QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
☒ | Accelerated filer | ☐ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company |
Page | ||||||||
December 31, 2022 | June 30, 2022 | |||||||||||||
Assets | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash | ||||||||||||||
Securities available for sale at fair value | ||||||||||||||
Loans held for sale | ||||||||||||||
Loans held for investment | ||||||||||||||
Allowance for credit losses | ( | ( | ||||||||||||
Loans held for investment, net | ||||||||||||||
Accounts receivable, net | ||||||||||||||
Property, equipment and software, net | ||||||||||||||
Goodwill | ||||||||||||||
Intangible assets | ||||||||||||||
Commercial agreement assets | ||||||||||||||
Other assets | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||
Liabilities: | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Payable to third-party loan owners | ||||||||||||||
Accrued interest payable | ||||||||||||||
Accrued expenses and other liabilities | ||||||||||||||
Convertible senior notes, net | ||||||||||||||
Notes issued by securitization trusts | ||||||||||||||
Funding debt | ||||||||||||||
Total liabilities | ||||||||||||||
Commitments and contingencies (Note 8) | ||||||||||||||
Stockholders’ equity: | ||||||||||||||
Class A common stock, par value $ | ||||||||||||||
Class B common stock, par value $ | ||||||||||||||
Additional paid in capital | ||||||||||||||
Accumulated deficit | ( | ( | ||||||||||||
Accumulated other comprehensive loss | ( | ( | ||||||||||||
Total stockholders’ equity | ||||||||||||||
Total Liabilities and Stockholders’ Equity | $ | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Assets of consolidated VIEs, included in total assets above | ||||||||||||||
Restricted cash | $ | $ | ||||||||||||
Loans held for investment | ||||||||||||||
Allowance for credit losses | ( | ( | ||||||||||||
Loans held for investment, net | ||||||||||||||
Accounts receivable, net | ||||||||||||||
Other assets | ||||||||||||||
Total assets of consolidated VIEs | $ | $ | ||||||||||||
Liabilities of consolidated VIEs, included in total liabilities above | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued interest payable | ||||||||||||||
Accrued expenses and other liabilities | ||||||||||||||
Notes issued by securitization trusts | ||||||||||||||
Funding debt | ||||||||||||||
Total liabilities of consolidated VIEs | ||||||||||||||
Total net assets | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Revenue | ||||||||||||||||||||||||||
Merchant network revenue | $ | $ | $ | $ | ||||||||||||||||||||||
Virtual card network revenue | ||||||||||||||||||||||||||
Total network revenue | ||||||||||||||||||||||||||
Interest income | ||||||||||||||||||||||||||
Gain on sales of loans | ||||||||||||||||||||||||||
Servicing income | ||||||||||||||||||||||||||
Total Revenue, net | $ | $ | $ | $ | ||||||||||||||||||||||
Operating Expenses | ||||||||||||||||||||||||||
Loss on loan purchase commitment | $ | $ | $ | $ | ||||||||||||||||||||||
Provision for credit losses | ||||||||||||||||||||||||||
Funding costs | ||||||||||||||||||||||||||
Processing and servicing | ||||||||||||||||||||||||||
Technology and data analytics | ||||||||||||||||||||||||||
Sales and marketing | ||||||||||||||||||||||||||
General and administrative | ||||||||||||||||||||||||||
Total Operating Expenses | ||||||||||||||||||||||||||
Operating Loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Other income (expense), net | ( | |||||||||||||||||||||||||
Loss Before Income Taxes | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Income tax (benefit) expense | ( | ( | ||||||||||||||||||||||||
Net Loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Other Comprehensive Loss | ||||||||||||||||||||||||||
Foreign currency translation adjustments | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||
Unrealized loss on securities available for sale, net | ( | ( | ( | |||||||||||||||||||||||
Net Other Comprehensive Loss | ( | ( | ||||||||||||||||||||||||
Comprehensive Loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Per share data: | ||||||||||||||||||||||||||
Net loss per share attributable to common stockholders for Class A and Class B | ||||||||||||||||||||||||||
Basic | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Diluted | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Weighted average common shares outstanding | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Diluted |
Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2022 | $ | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | — | — | — | |||||||||||||||||||||||||||||||||||
Forfeiture of common stock related to acquisitions | ( | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Repurchases of Common Stock | ( | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Vesting of restricted stock units | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Vesting of warrants for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | ||||||||||||||||||||||||||||||||||
Tax withholding on stock-based compensation | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Net Loss | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance as of September 30, 2022 | $ | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | — | — | — | |||||||||||||||||||||||||||||||||||
Issuance of common stock, employee share purchase plan | — | — | — | |||||||||||||||||||||||||||||||||||
Vesting of restricted stock units | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Vesting of warrants for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | ||||||||||||||||||||||||||||||||||
Tax withholding on stock-based compensation | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | ||||||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale | — | — | — | — | ||||||||||||||||||||||||||||||||||
Net Loss | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2022 | $ | $ | $ | ( | $ | ( | $ |
Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2021 | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | — | — | — | |||||||||||||||||||||||||||||||||||
Issuance of common stock in acquisition | — | — | — | |||||||||||||||||||||||||||||||||||
Vesting of restricted stock units | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | ||||||||||||||||||||||||||||||||||
Tax withholding on stock-based compensation | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Net Loss | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance as of September 30, 2021 | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | — | — | — | |||||||||||||||||||||||||||||||||||
Vesting of restricted stock units | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Vesting of warrants for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | ||||||||||||||||||||||||||||||||||
Tax withholding on stock-based compensation | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | — | ||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on securities available for sale | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Net Loss | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2021 | $ | $ | $ | ( | $ | $ |
Six Months Ended December 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Cash Flows from Operating Activities | ||||||||||||||
Net Loss | $ | ( | $ | ( | ||||||||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||||
Provision for credit losses | ||||||||||||||
Amortization of premiums and discounts on loans, net | ( | ( | ||||||||||||
Gain on sales of loans | ( | ( | ||||||||||||
Changes in fair value of assets and liabilities | ( | |||||||||||||
Amortization of commercial agreement assets | ||||||||||||||
Amortization of debt issuance costs | ||||||||||||||
Amortization of discount on securities available for sale | ( | |||||||||||||
Commercial agreement warrant expense | ||||||||||||||
Stock-based compensation | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Other | ( | |||||||||||||
Change in operating assets and liabilities: | ||||||||||||||
Purchases of loans held for sale | ( | ( | ||||||||||||
Proceeds from the sale of loans held for sale | ||||||||||||||
Accounts receivable, net | ( | ( | ||||||||||||
Other assets | ( | |||||||||||||
Accounts payable | ( | ( | ||||||||||||
Payable to third-party loan owners | ||||||||||||||
Accrued interest payable | ( | |||||||||||||
Accrued expenses and other liabilities | ( | |||||||||||||
Net Cash Provided by (Used in) Operating Activities | ( | |||||||||||||
Cash Flows from Investing Activities | ||||||||||||||
Purchases and origination of loans held for investment | ( | ( | ||||||||||||
Proceeds from the sale of loans held for investment | ||||||||||||||
Principal repayments and other loan servicing activity | ||||||||||||||
Acquisition, net of cash and restricted cash acquired | ( | |||||||||||||
Additions to property, equipment and software | ( | ( | ||||||||||||
Purchases of securities available for sale | ( | ( | ||||||||||||
Proceeds from maturities and repayments of securities available for sale | ||||||||||||||
Other investing cash inflows (outflows) | ( | |||||||||||||
Net Cash Used in Investing Activities | ( | ( | ||||||||||||
Cash Flows from Financing Activities | ||||||||||||||
Proceeds from issuance of convertible debt, net | ||||||||||||||
Proceeds from funding debt | ||||||||||||||
Payment of debt issuance costs | ( | ( | ||||||||||||
Principal repayments of funding debt | ( | ( | ||||||||||||
Proceeds from issuance of notes and residual trust certificates by securitization trusts | ||||||||||||||
Principal repayments of notes issued by securitization trusts | ( | ( | ||||||||||||
Proceeds from exercise of common stock options and warrants and contributions to ESPP | ||||||||||||||
Repurchases of common stock | ( | ( | ||||||||||||
Payments of tax withholding for stock-based compensation | ( | ( | ||||||||||||
Net Cash Provided by Financing Activities | ||||||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | ( | |||||||||||||
Net Increase in Cash, Cash Equivalents and Restricted Cash | ||||||||||||||
Cash, Cash equivalents and Restricted cash, Beginning of period | ||||||||||||||
Cash, Cash Equivalents and Restricted Cash, End of Period | $ | $ |
Six Months Ended December 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Reconciliation to amounts on consolidated balance sheets (as of period end) | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Restricted cash | ||||||||||||||
Total Cash, Cash Equivalents and Restricted Cash | $ | $ |
Six Months Ended December 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Supplemental Disclosures of Cash Flow Information | ||||||||||||||
Cash payments for interest expense | $ | $ | ||||||||||||
Cash paid for operating leases | ||||||||||||||
Cash paid for income taxes | ||||||||||||||
Supplemental Disclosures of Non-Cash Investing and Financing Activities | ||||||||||||||
Stock-based compensation included in capitalized internal-use software | ||||||||||||||
Issuance of common stock in connection with acquisition | ||||||||||||||
Additions to property and equipment included in accrued expenses | ||||||||||||||
Right of use assets obtained in exchange for operating lease liabilities | ||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Merchant network revenue | $ | $ | $ | $ | |||||||||||||||||||
Virtual card network revenue | |||||||||||||||||||||||
Interest income | |||||||||||||||||||||||
Gain on sales of loans | |||||||||||||||||||||||
Servicing income | |||||||||||||||||||||||
Total Revenue, net | $ | $ | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Interest income on unpaid principal balance | $ | $ | $ | $ | ||||||||||||||||||||||
Amortization of discount on loans | ||||||||||||||||||||||||||
Amortization of premiums on loans | ( | ( | ( | ( | ||||||||||||||||||||||
Interest receivable charged-off, net of recoveries | ( | ( | ( | ( | ||||||||||||||||||||||
Total interest income | $ | $ | $ | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Unpaid principal balance | $ | $ | ||||||||||||
Accrued interest receivable | ||||||||||||||
Premiums on loans held for investment | ||||||||||||||
Less: Discount due to loss on loan purchase commitment | ( | ( | ||||||||||||
Less: Discount due to loss on directly originated loans | ( | ( | ||||||||||||
Less: Fair value adjustment on loans acquired through business combination | ( | ( | ||||||||||||
Total loans held for investment | $ | $ |
December 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Amortized Costs Basis by Fiscal Year of Origination | ||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2021 | 2020 | 2019 | Prior | Total | ||||||||||||||||||||||||||||||||||||||
