Can Xsolla Help Affirm Gain an Edge in Gaming Payments?
Affirm Holdings, Inc. AFRM, the leading buy now, pay later (BNPL) solution provider, has entered a new partnership with Xsolla, a prominent gaming company, renowned for driving innovation and shaping the future of video game commerce. This deal unlocks access to Affirm's transparent and flexible payment solutions for game developers, using Xsolla's platform in the United States.
With Affirm built directly into the checkout experience, players can divide their purchases ($50 or more) into biweekly payments at no interest or choose extended monthly plans based on their needs. This gives gamers the freedom to access premium content more affordably. Whether purchasing full games or in-game content, players can choose Affirm at checkout, complete a brief eligibility check, and, once approved, select a customized payment plan. They plan to expand in Canada and the U.K. soon.
Teaming up with Xsolla will help AFRM to expand its footprint in the growing gaming industry, targeting a tech-savvy audience that prefers convenient and adaptable payment options. By embedding its flexible payment solutions into Xsolla's platform, Affirm can boost transaction volumes through frequent in-game and full-game purchases, while also diversifying beyond its traditional retail and travel partners.
This partnership is likely to strengthen Affirm's financial position by unlocking new revenue streams. With players making regular purchases, Affirm can benefit from increased transaction volume, driving up gross merchandise value. By joining Xsolla's large network of game developers and publishers, Affirm can reach more merchants and enhance its brand visibility, which will help it to stay competitive in the growing digital market.
How PayPal and Block Expanding in the BNPL Space?
PayPal Holdings, Inc. PYPL is a major name in the BNPL space. It recently partnered with Selfbook to streamline hotel payments. The integration offers travelers a seamless way to pay using PayPal while unlocking special rates, making bookings more affordable. This move adds value for users and boosts booking performance for hotels, helping PayPal strengthen its position.
Meanwhile, Block, Inc. XYZ is keeping pace in the industry by integrating Afterpay directly into its Cash App debit card, allowing eligible users to split qualifying purchases into biweekly instalments. This move helps Block expand BNPL access into everyday spending, embedding flexible payments right at the point of sale.
Affirm's Price Performance, Valuation and Estimates
Over the past year, AFRM shares have gained 9.8% underperforming the industry and outperforming the Zacks S&P 500 Composite.
From a valuation standpoint, Affirm trades at a forward price-to-sales ratio of 5.49, down from the industry average. AFRM carries a Value Score of F.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Affirm's fiscal 2025 earnings implies a 101.8% improvement year over year, followed by massive growth next year.
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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