of Affirm Holdings Inc said:
By integrating Adaptive Checkout, thousands of merchants can offer customers personalised payment options and increased spending power through Amazon Pay’s convenient and secure checkout experience.
Earlier this year, the Nasdaq-listed firm trimmed its workforce by 19% to cut costs and be competitive against rivals like Klarna, Block, and PayPal.
SVB MoffettNathanson analyst reacts to the news
Unfortunately, though, Eugne Simuni – an SVB MoffettNathanson analyst does not expect today’s announcement to materially help Affirm Holdings in terms of operating performance.
To get more constructive on the name, we are looking for a significant and consistent (multi-quarter) improvement in two key operating metrics: originations growth and gross-profit yields.
Simuni left his $17 price target on Affirm stock unchanged on Wednesday as he sees Amazon as an unlikely catalyst to boost either of those metrics.
Still, it’s noteworthy that the fintech last month reported better-than-expected results for its first financial quarter on the back of higher interest income. At writing, its shares are down more than 20% versus their year-to-date high.
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