96+ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
94-96 | ||||||||||||||||||||||||||||||||||||||||||||
90-94 | ||||||||||||||||||||||||||||||||||||||||||||
<90 | ||||||||||||||||||||||||||||||||||||||||||||
No score(1) | ||||||||||||||||||||||||||||||||||||||||||||
Total amortized cost basis | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Net Charge-offs by Fiscal Year of Origination | ||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | 2021 | 2020 | 2019 | Prior | Total | ||||||||||||||||||||||||||||||||||||||
Current period charge-offs | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
Current period recoveries | ||||||||||||||||||||||||||||||||||||||||||||
Current period net charge-offs | $ | ( | $ | ( | $ | ( | $ | $ | $ | $ | ( |
June 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Amortized Costs Basis by Fiscal Year of Origination | ||||||||||||||||||||||||||||||||||||||||||||
2022 | 2021 | 2020 | 2019 | 2018 | Prior | Total | ||||||||||||||||||||||||||||||||||||||
96+ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
94-96 | ||||||||||||||||||||||||||||||||||||||||||||
90-94 | ||||||||||||||||||||||||||||||||||||||||||||
<90 | ||||||||||||||||||||||||||||||||||||||||||||
No score | ||||||||||||||||||||||||||||||||||||||||||||
Total amortized cost basis | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
December 31, 2022 | June 30, 2022 | |||||||||||||
Non-delinquent loans | $ | $ | ||||||||||||
4 – 29 calendar days past due | ||||||||||||||
30 – 59 calendar days past due | ||||||||||||||
60 – 89 calendar days past due | ||||||||||||||
90 – 119 calendar days past due (1) | ||||||||||||||
Total amortized cost basis | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Balance at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Provision for credit losses | ||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ||||||||||||||||||||||
Recoveries of charged-off receivables | ||||||||||||||||||||||||||
Balance at end of period | $ | $ | $ | $ |
Cash | $ | |||||||
Fair value of Class A common stock transferred | ||||||||
Total acquisition date fair value of the consideration transferred | $ |
Intangible assets | $ | |||||||
Total net assets acquired | ||||||||
Goodwill | ||||||||
Total purchase price | $ |
Fair Value | Useful Life (in years) | |||||||||||||
Developed technology | $ |
Assembled workforce | $ | |||||||
Option to purchase developed technology | $ | |||||||
Total | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Internally developed software | $ | $ | ||||||||||||
Leasehold improvements | ||||||||||||||
Computer equipment | ||||||||||||||
Furniture and equipment | ||||||||||||||
Total Property, equipment and software, at cost | $ | $ | ||||||||||||
Less: Accumulated depreciation and amortization | ( | ( | ||||||||||||
Total Property, equipment and software, net | $ | $ |
Balance as of June 30, 2022 | $ | |||||||
Additions | ||||||||
Effect of foreign currency translation | ( | |||||||
Balance as of December 31, 2022 | $ |
December 31, 2022 | ||||||||||||||||||||||||||
Gross | Accumulated Amortization | Net | Weighted Average Remaining Useful Life (in years) | |||||||||||||||||||||||
Merchant relationships | $ | $ | ( | $ | ||||||||||||||||||||||
Developed technology (1) | ( | |||||||||||||||||||||||||
Assembled workforce | ( | |||||||||||||||||||||||||
Trademarks and domains, definite | ( | |||||||||||||||||||||||||
Trademarks and domains, indefinite | — | Indefinite | ||||||||||||||||||||||||
Other intangibles | — | Indefinite | ||||||||||||||||||||||||
Total intangible assets | $ | $ | ( | $ |
June 30, 2022 | ||||||||||||||||||||||||||
Gross | Accumulated Amortization | Net | Weighted Average Remaining Useful Life (in years) | |||||||||||||||||||||||
Merchant relationships | $ | $ | ( | $ | ||||||||||||||||||||||
Developed technology (1) | ( | |||||||||||||||||||||||||
Assembled workforce | ( | |||||||||||||||||||||||||
Trademarks and domains, definite | ( | |||||||||||||||||||||||||
Trademarks and domains, indefinite | — | Indefinite | ||||||||||||||||||||||||
Other intangibles | — | Indefinite | ||||||||||||||||||||||||
Total intangible assets | $ | $ | ( | $ |
2023 (remaining six months) | $ | |||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
2027 and thereafter | ||||||||
Total amortization expense | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Derivative instruments | $ | $ | ||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Equity securities, at cost | ||||||||||||||
Processing reserves | ||||||||||||||
Prepaid expenses | ||||||||||||||
Prepaid payroll taxes for stock-based compensation | ||||||||||||||
Other receivables | ||||||||||||||
Other assets | ||||||||||||||
Total other assets | $ | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Collateral held for derivative instruments | $ | $ | ||||||||||||
Operating lease liability | ||||||||||||||
Accrued expenses | ||||||||||||||
Contingent consideration liability | ||||||||||||||
Other liabilities | ||||||||||||||
Total accrued expenses and other liabilities | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Operating lease expense | $ | $ | $ | $ | ||||||||||||||||||||||
December 31, 2022 | ||||||||
Weighted average remaining lease term (in years) | ||||||||
Weighted average discount rate |
2023 (remaining six months) | $ | |||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
2027 and thereafter | ||||||||
Total lease payments | ||||||||
Less imputed interest | ( | |||||||
Present value of lease liabilities | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
2023 | $ | $ | ||||||||||||
2024 | ||||||||||||||
2025 | ||||||||||||||
2026 | ||||||||||||||
2027 and thereafter | ||||||||||||||
Total | $ | $ | ||||||||||||
Deferred debt issuance costs | ( | ( | ||||||||||||
Total funding debt, net of deferred debt issuance costs | $ | $ |
Principal Amount | Unamortized Discount and Issuance Cost | Net Carrying Amount | |||||||||||||||
Convertible Senior Notes | $ | $ | ( | $ |
December 31, 2022 | ||||||||||||||||||||
Assets | Liabilities | Net Assets | ||||||||||||||||||
Warehouse credit facilities | $ | $ | $ | |||||||||||||||||
Securitizations | ||||||||||||||||||||
Total consolidated VIEs | $ | $ | $ |
June 30, 2022 | ||||||||||||||||||||
Assets | Liabilities | Net Assets | ||||||||||||||||||
Warehouse credit facilities | $ | $ | $ | |||||||||||||||||
Securitizations | ||||||||||||||||||||
Total consolidated VIEs | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||||||||
Assets | Liabilities | Net Assets | Maximum Exposure to Losses | |||||||||||||||||||||||
Securitizations | $ | $ | $ | $ | ||||||||||||||||||||||
Total unconsolidated VIEs | $ | $ | $ | $ |
June 30, 2022 | ||||||||||||||||||||||||||
Assets | Liabilities | Net Assets | Maximum Exposure to Losses | |||||||||||||||||||||||
Securitizations | $ | $ | $ | $ | ||||||||||||||||||||||
Total unconsolidated VIEs | $ | $ | $ | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Cash and cash equivalents: | ||||||||||||||
Money market funds | $ | $ | ||||||||||||
Certificates of deposit | ||||||||||||||
Commercial paper | ||||||||||||||
Government bonds | ||||||||||||||
US | ||||||||||||||
Securities available for sale: | ||||||||||||||
Certificates of deposit | ||||||||||||||
Corporate bonds | ||||||||||||||
Commercial paper | ||||||||||||||
Government bonds | ||||||||||||||
Non-US | ||||||||||||||
US | ||||||||||||||
Securitization notes receivable and certificates (1) | ||||||||||||||
Other | $ | |||||||||||||
Total marketable securities: | $ | $ |
December 31, 2022 | ||||||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Allowance for Credit Losses | Fair Value | ||||||||||||||||||||||||||||
Certificates of deposit (1) | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||
Corporate bonds (1) | ( | |||||||||||||||||||||||||||||||
Commercial paper (1) | ( | |||||||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||||||||
Non-US | ( | |||||||||||||||||||||||||||||||
US (1) | ( | |||||||||||||||||||||||||||||||
Securitization notes receivable and certificates (2) | ( | ( | ||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||
Total securities available for sale | $ | $ | $ | ( | $ | ( | $ |
June 30, 2022 | ||||||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Allowance for Credit Losses | Fair Value | ||||||||||||||||||||||||||||
Certificates of deposit (1) | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||
Corporate bonds (1) | ( | |||||||||||||||||||||||||||||||
Commercial paper (1) | ( | |||||||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||||||||
Non-US | ( | |||||||||||||||||||||||||||||||
US (1) | ( | |||||||||||||||||||||||||||||||
Securitization notes receivable and certificates (2) | ( | ( | ||||||||||||||||||||||||||||||
Total securities available for sale | $ | $ | $ | ( | $ | ( | $ |
December 31, 2022 | ||||||||||||||||||||||||||||||||||||||
Less than or equal to 1 year | Greater than 1 year | Total | ||||||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||||||||
Certificates of deposit | $ | $ | ( | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Commercial paper | ( | ( | ||||||||||||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||||||||||||||
Non-US | ( | ( | ( | |||||||||||||||||||||||||||||||||||
US | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Total securities available for sale (1) | $ | $ | ( | $ | $ | ( | $ | $ | ( |
June 30, 2022 | ||||||||||||||||||||||||||||||||||||||
Less than or equal to 1 year | Greater than 1 year | Total | ||||||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||||||||
Certificates of deposit | $ | $ | ( | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ||||||||||||||||||||||||||||||||||||
Commercial paper | ( | ( | ||||||||||||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||||||||||||||
Non-US | ( | ( | ||||||||||||||||||||||||||||||||||||
US | ( | ( | ||||||||||||||||||||||||||||||||||||
Securitization notes receivable and certificates | ( | ( | ||||||||||||||||||||||||||||||||||||
Total securities available for sale (1) | $ | $ | ( | $ | $ | $ | $ | ( |
December 31, 2022 | ||||||||||||||||||||||||||||||||||||||
Within 1 year | Greater than 1 year, less than or equal to 5 years | Total | ||||||||||||||||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||||||||||||||||
Certificates of deposit (2) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Corporate bonds (2) | ||||||||||||||||||||||||||||||||||||||
Commercial paper (2) | ||||||||||||||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||||||||||||||
Non-US | ||||||||||||||||||||||||||||||||||||||
US (2) | ||||||||||||||||||||||||||||||||||||||
Securitization notes receivable and certificates (1) | ||||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Total securities available for sale | $ | $ | $ | $ | $ | $ |
June 30, 2022 | ||||||||||||||||||||||||||||||||||||||
Within 1 year | Greater than 1 year, less than or equal to 5 years | Total | ||||||||||||||||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||||||||||||||||
Certificates of deposit (2) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Corporate bonds (2) | ||||||||||||||||||||||||||||||||||||||
Commercial paper (2) | ||||||||||||||||||||||||||||||||||||||
Government bonds | ||||||||||||||||||||||||||||||||||||||
Non-US | ||||||||||||||||||||||||||||||||||||||
US (2) | ||||||||||||||||||||||||||||||||||||||
Securitization notes receivable and certificates (1) | ||||||||||||||||||||||||||||||||||||||
Total securities available for sale | $ | $ | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||||||||||||
Money market funds | $ | $ | $ | $ | ||||||||||||||||||||||
Government bonds - U.S. | ||||||||||||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||||||
Certificate of deposit | ||||||||||||||||||||||||||
Corporate bonds | ||||||||||||||||||||||||||
Commercial paper | ||||||||||||||||||||||||||
Government bonds: | ||||||||||||||||||||||||||
Non-U.S. | ||||||||||||||||||||||||||
U.S. | ||||||||||||||||||||||||||
Securitization notes receivable and residual trust certificates | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Servicing assets | ||||||||||||||||||||||||||
Derivative instruments | ||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | ||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Servicing liabilities | $ | $ | $ | $ | ||||||||||||||||||||||
Performance fee liability | ||||||||||||||||||||||||||
Residual trust certificates, held by third-parties | ||||||||||||||||||||||||||
Contingent consideration | ||||||||||||||||||||||||||
