Company: AFRM
Filing Date: 2025-08-28
Form Type: 10-K
Source: 0001820953-25-000080
Chunk: 131

Company: Affirm Holdings, Inc.
Filing Date: 2025-08-28
Form: 10-K
Item: Item 7
Chunk 131
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 as well as our contractual interest rate and distribution of loans across funding facilities, net of the impact of any designated cash flow hedges. 

Funding costs for the year ended June 30, 2025 increased by $81.2 million or 24%, compared to the same period in 2024. The increase was primarily due to an increase of funding debt and notes issued by securitization trusts during the year ended June 30, 2025. The average total of funding debt from warehouses and securitizations for the year ended June 30, 2025 was $5.9 billion compared to $4.5 billion during the same period in 2024, an increase of $1.4 billion, or 30%. The increase was also attributable to a larger volume of on-balance sheet loans being retained during the period. The average on-balance sheet loan balance was $6.5 billion for the year ended June 30, 2025, respectively, an increase of 28% compared to $5.1 billion during the same period in 2024.

Processing and Servicing

Processing and servicing expense consists primarily of payment processing fees, third-party customer support and collection expense, salaries and personnel-related costs of our customer care team, platform fees, and allocated overhead. 

Processing and servicing expense for the year ended June 30, 2025 increased by $114.6 million, or 33%, compared to the same period in 2024. This increase was primarily driven by an increase in payment processing fees of $69.5 million, or 36%, related to an increase of $8.6 billion, or 36%, in payment volume for the year ended June 30, 2025, compared to the same period in 2024. During the year ended June 30, 2025, our platform fees increased by $29.3 million, or 37%, due to an increase in volume with a large enterprise partner. Additionally, our customer service and collection fee costs increased by $22.5 million, or 47%, compared to the same period in 2024. This is driven by growth in our overall loan portfolio, including both loans held for investment and loans serviced for third parties, due to the increase in the number of consumer transactions. The number of consumer transactions 

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increased by 47% during the year ended June 30, 2025, from continued growth at our merchants and platform partners