Profit share liability | ||||||||||||||||||||||||||
Total liabilities | $ | $ | $ | $ |
June 30, 2022 | ||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||||||||||||
Money market funds | $ | $ | $ | $ | ||||||||||||||||||||||
Certificates of deposit | ||||||||||||||||||||||||||
Commercial paper | ||||||||||||||||||||||||||
Government bonds - U.S. | ||||||||||||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||||||
Certificate of deposit | ||||||||||||||||||||||||||
Corporate bonds | ||||||||||||||||||||||||||
Commercial paper | ||||||||||||||||||||||||||
Government bonds: | ||||||||||||||||||||||||||
Non-U.S. | ||||||||||||||||||||||||||
U.S. | ||||||||||||||||||||||||||
Securitization notes receivable and residual trust certificates | ||||||||||||||||||||||||||
Servicing assets | ||||||||||||||||||||||||||
Derivative instruments | ||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | ||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Servicing liabilities | $ | $ | $ | $ | ||||||||||||||||||||||
Performance fee liability | ||||||||||||||||||||||||||
Residual trust certificates, held by third-parties | ||||||||||||||||||||||||||
Contingent consideration | ||||||||||||||||||||||||||
Profit share liability | ||||||||||||||||||||||||||
Total liabilities | $ | $ | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Initial transfers of financial assets | ||||||||||||||||||||||||||
Subsequent changes in fair value | ( | ( | ( | ( | ||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Initial transfers of financial assets | ||||||||||||||||||||||||||
Subsequent changes in fair value | ( | ( | ( | ( | ||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||||||||
Servicing assets | Discount rate | % | % | % | ||||||||||||||||||||||
Adequate compensation (1) | % | % | % | |||||||||||||||||||||||
Gross default rate (2) | % | % | % | |||||||||||||||||||||||
Servicing liabilities | Discount rate | % | % | % | ||||||||||||||||||||||
Adequate compensation (1) | % | % | % | |||||||||||||||||||||||
Gross default rate (2) | % | % | % |
June 30, 2022 | ||||||||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||||||||
Servicing assets | Discount rate | % | % | % | ||||||||||||||||||||||
Adequate compensation(1) | % | % | % | |||||||||||||||||||||||
Gross default rate (2) | % | % | % | |||||||||||||||||||||||
Servicing liabilities | Discount rate | % | % | % | ||||||||||||||||||||||
Adequate compensation(1) | % | % | % | |||||||||||||||||||||||
Gross default rate (2) | % | % | % |
December 31, 2022 | June 30, 2022 | |||||||||||||
Servicing assets | ||||||||||||||
Gross default rate assumption: | ||||||||||||||
Gross default rate increase of 25% | $ | ( | $ | |||||||||||
Gross default rate increase of 50% | $ | ( | $ | |||||||||||
Adequate compensation assumption: | ||||||||||||||
Adequate compensation increase of 10% | $ | ( | $ | |||||||||||
Adequate compensation increase of 20% | $ | ( | $ | |||||||||||
Adequate compensation increase of 25% | $ | $ | ( | |||||||||||
Adequate compensation increase of 50% | $ | $ | ( | |||||||||||
Discount rate assumption: | ||||||||||||||
Discount rate increase of 25% | $ | ( | $ | ( | ||||||||||
Discount rate increase of 50% | $ | ( | $ | ( | ||||||||||
Servicing liabilities | ||||||||||||||
Gross default rate assumption: | ||||||||||||||
Gross default rate increase of 25% | $ | ( | $ | ( | ||||||||||
Gross default rate increase of 50% | $ | ( | $ | ( | ||||||||||
Adequate compensation assumption: | ||||||||||||||
Adequate compensation increase of 10% | $ | $ | ||||||||||||
Adequate compensation increase of 20% | $ | $ | ||||||||||||
Adequate compensation increase of 25% | $ | $ | ||||||||||||
Adequate compensation increase of 50% | $ | $ | ||||||||||||
Discount rate assumption: | ||||||||||||||
Discount rate increase of 25% | $ | ( | $ | ( | ||||||||||
Discount rate increase of 50% | $ | ( | $ | ( |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Purchases of loans | ||||||||||||||||||||||||||
Settlements Paid | ( | ( | ||||||||||||||||||||||||
Subsequent changes in fair value | ( | ( | ( | |||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Refund rate | ||||||||||||||||||||
Default rate |
June 30, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Refund rate | ||||||||||||||||||||
Default rate |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Repayments | ( | ( | ( | ( | ||||||||||||||||||||||
Subsequent changes in fair value | ||||||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Loss rate | ||||||||||||||||||||
Prepayment rate |
June 30, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Loss rate | ||||||||||||||||||||
Prepayment rate |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Additions | ||||||||||||||||||||||||||
Cash received (due to payments or sales) | ( | ( | ( | ( | ||||||||||||||||||||||
Change in unrealized gain (loss) | ( | ( | ( | |||||||||||||||||||||||
Accrued interest | ||||||||||||||||||||||||||
Reversal of (impairment on) securities available for sale | ( | ( | ( | ( | ||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Loss rate | ||||||||||||||||||||
Prepayment rate |
June 30, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Loss rate | ||||||||||||||||||||
Prepayment rate |
December 31, 2022 | June 30, 2022 | |||||||||||||
Discount rate assumption: | ||||||||||||||
Discount rate increase of 25% | $ | ( | $ | ( | ||||||||||
Discount rate increase of 50% | $ | ( | $ | ( | ||||||||||
Loss rate assumption: | ||||||||||||||
Loss rate increase of 25% | $ | ( | $ | ( | ||||||||||
Loss rate increase of 50% | $ | ( | $ | ( | ||||||||||
Prepayment rate assumption: | ||||||||||||||
Prepayment rate decrease of 25% | $ | ( | $ | ( | ||||||||||
Prepayment rate decrease of 50% | $ | ( | $ | ( |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Subsequent changes in fair value | ( | ( | ( | |||||||||||||||||||||||
Effect of foreign currency translation | ( | ( | ( | |||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Fair value at beginning of period | $ | $ | $ | $ | ||||||||||||||||||||||
Facilitation of loans | ||||||||||||||||||||||||||
Actual performance | ( | ( | ( | |||||||||||||||||||||||
Subsequent changes in fair value | ( | ( | ( | |||||||||||||||||||||||
Fair value at end of period | $ | $ | $ | $ |
December 31, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Program profitability |
June 30, 2022 | ||||||||||||||||||||
Unobservable Input | Minimum | Maximum | Weighted Average | |||||||||||||||||
Discount rate | ||||||||||||||||||||
Program profitability |
December 31, 2022 | ||||||||||||||||||||||||||||||||
Carrying Amount | Level 1 | Level 2 | Level 3 | Balance at Fair Value | ||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Loans held for sale | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Loans held for investment, net | ||||||||||||||||||||||||||||||||
Other assets | ||||||||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Convertible senior notes, net (1) | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Notes issued by securitization trusts | ||||||||||||||||||||||||||||||||
Funding debt (2) | ||||||||||||||||||||||||||||||||
Total liabilities | $ | $ | $ | $ | $ |
June 30, 2022 | ||||||||||||||||||||||||||||||||
Carrying Amount | Level 1 | Level 2 | Level 3 | Balance at Fair Value | ||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Loans held for sale | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Loans held for investment, net | ||||||||||||||||||||||||||||||||
Other assets | ||||||||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Convertible senior notes, net (1) | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Notes issued by securitization trusts | ||||||||||||||||||||||||||||||||
Funding debt (2) | ||||||||||||||||||||||||||||||||
Total liabilities | $ | $ | $ | $ | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
Available outstanding under stock option plan | ||||||||||||||
Available for future grant under stock option plan | ||||||||||||||
Total |
Number of Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in thousands) | |||||||||||||||||||||||
Balance as of June 30, 2022 | $ | |||||||||||||||||||||||||
Granted | ||||||||||||||||||||||||||
Exercised | ( | |||||||||||||||||||||||||
Forfeited, expired or cancelled | ( | |||||||||||||||||||||||||
Balance as of December 31, 2022 | ||||||||||||||||||||||||||
Vested and exercisable, December 31, 2022 | $ | $ | ||||||||||||||||||||||||
Vested and exercisable, and expected to vest thereafter(1) December 31, 2022 | $ | $ |
Number of Shares | Weighted Average Grant Date Fair Value | |||||||||||||
Non-vested as of June 30, 2022 | $ | |||||||||||||
Granted | ||||||||||||||
Vested | ( | |||||||||||||
Forfeited, expired or cancelled | ( | |||||||||||||
Non-vested as of December 31, 2022 | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
General and administrative | $ | $ | $ | $ | ||||||||||||||||||||||
Technology and data analytics | ||||||||||||||||||||||||||
Sales and marketing | ||||||||||||||||||||||||||
Processing and servicing | ||||||||||||||||||||||||||
Total stock-based compensation in operating expenses | ||||||||||||||||||||||||||
Capitalized into property, equipment and software, net | ||||||||||||||||||||||||||
Total stock-based compensation expense | $ | $ | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2022 | |||||||||||||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Net loss attributable to common stockholders - basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Denominator: | ||||||||||||||||||||||||||
Weighted average shares of common stock - basic | ||||||||||||||||||||||||||
Weighted average shares of common stock - diluted | ||||||||||||||||||||||||||
Net loss per share: | ||||||||||||||||||||||||||
Basic | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Diluted | $ | ( | $ | ( | $ | ( | $ | ( |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2021 | 2021 | |||||||||||||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||
Net loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Net loss attributable to common stockholders - basic and diluted | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Denominator: | ||||||||||||||||||||||||||
Weighted average shares of common stock - basic | ||||||||||||||||||||||||||
Weighted average shares of common stock - diluted | ||||||||||||||||||||||||||
Net loss per share: | ||||||||||||||||||||||||||
Basic | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Diluted | $ | ( | $ | ( | $ | ( | $ | ( |
As of December 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
Restricted stock units | ||||||||||||||
Stock options, including early exercise of options | ||||||||||||||
Common stock warrants | ||||||||||||||
Employee stock purchase plan shares | ||||||||||||||
Total |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
United States | $ | $ | $ | $ | ||||||||||||||||||||||
Canada | ||||||||||||||||||||||||||
Other | — | — | ||||||||||||||||||||||||
Total | $ | $ | $ | $ |
December 31, 2022 | June 30, 2022 | |||||||||||||
United States | $ | $ | ||||||||||||
Canada | ||||||||||||||
Other | $ | $ | ||||||||||||
Total | $ | $ |
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||||||||||||||||||||||||
2022 | 2021 | % Change | 2022 | 2021 | % Change | |||||||||||||||||||||||||||||||||
(in thousands, except per consumer data) | ||||||||||||||||||||||||||||||||||||||
Gross Merchandise Volume (GMV) | $ | 5,658,286 | $ | 4,457,574 | 27 | % | $ | 10,047,703 | $ | 7,170,513 | 40 | % |
December 31, 2022 | December 31, 2021 | % Change | ||||||||||||||||||
(in thousands, except per consumer data) | ||||||||||||||||||||
Active Consumers | 15,615 | 11,231 | 39 | % | ||||||||||||||||
Transactions per Active Consumer (x) | 3.5 | 2.5 | 38 | % |
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||||
2022 | 2021 | $ | % | 2022 | 2021 | $ | % | ||||||||||||||||||||||||||||||||||||||||
(in thousands, except percentages) | |||||||||||||||||||||||||||||||||||||||||||||||
Revenue | |||||||||||||||||||||||||||||||||||||||||||||||
Merchant network revenue | $ | 134,019 | $ | 127,087 | $ | 6,932 | 5 | % | $ | 247,168 | $ | 219,331 | $ | 27,837 | 13 | % | |||||||||||||||||||||||||||||||
Virtual card network revenue | 29,117 | 26,558 | 2,559 | 10 | % | 55,825 | 45,953 | 9,872 | 21 | % | |||||||||||||||||||||||||||||||||||||
Total network revenue | 163,136 | 153,645 | 9,491 | 6 | % | 302,993 | 265,284 | 37,709 | 14 | % | |||||||||||||||||||||||||||||||||||||
Interest income (1) | 155,321 | 138,355 | 16,966 | 12 | % | 292,123 | 255,657 | 36,466 | 14 | % | |||||||||||||||||||||||||||||||||||||
Gain on sales of loans (1) | 59,607 | 57,690 | 1,917 | 3 | % | 123,202 | 88,669 | 34,533 | 39 | % | |||||||||||||||||||||||||||||||||||||
Servicing income | 21,494 | 11,321 | 10,173 | 90 | % | 42,864 | 20,786 | 22,078 | 106 | % | |||||||||||||||||||||||||||||||||||||
Total Revenue, net | $ | 399,558 | $ | 361,011 | $ | 38,547 | 11 | % | $ | 761,182 | $ | 630,396 | $ | 130,786 | 21 | % | |||||||||||||||||||||||||||||||
Operating Expenses (2) | |||||||||||||||||||||||||||||||||||||||||||||||
Loss on loan purchase commitment | $ | 38,422 | $ | 65,265 | $ | (26,843) | (41) | % | $ | 74,032 | $ | 116,943 | $ | (42,911) | (37) | % | |||||||||||||||||||||||||||||||
Provision for credit losses | 106,689 | 52,640 | 54,049 | 103 | % | 170,939 | 116,287 | 54,652 | 47 | % | |||||||||||||||||||||||||||||||||||||
Funding costs | 43,751 | 17,700 | 26,051 | 147 | % | 68,817 | 34,453 | 34,364 | 100 | % | |||||||||||||||||||||||||||||||||||||
Processing and servicing | 66,508 | 41,849 | 24,659 | 59 | % | 120,867 | 67,050 | 53,817 | 80 | % | |||||||||||||||||||||||||||||||||||||
Technology and data analytics | 156,747 | 94,989 | 61,758 | 65 | % | 301,708 | 173,002 | 128,706 | 74 | % | |||||||||||||||||||||||||||||||||||||
Sales and marketing | 188,334 | 143,476 | 44,858 | 31 | % | 352,207 | 207,436 | 144,771 | 70 | % | |||||||||||||||||||||||||||||||||||||
General and administrative | 158,639 | 141,292 | 17,347 | 12 | % | 319,611 | 277,496 | 42,115 | 15 | % | |||||||||||||||||||||||||||||||||||||
Total Operating Expenses | 759,090 | 557,211 | 201,879 | 36 | % | 1,408,181 | 992,667 | 415,514 | 42 | % | |||||||||||||||||||||||||||||||||||||
Operating Loss | $ | (359,532) | $ | (196,200) | $ | (163,332) | 83 | % | $ | (646,999) | $ | (362,271) | $ | (284,728) | 79 | % | |||||||||||||||||||||||||||||||
Other income (expense), net | 35,527 | 36,741 | (1,214) | (3) | % | 71,545 | (103,632) | 175,177 | (169) | % | |||||||||||||||||||||||||||||||||||||
Loss Before Income Taxes | $ | (324,005) | $ | (159,459) | $ | (164,546) | 103 | % | $ | (575,454) | $ | (465,903) | $ | (109,551) | 24 | % | |||||||||||||||||||||||||||||||
Income tax (benefit) expense | (1,568) | 276 | (1,844) | (668) | % | (1,748) | 447 | (2,195) | (491) | % | |||||||||||||||||||||||||||||||||||||
Net Loss | $ | (322,437) | $ | (159,735) | $ | (162,702) | 102 | % | $ | (573,706) | $ | (466,350) | $ | (107,356) | 23 | % | |||||||||||||||||||||||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Balance at the beginning of the period | $ | 57,477 | $ | 53,657 | $ | 42,780 | $ | 53,177 | |||||||||||||||
Additions from loans purchased or originated, net of refunds | 72,650 | 121,603 | 143,044 | 198,873 | |||||||||||||||||||
Amortization of discount | (38,838) | (54,965) | (77,807) | (93,410) | |||||||||||||||||||
Unamortized discount released on loans sold | (13,779) | (72,335) | (28,953) | (110,680) | |||||||||||||||||||
Impact of foreign currency translation | 320 | — | (1,234) | — | |||||||||||||||||||
Balance at the end of the period | $ | 77,830 | $ | 47,960 | $ | 77,830 | $ | 47,960 |
Three Months Ended December 31, | Six Months Ended December 31, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
General and administrative | $ | 66,659 | $ | 61,947 | $ | 133,999 | $ | 129,689 | |||||||||||||||
Technology and data analytics | 48,534 | 21,427 | 91,962 | 41,494 | |||||||||||||||||||
Sales and marketing | 5,549 | 4,633 | 13,677 | 9,657 | |||||||||||||||||||
Processing and servicing | 1,033 | 530 | 1,945 | 886 | |||||||||||||||||||
Total stock-based compensation in operating expenses | 121,775 | 88,537 | 241,583 | 181,726 | |||||||||||||||||||
Capitalized into property, equipment and software, net | 22,443 | 13,383 | 43,647 | 25,073 | |||||||||||||||||||
Total stock-based compensation expense | $ | 144,218 | $ | 101,920 | $ | 285,230 | $ | 206,799 |
December 31, 2022 | June 30, 2022 | |||||||||||||
Cash and cash equivalents (1) | $ | 1,440,333 | $ | 1,255,171 | ||||||||||
Investments in short-term debt securities (2) | 697,998 | 1,295,811 | ||||||||||||
Investments in long-term debt securities (2) | 216,925 | 299,562 | ||||||||||||
Cash, cash equivalent and investments in debt securities | $ | 2,355,256 | $ | 2,850,544 |
Maturity Fiscal Year | Borrowing Capacity | Principal Outstanding | ||||||||||||
(in thousands) | ||||||||||||||
2023 | $ | 184,551 | $ | 177,864 | ||||||||||
2024 | 953,006 | 520,794 | ||||||||||||
2025 | 850,000 | 460,715 | ||||||||||||
2026 | 584,551 | 193,954 | ||||||||||||
2027 and thereafter | 850,000 | 541,125 | ||||||||||||
Total | $ | 3,422,108 | $ | 1,894,452 |
Six Months Ended December 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Net Cash Provided by (Used in) Operating Activities | 22,667 | (75,104) | ||||||||||||
Net Cash Used in Investing Activities | (574,938) | (819,573) | ||||||||||||
Net Cash Provided by Financing Activities(1) | 869,355 | 2,010,213 |
Six Months Ended December 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Proceeds from issuance of common stock, net of repurchases | 8,137 | 59,565 | ||||||||||||
Proceeds from issuance of convertible debt, net | — | 1,704,300 | ||||||||||||
Net cash provided by equity-related financing activities | $ | 8,137 | $ | 1,763,865 | ||||||||||
Net cash provided by debt-related financing activities | 906,538 | 359,128 | ||||||||||||
Payments of tax withholding for stock-based compensation | (45,320) | (112,780) | ||||||||||||
Net cash provided by financing activities | $ | 869,355 | $ | 2,010,213 |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||||||||
Exhibit Number | Description | Form | File No. | Exhibit | Filing Date | Filed Herewith | ||||||||||||||||||||||||||||||||||||||
10.1 | X | |||||||||||||||||||||||||||||||||||||||||||
10.2 | X | |||||||||||||||||||||||||||||||||||||||||||
10.3 | X | |||||||||||||||||||||||||||||||||||||||||||
31.1 | X | |||||||||||||||||||||||||||||||||||||||||||
31.2 | X | |||||||||||||||||||||||||||||||||||||||||||
32.1 | X | |||||||||||||||||||||||||||||||||||||||||||
32.2 | X | |||||||||||||||||||||||||||||||||||||||||||
101.INS | XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | X | ||||||||||||||||||||||||||||||||||||||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | X | ||||||||||||||||||||||||||||||||||||||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X | ||||||||||||||||||||||||||||||||||||||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | X | ||||||||||||||||||||||||||||||||||||||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | X | ||||||||||||||||||||||||||||||||||||||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | X | ||||||||||||||||||||||||||||||||||||||||||
104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) | X | ||||||||||||||||||||||||||||||||||||||||||
* | Portions of the exhibit have been omitted as the Company has determined that: (i) the omitted information is not material; and (ii) the omitted information would likely cause competitive harm to the Company if publicly disclosed. |
AFFIRM HOLDINGS, INC. | ||||||||
Date: February 8, 2023 | By: | /s/ Max Levchin | ||||||
Max Levchin | ||||||||
Chief Executive Officer | ||||||||
(Principal Executive Officer) | ||||||||
By: | /s/ Michael Linford | |||||||
Michael Linford | ||||||||
Chief Financial Officer | ||||||||
(Principal Financial Officer) |
Affirm, Inc. | Shopify Inc. | ||||
Signature: /s/ Scott Williams | Signature: /s/ Amy Shapero | ||||
Printed Name: Scott Williams | Printed Name: Amy Shapero | ||||
Title: VP of Strategic Partnerships | Title: Chief Financial Officer | ||||
Date: 10/28/22 | Date: 10/28/22 |
Shopify Inc. | Affirm, Inc. | ||||
Signature: /s/ Jeff Hoffmeister | Signature: /s/ Scott Williams | ||||
Name: Jeff Hoffmeister | Name: Scott Williams | ||||
Title: Chief Financial Officer | Title: VP Strategic Partnerships | ||||
Date: 12/16/2022 | Date: 12/19/2022 | ||||
Notices. Notices required under this Agreement shall be delivered pursuant to Section 23 (Notice), and addressed as set forth below: | |||||
If to Shopify: Shopify Inc. 150 O’Connor Street, Ground Floor Ottawa, ON K2P 2L8 Canada [***] | If to Affirm: Affirm, Inc. 650 California Street, 12th Floor San Francisco, CA 94108 Attention: Chief Legal Officer [***] |
Date: February 8, 2023 | /s/ Max Levchin | |||||||
Max Levchin | ||||||||
Chief Executive Officer | ||||||||
(Principal Executive Officer) |
Date: February 8, 2023 | /s/ Michael Linford | |||||||
Michael Linford | ||||||||
Chief Financial Officer | ||||||||
(Principal Financial Officer) |
Dated: February 8, 2023 | ||||||||
/s/ Max Levchin | ||||||||
Max Levchin | ||||||||
Chief Executive Officer | ||||||||
(Principal Executive Officer) |
Dated: February 8, 2023 | ||||||||
/s/ Michael Linford | ||||||||
Michael Linford | ||||||||
Chief Financial Officer | ||||||||
(Principal Financial Officer) |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Revenue | ||||
Revenue | $ 163,136 | $ 153,645 | $ 302,993 | $ 265,284 |
Interest income | 155,321 | 138,355 | 292,123 | 255,657 |
Gain on sales of loans | 59,607 | 57,690 | 123,202 | 88,669 |
Servicing income | 21,494 | 11,321 | 42,864 | 20,786 |
Total Revenue, net | 399,558 | 361,011 | 761,182 | 630,396 |
Operating Expenses | ||||
Loss on loan purchase commitment | 38,422 | 65,265 | 74,032 | 116,943 |
Provision for credit losses | 106,689 | 52,640 | 170,939 | 116,287 |
Funding costs | 43,751 | 17,700 | 68,817 | 34,453 |
Processing and servicing | 66,508 | 41,849 | 120,867 | 67,050 |
Technology and data analytics | 156,747 | 94,989 | 301,708 | 173,002 |
Sales and marketing | 188,334 | 143,476 | 352,207 | 207,436 |
General and administrative | 158,639 | 141,292 | 319,611 | 277,496 |
Total Operating Expenses | 759,090 | 557,211 | 1,408,181 | 992,667 |
Operating Loss | (359,532) | (196,200) | (646,999) | (362,271) |
Other income (expense), net | 35,527 | 36,741 | 71,545 | (103,632) |
Loss Before Income Taxes | (324,005) | (159,459) | (575,454) | (465,903) |
Income tax (benefit) expense | (1,568) | 276 | (1,748) | 447 |
Net Loss | (322,437) | (159,735) | (573,706) | (466,350) |
Other Comprehensive Loss | ||||
Foreign currency translation adjustments | 4,522 | 2,341 | (17,024) | (1,461) |
Unrealized loss on securities available for sale, net | 3,069 | (657) | (2,459) | (936) |
Net Other Comprehensive Loss | 7,591 | 1,684 | (19,483) | (2,397) |
Comprehensive Loss | $ (314,846) | $ (158,051) | $ (593,189) | $ (468,747) |
Net loss per share attributable to common stockholders for Class A and Class B | ||||
Basic (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) |
Diluted (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) |
Net loss per share: | ||||
Basic (in shares) | 293,683,331 | 281,533,888 | 292,306,300 | 273,588,094 |
Diluted (in shares) | 293,683,331 | 281,533,888 | 292,306,300 | 273,588,094 |
Merchant network revenue | ||||
Revenue | ||||
Revenue | $ 134,019 | $ 127,087 | $ 247,168 | $ 219,331 |
Virtual card network revenue | ||||
Revenue | ||||
Revenue | $ 29,117 | $ 26,558 | $ 55,825 | $ 45,953 |
Business Description |
6 Months Ended |
---|---|
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description | Business Description Affirm Holdings, Inc. (“Affirm,” the “Company,” “we,” “us,” or “our”), headquartered in San Francisco, California, provides consumers with a simpler, more transparent, and flexible alternative to traditional payment options. Our mission is to deliver honest financial products that improve lives. Through our next-generation commerce platform, agreements with originating banks, and capital markets partners, we enable consumers to confidently pay for a purchase over time, with terms ranging from to sixty months. When a consumer applies for a loan through our platform, the loan is underwritten using our proprietary risk model, and once approved, the consumer selects their preferred repayment option. Loans are directly originated or funded and issued by our originating bank partners. Merchants partner with us to transform the consumer shopping experience and to acquire and convert customers more effectively through our frictionless point-of-sale payment solutions. Consumers get the flexibility to buy now and make simple regular payments for their purchases and merchants see increased average order value, repeat purchase rates, and an overall more satisfied customer base. Unlike legacy payment options and our competitors’ product offerings, which charge deferred or compounding interest and unexpected costs, we disclose up-front to consumers exactly what they will owe — no hidden fees, no deferred interest, no penalties.
|
Summary of Significant Accounting Policies |
6 Months Ended |
---|---|
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying interim condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), disclosure requirements for interim financial information, and the requirements of Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the fiscal year ended June 30, 2022. The balance sheet as of June 30, 2022 has been derived from the audited financial statements at that date. Management believes these interim condensed consolidated financial statements reflect all adjustments, including those of a normal and recurring nature, which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. Our interim condensed financial statements have been prepared on a consolidated basis. Under this basis of presentation, our financial statements consolidate all wholly owned subsidiaries and variable interest entities (“VIEs”), in which we have a controlling financial interest. These include various business trust entities and limited partnerships established to enter into warehouse credit agreements with certain lenders for funding debt facilities and certain asset-backed securitization transactions. All intercompany accounts and transactions have been eliminated in consolidation. Our variable interest arises from contractual, ownership, or other monetary interests in the entity, which changes with fluctuations in the fair value of the entity’s net assets. We consolidate a VIE when we are deemed to be the primary beneficiary. We assess whether or not we are the primary beneficiary of a VIE on an ongoing basis. Use of Estimates The preparation of interim condensed consolidated financial statements in conformity with U.S. GAAP requires the use of estimates, judgments and assumptions that affect the reported amounts in the interim condensed consolidated financial statements and the accompanying notes. Material estimates that are particularly susceptible to significant change relate to determination of variable consideration for revenue, the allowance for credit losses, capitalized internal-use software development costs, valuation allowance for deferred tax assets, loss on loan purchase commitment, the fair value of servicing assets and liabilities, discount on directly originated loans, the fair value of assets acquired and any contingent consideration transferred in business combinations, the evaluation for impairment of intangible assets and goodwill, the fair value of available for sale debt securities including retained interests in our securitization trusts, the fair value of residual certificates issued by our securitization trusts held by third parties, and stock-based compensation, including the fair value of warrants issued to nonemployees. We base our estimates on market-based inputs, historical experience, current events, and other factors we believe to be reasonable under the circumstances. These estimates are subjective in nature and to the extent that there are differences between these estimates and actual results, our financial condition or operating results in future periods may be affected. These estimates are based on information available as of the date of the interim condensed consolidated financial statements; therefore, actual results could differ materially from those estimates. Significant Accounting Policies There were no material changes to our significant accounting policies as disclosed in Note 2. Summary of Significant Accounting Policies of our Annual Report on Form 10-K for the fiscal year ended June 30, 2022, which was filed with the SEC on August 29, 2022. Recently Adopted Accounting Standards Financial Instruments - Credit Losses In March 2022, the FASB issued ASU 2022-02, “Financial Instruments— Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosure” which addresses areas identified by the FASB as part of its post-implementation review of the current expected credit losses model or “CECL” previously issued in ASU 2016-13, “Financial Instruments — Credit Losses (Topic 326)”. The amendments in this ASU eliminate the accounting guidance for troubled debt restructurings by creditors while enhancing the disclosure requirements for loan refinancing and restructurings made with borrowers experiencing financial difficulty. In addition, the amendments require a public business entity to disclose current-period gross write-offs by year of origination for financing receivables and net investment in leases in the vintage disclosures. For entities that have adopted ASU 2016-13, ASU 2022-02 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted if an entity has adopted ASU 2016-13. Amendments in this ASU should be applied prospectively except for the transition method related to the accounting for troubled debt restructurings in which an entity has the option to apply a modified retrospective transition method resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. We early adopted the new standard effective July 1, 2022 on a prospective basis. The adoption of the guidance did not have a material impact on our interim condensed financial statements. Recent Accounting Pronouncements Not Yet Adopted Business Combinations In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”, which requires contract assets and contract liabilities, such as deferred revenue, acquired in a business combination to be recognized and measured in accordance with Topic 606 (Revenue from Contracts with Customers). ASU 2021-08 is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. The ASU is effective for fiscal years beginning after December 15, 2022 and should be applied prospectively to acquisitions occurring on or after the effective date. Early adoption is permitted, including for interim periods, and is applicable to all business combinations for which the acquisition date occurs within the beginning of the fiscal year of adoption. We are in the process of evaluating the impact of adopting this accounting standard update on our consolidated financial statements and disclosures. Reference Rate Reform In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. Subject to meeting certain criteria, the new guidance provides optional expedients and exceptions to applying contract modification accounting under existing U.S. GAAP, to address the expected phase out of the London Interbank Offered Rate (“LIBOR”). In January 2021, the FASB also issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope”, which provides additional optional expedients and exceptions applicable to all entities that have derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. In December 2022, the FASB issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848”, to extend the temporary accounting rules under Topic 848 from December 31, 2022 to December 31, 2024. These ASUs are effective for all entities upon their respective issuance dates through December 31, 2024. We have reviewed all our financial agreements that utilize LIBOR as the reference rate and determined there is no impact to our interim condensed consolidated financial statements as of December 31, 2022. Throughout the remaining effective period for ASU 2020-04, ASU 2021-01 and ASU 2022-06, we will continue to evaluate the available relief measures within each of these amendments and will determine any impact on our consolidated financial statements and disclosures, as applicable.
|
Revenue |
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Banking and Thrift, Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Revenue The following table presents the company’s revenue disaggregated by revenue source (in thousands):
Merchant Network Revenue Merchant partners (or integrated merchants) are generally charged a fee based on gross merchandise volume (GMV) processed through the Affirm platform. The fees vary depending on the individual arrangement between us and each merchant and on the terms of the product offering. The fee is recognized at the point in time the merchant successfully confirms the transaction, which is when the terms of the executed merchant agreement are fulfilled. We may originate certain loans via our wholly-owned subsidiaries, with zero or below market interest rates. In these instances, the par value of the loans originated is in excess of the fair market value of such loans, resulting in a loss, which we record as a reduction to merchant network revenue. In certain cases, the losses incurred on loans originated for a merchant may exceed the total network revenue earned on those loans. To the extent we do not expect to recover the losses in future periods, we record the excess loss amounts as a sales and marketing expense. A portion of merchant network revenue relates to affiliate network revenue, which is generated when a user makes a purchase on a merchant’s website after being directed from an advertisement on Affirm’s website or mobile application. We earn a fixed placement fee and/or commission as a percentage of the associated sale. Revenue is recognized at the point in time when the performance obligation has been fulfilled, which is when the sale occurs. For the three and six months ended December 31, 2022, there were no merchants that exceeded 10% of total revenue. For the three and six months ended December 31, 2021, approximately 11% and 10% of total revenue, respectively, was driven by one merchant. Virtual Card Network Revenue We have agreements with issuer processors to facilitate transactions through the issuance of virtual debit cards to be used by consumers at checkout. Consumers can apply for a virtual debit card through the Affirm app and, upon approval, receive a single-use virtual debit card to be used for their purchase online or offline at a non-integrated merchant. The virtual debit card is funded at the time a transaction is authorized using cash held by the issuer processor in a reserve fund. Our originating bank partner then originates a loan to the consumer once the transaction is confirmed by the merchant. The non-integrated merchants are charged interchange fees by the issuer processor for virtual debit card transactions, and the issuer processor shares a portion of this revenue with us. We also leverage this issuer processor as a means of integrating certain merchants. Similarly, for these arrangements with integrated merchants, the merchant is charged interchange fees by the issuer processor and the issuer processor shares a portion of this revenue with us. Interest Income Interest income consisted of the following components (in thousands):
We accrue interest income using the effective interest method. Interest income on a loan is accrued daily, based on the finance charge disclosed to the consumer, over the term of the loan based upon the principal outstanding. The accrual of interest on a loan is suspended if a formal dispute with the consumer involving either Affirm or the merchant of record is opened, or a loan is 120 days past due. Upon the resolution of a dispute with the consumer, the accrual of interest is resumed, and any interest that would have been earned during the disputed period is retroactively accrued. As of December 31, 2022 and June 30, 2022, the balance of loans held for investment on non-accrual status was $1.8 million and $1.7 million, respectively. Gain on Sales of Loans We sell certain loans we originate or purchase from our originating bank partners directly to third-party investors or to securitizations. We recognize a gain or loss on sale of loans sold to third parties or to unconsolidated securitizations as the difference between the proceeds received and the carrying value of the loan, adjusted for the initial recognition of any assets or liabilities incurred upon sale, which generally include a net servicing asset or liability in connection with our ongoing obligation to continue to service the loans and a recourse liability based on our estimate of future losses in connection with our obligation to repurchase loans that do not meet certain contractual requirements and such information about the loan was unknown at the time of sale. Servicing Income Servicing income includes contractual fees specified in our servicing agreements with third-party loan owners and unconsolidated securitizations that are earned from providing professional services to manage loan portfolios on their behalf. Servicing income also includes fair value adjustments for servicing assets and servicing liabilities.
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Loans Held for Investment and Allowance for Credit Losses |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Held for Investment and Allowance for Credit Losses | Loans Held for Investment and Allowance for Credit Losses Loans held for investment consisted of the following (in thousands):
Loans held for investment includes loans originated through our originating bank partners and directly originated loans. The majority of the loans that are underwritten using our technology platform and originated by our originating bank partners are later purchased by us. We purchased loans from our originating bank partners in the amount of $4.4 billion and $7.9 billion during the three and six months ended December 31, 2022, respectively, and $3.4 billion and $5.6 billion during the three and six months ended December 31, 2021, respectively. These loans have a variety of lending terms as well as maturities ranging from to sixty months. Given that our loan portfolio focuses on one product segment, point-of-sale unsecured installment loans, we generally evaluate the entire portfolio as a single homogeneous loan portfolio and make merchant or program specific adjustments as necessary. We closely monitor credit quality for our loan receivables to manage and evaluate our related exposure to credit risk. Credit risk management begins with initial underwriting, where loan applications are assessed against the credit underwriting policy and procedures for our directly originated loans and originating bank partner loans, and continues through to full repayment of a loan. To assess a consumer who requests a loan, we use, among other indicators, internally developed risk models using detailed information from external sources, such as credit bureaus where available, and internal historical experience, including the consumer’s prior repayment history on our platform as well as other measures. We combine these factors to establish a proprietary score as a credit quality indicator. Our proprietary score (“ITACs”) is assigned to most loans facilitated through our technology platform, ranging from zero to 100, with 100 representing the highest credit quality and therefore the lowest likelihood of loss. The ITACs model analyzes the characteristics of a consumer’s attributes that are shown to be predictive of both willingness and ability to repay including, but not limited to: basic features of a consumer’s credit profile, a consumer’s prior repayment performance with other creditors, current credit utilization, and legal and policy changes. When a consumer passes both fraud and credit policy checks, the application is assigned an ITACs score. ITACs is also used for portfolio performance monitoring. Our credit risk team closely tracks the distribution of ITACs at the portfolio level, as well as ITACs at the individual loan level to monitor for signs of a changing credit profile within the portfolio. Repayment performance within each ITACs band is also monitored to support both the integrity of the risk scoring models and to measure possible changes in consumer behavior amongst various credit tiers. The following table presents an analysis of the credit quality, by ITACS score, of the amortized cost basis excluding accrued interest receivable, by fiscal year of origination on loans held for investment and loans held for sale (in thousands) as of December 31, 2022 and June 30, 2022:
(1)This balance represents loan receivables in new markets without sufficient data currently available for use by the Affirm scoring methodology including loan receivables originated in Canada and Australia.
Loan receivables are defined as past due if either the principal or interest have not been received within calendars days of when they are due in accordance with the agreed upon contractual terms. The following table presents an aging analysis of the amortized cost basis excluding accrued interest receivable of loans held for investment and loans held for sale by delinquency status (in thousands):
(1)Includes $27.8 million and $22.7 million of loan receivables as of December 31, 2022 and June 30, 2022, respectively, that are 90 days or more past due, but are not on nonaccrual status. We maintain an allowance for credit losses at a level sufficient to absorb expected credit losses based on evaluating known and inherent risks in our loan portfolio. The allowance for credit losses is determined based on our current estimate of expected credit losses over the remaining contractual term, historical credit losses, consumer payment trends, estimates of recoveries, and future expectations as of each balance sheet date. Adjustments to the allowance each period for changes in our estimate of lifetime expected credit losses are recognized in earnings through the provision for credit losses presented on our interim condensed consolidated statements of operations and comprehensive loss. When available information confirms that specific loans or portions thereof are uncollectible, identified amounts are charged against the allowance for credit losses. Loans are charged-off in accordance with our charge-off policy, as the contractual principal becomes 120 days past due. Subsequent recoveries of the unpaid principal balance, if any, are credited to the allowance for credit losses. The following table details activity in the allowance for credit losses, including charge-offs, recoveries and provision for loan losses (in thousands):
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Acquisitions |
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Acquisitions | Acquisitions There were no acquisitions accounted for as business combinations completed in the three and six months ended December 31, 2022. During the three and six months ended December 31, 2021, we completed one acquisition accounted for as business combinations, discussed further below. Acquisitions completed during the three and six months ended December 31, 2021 ShopBrain On July 1, 2021, Affirm completed the acquisition of technology and intellectual property from Yroo, Inc. and entered into employment arrangements with certain of its employees (“the ShopBrain acquisition”). Yroo, Inc. is a data aggregation and cataloging technology company based in Canada (“ShopBrain”). The purchase price was comprised of (i) $30.0 million in cash and (ii) 151,745 shares of our Class A common stock issued to the shareholders of ShopBrain at closing. The acquisition date fair value of the consideration transferred was approximately $40.0 million, which consisted of the following (in thousands):
The acquisition was accounted for as a business combination and reflects the application of acquisition accounting in accordance with ASC Topic 805, “Business Combinations” (“ASC 805”). The acquired identifiable intangible assets have been recorded at their estimated fair values with the excess purchase price assigned to goodwill. The goodwill was primarily attributed to future synergies from integration and the value of the assembled workforce. The goodwill is expected to be deductible for income tax purposes. The following table summarizes the allocation of the consideration paid of approximately $40.0 million to the fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands):
The fair values of the intangible assets were determined by applying the replacement cost method. The fair value measurements are based on significant unobservable inputs, including management estimates and assumptions, and thus represents Level 3 measurements. The transaction costs associated with the acquisition were approximately $0.1 million and $0.2 million for the three and six months ended December 31, 2021, respectively, which are included in general and administrative expense within the interim condensed consolidated statements of operations and comprehensive loss. Other acquisitions Fast On April 19, 2022, Affirm completed the closing of the transaction contemplated by a Release and Waiver Agreement entered into with Fast AF, Inc., (“Fast”) relating to the hiring of certain of its employees or service providers and an option to acquire certain of its assets. The purchase price was comprised of (i) $10.0 million in cash and (ii) forgiveness of a $15.0 million senior secured note issued to Fast in April 2022 prior to the closing. The acquisition was accounted for as an asset acquisition in accordance with ASC 805 since the assets acquired do not meet the definition of a business. The acquired identifiable intangible assets have been recorded at a total cost of $25.4 million, which includes approximately $0.4 million of transaction costs associated with the acquisition. The excess of the total cost of the assets over their total fair value was allocated between the assets on the basis of their relative fair values. The fair values of the intangible assets were determined by applying the replacement cost method. The fair value measurements are based on significant unobservable inputs, including management estimates and assumptions, and thus represent Level 3 measurements. The following table sets forth the identifiable intangible assets acquired and the cost allocated to each asset as of the date of acquisition (in thousands):
The assembled workforce intangible asset has an expected useful life of 1.5 years. The developed technology asset will be amortized over its expected useful life if the associated assets are purchased and entered into service.
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Balance Sheet Components |
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Balance Sheet Related Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Components | Balance Sheet Components Accounts Receivable, net Our accounts receivable consist primarily of amounts due from payment processors, merchant partners, affiliate network partners and servicing fees due from third-party loan owners. We evaluate accounts receivable to determine management’s current estimate of expected credit losses based on historical experience and future expectations and record an allowance for credit losses, as applicable. Our allowance for credit losses with respect to accounts receivable was $11.8 million and $13.9 million as of December 31, 2022 and June 30, 2022, respectively. Property, Equipment and Software, net Property, equipment and software, net consisted of the following (in thousands):
Depreciation and amortization expense on property, equipment and software was $15.6 million and $29.1 million for the three and six months ended December 31, 2022, respectively, and $6.5 million and $11.5 million for the three and six months ended December 31, 2021, respectively. Depreciation expense on leasehold improvements, furniture and equipment, and computer equipment is allocated between general and administrative, technology and data analytics, sales and marketing, and processing and servicing based on employee headcount in the interim condensed consolidated statements of operations and comprehensive loss. Amortization expense on internally developed software is included as a component of technology and data analytics in the interim condensed consolidated statements of operations and comprehensive loss. No impairment losses related to property, equipment and software were recorded during the three and six months ended December 31, 2022 and 2021. Goodwill and Intangible Assets The changes in the carrying amount of goodwill during the six months ended December 31, 2022 were as follows (in thousands):
No impairment losses related to goodwill were recorded during the three and six months ended December 31, 2022 and 2021. Intangible assets consisted of the following (in thousands):
(1)Excludes an intangible asset in the amount of $12.9 million which represents the right to purchase developed technology in connection with the Fast asset acquisition. Amortization of this asset will begin when the purchase of the developed technology assets is complete and are placed into service. Refer to Note 5. Acquisitions for more information. Amortization expense for intangible assets was $7.4 million and $14.8 million for the three and six months ended December 31, 2022, respectively, and $5.5 million and $11.0 million for the three and six months ended December 31, 2021, respectively. No impairment losses related to intangible assets were recorded during the three and six months ended December 31, 2022 and 2021. The expected future amortization expense of these intangible assets as of December 31, 2022 is as follows (in thousands):
Commercial Agreement Assets During the year ended June 30, 2022, we granted warrants in connection with our commercial agreements with certain subsidiaries of Amazon.com, Inc. (“Amazon”). The warrants were granted in exchange for certain performance provisions and the benefit of acquiring new users. We recognized an asset of $133.5 million associated with the portion of the warrants that were fully vested upon grant. The asset was valued based on the fair value of the warrants and represents the probable future economic benefit to be realized over the approximate 3.2 year term of the commercial agreement at the grant date. For the three and six months ended December 31, 2022, we recognized amortization expense of $10.5 million and $20.9 million, respectively, and $5.8 million for both the three and six months ended December 31, 2021 in our interim condensed consolidated statements of operations and comprehensive loss as a component of sales and marketing expense. Refer to Note 14. Stockholders’ Equity for further discussion of the warrants. During the year ended June 30, 2021, we recognized an asset in connection with a commercial agreement with Shopify Inc. (“Shopify”), in which we granted warrants in exchange for the opportunity to acquire new merchant partners. This asset represents the probable future economic benefit to be realized over the expected benefit period and is valued based on the fair value of the warrants on the grant date. We recognized an asset of $270.6 million associated with the fair value of the warrants, which were fully vested as of December 31, 2022. The expected benefit period of the asset was initially estimated to be four years, and the remaining useful life of the asset is reevaluated each reporting period. During fiscal year 2022, the remaining expected benefit period was extended by two years upon the execution of an amendment to the commercial agreement with Shopify which extended the term of the agreement. During the three and six months ended December 31, 2022, we recorded amortization expense related to the commercial agreement asset of $9.1 million and $18.1 million, respectively, and $17.0 million and $34.0 million for the three and six months ended December 31, 2021, respectively, in our interim condensed consolidated statements of operations and comprehensive loss as a component of sales and marketing expense. During the year ended June 30, 2021, we recognized an asset in connection with a commercial agreement with an enterprise partner, in which we granted stock appreciation rights in exchange for the benefit of acquiring access to the partner's consumers. This asset represents the probable future economic benefit to be realized over the three-year expected benefit period and is valued based on the fair value of the stock appreciation rights on the grant date. We initially recognized an asset of $25.9 million associated with the fair value of the stock appreciation rights. During the three and six months ended December 31, 2022, we recorded amortization expense related to the asset of $2.1 million and $4.2 million, respectively, and $2.1 million and $4.0 million for the three and six months ended December 31, 2021, respectively, in our interim condensed consolidated statements of operations and comprehensive loss as a component of sales and marketing expense. Other Assets Other assets consisted of the following (in thousands):
Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consisted of the following (in thousands)
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Leases |
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Leases | Leases We lease facilities under operating leases with various expiration dates through 2030. We have the option to renew or extend our leases. Certain lease agreements include the option to terminate the lease with prior written notice ranging from nine months to one year. As of December 31, 2022, we have not considered such provisions in the determination of the lease term, as it is not reasonably certain these options will be exercised. Leases have remaining terms that range from less than one year to eight years. Several leases require us to obtain standby letters of credit, naming the lessor as a beneficiary. These letters of credit act as security for the faithful performance by us of all terms, covenants and conditions of the lease agreement. The cash collateral and deposits for the letters of credit have been recognized as restricted cash in the interim condensed consolidated balance sheets and totaled $9.7 million as of both December 31, 2022 and June 30, 2022. There was no impairment expense incurred related to leases during the three and six months ended December 31, 2022 and 2021. The components of operating lease expenses are as follows (in thousands):
We have subleased a portion of our leased facilities. Sublease income totaled $0.9 million and $1.7 million during the three and six months ended December 31, 2022, respectively, and $0.9 million and $1.5 million during the three and six months ended December 31, 2021, respectively. Lease term and discount rate information are summarized as follows:
Maturities of lease liabilities as of December 31, 2022 are as follows (in thousands) for the years ended:
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Commitment and Contingencies |
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Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Repurchase Obligation Under the normal terms of our whole loans sales to third-party investors, we may become obligated to repurchase loans from investors in certain instances where a breach in representation and warranties is identified. Generally, a breach in representation and warranties would occur where a loan has been identified as subject to verified or suspected fraud, or in cases where a loan was serviced or originated in violation of Affirm’s guidelines. We would only experience a loss if the contractual repurchase price of the loan exceeds the fair value on the repurchase date. This amount was not material as of December 31, 2022. Legal Proceedings From time to time, we are subject to legal proceedings and claims in the ordinary course of business. The results of such matters often cannot be predicted with certainty. In accordance with applicable accounting guidance, we establish an accrued liability for legal proceedings and claims when those matters present loss contingencies which are both probable and reasonably estimable. Toole v. Affirm Holdings, Inc. On February 28, 2022, plaintiff Jeffrey Toole filed a putative class action against Affirm and Max Levchin in the U.S. District Court for the Northern District of California (the “Toole action”). The Toole action alleged that Affirm violated Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 promulgated thereunder by issuing and then subsequently deleting a tweet from its official Twitter account on February 10, 2022, which omitted full details of Affirm’s second quarter fiscal 2022 financial results. Plaintiff sought class certification, unspecified compensatory and punitive damages, and costs and expenses. On September 28, 2022, the Court granted Affirm’s motion to dismiss for failure to state a claim with leave to amend within 21 days. No amended complaint was filed by the deadline. On October 20, 2022, the Court dismissed the putative class action and entered judgment in Affirm’s favor. Vallieres v Levchin, et al. On April 25, 2022, plaintiff Michael Vallieres filed a shareholder derivative lawsuit in the U.S. District Court for the Northern District of California (the “Vallieres action”) against Affirm, as a nominal defendant, and certain of Affirm’s current officers and directors as defendants based on allegations substantially similar to those in the Toole action. The Vallieres complaint purported to assert claims on Affirm's behalf for breach of fiduciary duty, gross mismanagement, abuse of control, unjust enrichment, and contribution under the federal securities laws, and sought corporate reforms, unspecified damages and restitution, and fees and costs. On January 12, 2023, the Court dismissed the derivative action without prejudice. Williams v. Levchin, et al. On September 16, 2022, plaintiff Ron Williams filed a shareholder derivative lawsuit in the U.S. District Court for the Northern District of California (the “Williams action”) against Affirm, as a nominal defendant, and certain of Affirm’s current and former officers and directors as defendants based on allegations substantially similar to those in the Toole action and Vallieres action. The Williams complaint purported to assert six causes of action on Affirm's behalf—violation of Section 14(a) of the Exchange Act, breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets. The plaintiff in the Williams action also alleged a cause of action against defendant Levchin for contribution under 10(b) and 21D of the Exchange Act. The Williams complaint sought corporate reforms, unspecified damages and restitution, and fees and costs. On December 22, 2022, the Court dismissed the derivative action without prejudice. Kusnier v. Affirm Holdings, Inc. On December 8, 2022, plaintiff Mark Kusnier filed a putative class action lawsuit against Affirm, Max Levchin, and Michael Linford in the U.S. District Court for the Northern District of California (the “Kusnier action”). The Kusnier action alleges that Defendants caused Affirm to make materially false and/or misleading statements and/or failed to disclose that (i) Affirm’s BNPL service facilitated excessive consumer debt, regulatory arbitrage, and data harvesting; which (ii) subjected Affirm to a heightened risk of regulatory scrutiny and enforcement action; and (iii) as a result, Affirm’s public statements were materially false and misleading. In light of the above, Plaintiff asserts that Affirm violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and that Levchin and Linford violated Section 20(a) of the Exchange Act. Plaintiff seeks class certification, unspecified compensatory and punitive damages, and costs and expenses. We have determined, based on current knowledge, that the aggregate amount or range of losses that are estimable with respect to our legal proceedings, including the matters described above, would not have a material adverse effect on our consolidated financial position, results of operations or cash flows. Amounts accrued as of December 31, 2022 were not material. The ultimate outcome of legal proceedings involves judgments, estimates and inherent uncertainties, and cannot be predicted with certainty.
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Transactions with Related Parties |
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Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | Transactions with Related Parties In the ordinary course of business, we may enter into transactions with directors, principal officers, their immediate families and affiliated companies in which they are principal stockholders (commonly referred to as related parties). Some of our directors, principal officers, and their immediate families have received loans facilitated by us, in accordance with our regular consumer loan offerings. As of December 31, 2022, the outstanding balance and interest earned on such accounts is immaterial. |
Debt |
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Debt | Debt Debt encompasses funding debt, convertible senior notes and our revolving credit facility. Funding Debt Funding debt and its aggregate future maturities consists of the following (in thousands):
Warehouse Credit Facilities Through subsidiaries, we entered into warehouse credit facilities with certain lenders to finance the purchase and origination of our loans.Borrowings under these agreements are referred to as funding debt and proceeds from the borrowings can only be used for the purposes of facilitating loan funding and origination, with advance rates ranging from 82% to 87% of the total collateralized balance. These revolving facilities mature between fiscal years 2023 and 2029, and subject to covenant compliance, generally permit borrowings up to 12 months prior to the final maturity date of each respective facility. As of December 31, 2022, the aggregate commitment amount of these facilities was $3.4 billion on a revolving basis, of which $1.9 billion was drawn, with $1.6 billion remaining available. Some of the loans originated by us or purchased from the originating bank partners are pledged as collateral for borrowings in our facilities. The unpaid principal balance of these loans totaled $2.1 billion and $549.6 million as of December 31, 2022 and June 30, 2022, respectively. Our U.S, based warehouse credit facilities and certain lending facilities funding the origination of loans outside of the U.S., have been classified as VIEs and are bankruptcy-remote special-purpose vehicles in which creditors do not have recourse against the general credit of Affirm. Funding debt, net of deferred issuance costs, within out VIEs represents $1.9 billion and $672.6 million, as of December 31, 2022 and June 30, 2022, respectively. We accrue monthly interest expense on each warehouse based on the contractual terms set forth in the applicable credit agreement. Interest expense also includes capitalized transaction fees which are amortized on a straight-line basis over the term of the warehouse agreement. The contractual interest rate varies across each warehouse facility and is either based on a benchmark interest rate (such as LIBOR, SOFR, Canadian Prime Rate, CDOR, or the Government of Canada Central Bank Rate), or an alternative commercial paper rate (which is the per annum rate equivalent to the weighted-average of the per annum rates at which all commercial paper notes were issued by certain lenders to fund advances or maintain loans), plus a spread ranging from 1.25% to 4.25%. In addition, these agreements require payment of a monthly unused commitment fee ranging from 0.00% to 0.75% per annum on the undrawn portion available. These agreements contain certain customary negative covenants and financial covenants including maintaining certain levels of minimum liquidity, maximum leverage, and minimum tangible net worth. As of December 31, 2022, we were in compliance with all applicable covenants in the agreements. Repurchase Agreements We entered into certain sale and repurchase agreements pursuant to our retained interests in our off-balance sheet securitizations where we have sold these securities to a counterparty with an obligation to repurchase at a future date and price. The repurchase agreements each have an initial term of three months and subject to mutual agreement by Affirm and the counterparty, we may enter into a repurchase date extension for an additional three month term at market interest rates on such extension date. As of December 31, 2022, the interest rates were 4.06% on the senior pledged securities and 5.71% on the residual certificate pledged securities. We had $25.2 million and $27.0 million in debt outstanding under our repurchase agreements disclosed within funding debt on the interim condensed consolidated balance sheets as of December 31, 2022 and June 30, 2022, respectively. The debt will be amortized through regular principal and interest payments on the pledged securities. The outstanding debt relates to $32.8 million and $32.4 million in pledged securities disclosed within securities available for sale at fair value on the interim condensed consolidated balance sheets as of December 31, 2022 and June 30, 2022, respectively. Convertible Senior Notes On November 23, 2021, we issued $1,725 million in aggregate principal amount of 0% convertible senior notes due 2026 (the “2026 Notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The total net proceeds from this offering, after deducting debt issuance costs, were approximately $1,704 million. The 2026 Notes represent senior unsecured obligations of the Company. The 2026 Notes do not bear interest except in special circumstances described below, and the principal amount of the 2026 Notes does not accrete. The 2026 Notes mature on November 15, 2026. Each $1,000 of principal of the 2026 Notes will initially be convertible into 4.6371 shares of our common stock, which is equivalent to an initial conversion price of approximately $215.65 per share, subject to adjustment upon the occurrence of certain specified events set forth in the indenture governing the 2026 Notes (the “Indenture”). Holders of the 2026 Notes may convert their 2026 Notes at their option at any time on or after August 15, 2026 until close of business on the second scheduled trading day immediately preceding the maturity date of November 15, 2026. Further, holders of the 2026 Notes may convert all or any portion of their 2026 Notes at their option prior to the close of business on the business day immediately preceding August 15, 2026, only under the following circumstances: 1) during any calendar quarter commencing after March 31, 2022 (and only during such calendar quarter), if the last reported sale price of the Class A common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; 2) during the five business day period after any five consecutive trading day period (the measurement period) in which the trading price (as defined in the indenture governing the 2026 Notes) per $1,000 principal amount of the 2026 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s Class A common stock and the conversion rate on each such trading day; 3) if the Company calls any or all of the notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or 4) upon the occurrence of certain specified corporate events. Upon conversion of the 2026 Notes, the Company will pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at the Company’s election. If we satisfy our conversion obligation solely in cash or through payment and delivery, as the case may be, of a combination of cash and shares of our common stock, the amount of cash and shares of common stock, if any, due upon conversion will be based on a daily conversion value (as set forth in the Indenture) calculated on a proportionate basis for each trading day in a 40 trading day observation period. No sinking fund is provided for the 2026 Notes. We may not redeem the notes prior to November 20, 2024. We may redeem for cash all or part of the notes on or after November 20, 2024 if the last reported sale price of our Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid special interest, if any. If a fundamental change (as defined in the Indenture) occurs prior to the maturity date, holders of the 2026 Notes may require us to repurchase all or a portion of their notes for cash at a repurchase price equal to 100% of the principal amount of the 2026 Notes, plus any accrued and unpaid interest to, but excluding, the repurchase date. In addition, if specific corporate events occur prior to the maturity date of the 2026 Notes, we will be required to increase the conversion rate for holders who elect to convert their 2026 Notes in connection with such corporate events. The convertible senior notes outstanding as of December 31, 2022 consisted of the following (in thousands):
The 2026 Notes do not bear interest. During the three and six months ended December 31, 2022, we recognized $1.1 million and $2.1 million, respectively, of interest expense related to the amortization of debt discount and issuance costs in the interim condensed consolidated statement of operations and comprehensive loss within . As of December 31, 2022, the remaining life of the 2026 Notes is approximately 47 months. Revolving Credit Facility On February 4, 2022, we entered into a revolving credit agreement with a syndicate of commercial banks for a $165.0 million unsecured revolving credit facility. On May 16, 2022, we increased unsecured revolving commitments under the facility to $205.0 million. This facility bears interest at a rate equal to, at our option, either (a) a Secured Overnight Financing Rate (“SOFR”) rate determined by reference to the forward-looking term SOFR rate for the interest period, plus an applicable margin of 1.85% per annum or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum, (ii) the rate last quoted by the Wall Street Journal as the U.S. prime rate and (iii) the one-month forward-looking term SOFR rate plus 1.0% per annum, in each case, plus an applicable margin of 0.85% per annum. The revolving credit agreement has a final maturity date of February 4, 2025. The facility contains certain covenants and restrictions, including certain financial maintenance covenants, and requires payment of a monthly unused commitment fee of 0.20% per annum on the undrawn balance available. There are no borrowings outstanding under the facility as of December 31, 2022.
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Securitization and Variable Interest Entities |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securitization and Variable Interest Entities | Securitization and Variable Interest Entities Consolidated VIEs Warehouse Credit Facilities We established certain entities, deemed to be VIEs, to enter into warehouse credit facilities for the purpose of purchasing loans from our originating bank partners and funding directly originated loans. Refer to Note 10. Debt for additional information. The creditors of the VIEs have no recourse to the general credit of Affirm and the liabilities of the VIEs can only be settled by the respective VIEs’ assets; however, as the servicer of the loans pledged to our warehouse funding facilities, we have the power to direct the activities that most significantly impact the VIEs' economic performance. In addition, we retain significant economic exposure to the pledged loans and therefore, we are the primary beneficiary. Securitizations In connection with our asset-backed securitization program, we sponsor and establish trusts (deemed to be VIEs) to ultimately purchase loans facilitated by our platform. Securities issued from our asset-backed securitizations are senior or subordinated, based on the waterfall criteria of loan payments to each security class. The subordinated residual interests issued from these transactions are first to absorb credit losses in accordance with the waterfall criteria. For these VIEs, the creditors have no recourse to the general credit of Affirm and the liabilities of the VIEs can only be settled by the respective VIEs’ assets. Additionally, the assets of the VIEs can be used only to settle obligations of the VIEs. We consolidate securitization VIEs when we are deemed to be the primary beneficiary and therefore have the power to direct the activities that most significantly affect the VIEs’ economic performance and a variable interest that could potentially be significant to the VIE. Through our role as the servicer, we have the power to direct the activities that most significantly affect the VIEs’ economic performance. In evaluating whether we have a variable interest that could potentially be significant to the VIE, we consider our retained interests. We also earn a servicing fee which has a senior distribution priority in the payment waterfall. In evaluating whether we are the primary beneficiary, management considers both qualitative and quantitative factors regarding the nature, size and form of our involvement with the VIEs. Management assesses whether we are the primary beneficiary of the VIEs on an ongoing basis. Where we consolidate the securitization trusts, the loans held in the securitization trusts are included in loans held for investment, and the notes sold to third-party investors are recorded in notes issued by securitization trusts in the interim condensed consolidated balance sheets. For each securitization, the residual certificates represent the right to receive excess cash on the loans each collection period after all fees and required distributions have been made to the note holders on the related payment date. For the majority of consolidated securitization VIEs, we retain 100% of the residual trust certificates issued by the securitization trust. Any portion of the residual trust certificates sold to third-party investors are measured at fair value, using a discounted cash flow model, and presented within accrued expenses and other liabilities on the interim condensed consolidated balance sheets. In addition to the retained residual certificates, our continued involvement includes loan servicing responsibilities over the life of the underlying loans. We defer and amortize debt issuance costs for consolidated securitization trusts on a straight-line basis over the expected life of the notes. The following tables present the aggregate carrying value of financial assets and liabilities within consolidated VIEs (in thousands):
Unconsolidated VIEs Our transactions with unconsolidated VIEs include securitization trusts where we did not retain significant economic exposure through our variable interests and therefore we determined that we are not the primary beneficiary as of December 31, 2022. The following information pertains to unconsolidated VIEs where we hold a variable interest but are not the primary beneficiary (in thousands):
Maximum exposure to losses represents our exposure through our continuing involvement as servicer and through our retained interests. For unconsolidated VIEs, this includes $32.8 million in retained notes and residual certificates disclosed within securities available for sale at fair value in our interim condensed consolidated balance sheets and $47.0 thousand related to our net servicing assets and liabilities disclosed within our interim condensed consolidated balance sheets as of December 31, 2022. Additionally, we may experience a loss due to future repurchase obligations resulting from breaches in representations and warranties in our securitization and third-party sale agreements. This amount was not material as of December 31, 2022. Retained Beneficial Interests in Unconsolidated VIEs The investors of the securitizations have no direct recourse to the assets of Affirm, and the timing and amount of beneficial interest payments is dependent on the performance of the underlying loan assets held within each trust. We have classified our retained beneficial interests in unconsolidated securitization trusts as “available for sale” and as such they are disclosed at fair value in our interim condensed consolidated balance sheets. See Note 12. Investments and Note 13. Fair Value of Financial Assets and Liabilities for additional information on the fair value sensitivity of the notes receivable and residual certificates. Additionally, as of December 31, 2022, we have pledged each of our retained beneficial interests as collateral in a sale and repurchase agreement as described in Note 10. Debt.
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Investments |
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Investments, All Other Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Investments Marketable Securities Marketable securities include certain investments classified as cash and cash equivalents and securities available for sale, at fair value, and consist of the following as of each date presented within the interim condensed consolidated balance sheets (in thousands):
(1)These securities have been pledged as collateral in connection with sale and repurchase agreements as discussed within Note 10. Debt. Securities Available for Sale, at Fair Value The amortized cost, gross unrealized gains and losses, allowance for credit losses, and fair value of securities available for sale as of December 31, 2022 and June 30, 2022 were as follows (in thousands):
(1)Certificates of deposit, corporate bonds, US government bonds, and commercial paper include $30.0 million and $303.8 million as of December 31, 2022 and June 30, 2022, respectively, classified as cash and cash equivalents within the interim condensed consolidated balance sheets. (2)These securities have been pledged as collateral in connection with sale and repurchase agreements as discussed within Note 10. Debt As of December 31, 2022 and June 30, 2022, there were no material reversals of prior period allowance for credit losses recognized for available for sale securities. A summary of securities available for sale with unrealized losses for which an allowance for credit losses has not been recorded, aggregated by investment category and the length of time that individual securities have been in a continuous loss position as of December 31, 2022 and June 30, 2022, are as follows (in thousands):
(1)The number of positions with unrealized losses for which an allowance for credit losses has not been recorded totaled 135 and 270 as of December 31, 2022 and June 30, 2022, respectively. The length of time to contractual maturities of securities available for sale as of December 31, 2022 and June 30, 2022 were as follows (in thousands):
(1)Based on weighted average life of expected cash flows as of December 31, 2022 and June 30, 2022. (2)Certificates of deposit, corporate bonds, US government bonds, and commercial paper include $30.0 million and $303.8 million as of December 31, 2022 and June 30, 2022, respectively, classified as cash and cash equivalents within the interim condensed consolidated balance sheets. Gross proceeds from matured or redeemed securities were $473.3 million and $2,154.4 million for the three and six months ended December 31, 2022, respectively, and $584.9 million and $635.6 million for the three and six months ended December 31, 2021, respectively. For available for sale securities realized gains and losses from portfolio sales were not material for the three and six months ended December 31, 2022. There were no portfolio sales or associated realized gains or losses for the three and six months ended December 31, 2021. Non-marketable Equity Securities Equity investments without a readily determinable fair value held at cost were $43.2 million as of both December 31, 2022 and June 30, 2022 and are included in other assets within the interim condensed consolidated balance sheets. There have been no unrealized or realized gains and losses due to observable changes in orderly transactions and we did not record any impairment for the three and six months ended December 31, 2022 and 2021.
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Fair Value of Financial Assets and Liabilities |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities ASC Topic 820, “Fair Value Measurement” (“ASC 820”) establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels: •Level 1: Inputs to the valuation methodology are quoted prices, unadjusted, for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and shall be used to measure fair value whenever available. •Level 2: Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; inputs to the valuation methodology include quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs to the valuation methodology that are derived principally from or can be corroborated by observable market data by correlation or other means. •Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement. Level 3 assets and liabilities include financial instruments whose value is determined using discounted cash flow methodologies, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Financial Assets and Liabilities Recorded at Fair Value The following tables present information about our assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2022 and June 30, 2022 (in thousands):
There were no transfers between levels during the periods ended December 31, 2022 and June 30, 2022. Assets and Liabilities Measured at Fair Value on a Recurring Basis (Level 2) Securities Available for Sale As of December 31, 2022, we held marketable securities classified as available for sale. Management obtains pricing from one or more third-party pricing services for the purpose of determining fair value. Whenever available, the fair value is based on quoted bid prices as of the end of the trading day. When quoted prices are not available, other methods may be utilized including evaluated prices provided by third-party pricing services. Derivative Instruments Our primary objective in holding derivatives is to reduce the volatility in cash flows associated with our funding activities, arising from changes in interest rates. We do not employ derivatives for trading or speculative purposes. As of December 31, 2022, we used a combination of interest rate cap agreements and interest rate swaps to manage interest costs and the risk associated with variable interest rates. Neither the interest rate caps or the interest rate swaps have been designated as hedging instruments. As of December 31, 2022 and June 30, 2022, the interest rate caps and interest rate swaps are in a net asset position, and classified as Level 2 within the fair value hierarchy, based on prices quoted for similar financial instruments in markets that are not active. The fair values are presented gross within other assets and offsetting collateral received by the counterparty is presented as a liability within accrued expenses and other liabilities on the interim condensed consolidated balance sheets. Any changes in the fair value of these financial instruments are reflected in , on the interim condensed consolidated statements of operations and comprehensive loss. Assets and Liabilities Measured at Fair Value on a Recurring Basis using Significant Unobservable Inputs (Level 3) We evaluate our financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level at which to classify them each reporting period. Since our servicing assets and liabilities, performance fee liability, securitization notes and residual trust certificates, contingent consideration, and profit share liability do not trade in an active market with readily observable prices, we use significant unobservable inputs to measure fair value. This determination requires significant judgments to be made. Servicing Assets and Liabilities We sold loans with an unpaid balance of $2.1 billion and $4.1 billion for the three and six months ended December 31, 2022, respectively, and $2.5 billion and $3.6 billion for the three and six months ended December 31, 2021, respectively, for which we retained servicing rights. As of December 31, 2022 and June 30, 2022, we serviced loans which we sold with a remaining unpaid principal balance of $4.6 billion and $4.5 billion, respectively. We use discounted cash flow models to arrive at an estimate of fair value. Significant assumptions used in the valuation of our servicing rights are as follows: Adequate Compensation We estimate adequate compensation as the rate a willing market participant would require for servicing loans with similar characteristics as those in the serviced portfolio. Discount Rate Estimated future payments to be received under servicing agreements are discounted as a part of determining the fair value of the servicing rights. For servicing rights on loans, the discount rate reflects the time value of money and a risk premium intended to reflect the amount of compensation market participants would require. Net Default Rate We estimate the timing and probability of early loan payoffs, loan defaults and write-offs, thus affecting the projected unpaid principal balance and expected term of the loan, which are used to project future servicing revenue and expenses. We earned $21.5 million and $42.9 million of servicing income for the three and six months ended December 31, 2022, respectively, and $11.3 million and $20.8 million for the three and six months ended December 31, 2021, respectively. As of December 31, 2022 and June 30, 2022, the aggregate fair value of the servicing assets was measured at $1.1 million and $1.2 million, respectively, and presented within other assets on the interim condensed consolidated balance sheets. As of December 31, 2022 and June 30, 2022, the aggregate fair value of the servicing liabilities was measured at $3.7 million and $2.7 million, respectively, and presented within accrued expenses and other liabilities on the interim condensed consolidated balance sheets. The following table summarizes the activity related to the aggregate fair value of our servicing assets (in thousands):
The following table summarizes the activity related to the aggregate fair value of our servicing liabilities (in thousands):
The following tables presents quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of servicing assets and liabilities as of December 31, 2022 and June 30, 2022:
(1)Estimated annual cost of servicing a loan as a percentage of unpaid principal balance (2)Annualized estimated gross charge-offs as a percentage of unpaid principal balance The following table summarizes the effect that adverse changes in estimates would have on the fair value of the servicing assets and liabilities given hypothetical changes in significant unobservable inputs (in thousands):
Performance Fee Liability In accordance with our agreements with our originating bank partners, we pay a fee for each loan that is fully repaid by the consumer, due at the end of the period in which the loan is fully repaid. We recognize a liability upon the purchase of a loan for the expected future payment of the performance fee. This liability is measured using a discounted cash flow model and recorded at fair value and presented within accrued expenses and other liabilities on the interim condensed consolidated balance sheets. Any changes in the fair value of the liability are reflected in , on the interim condensed consolidated statements of operations and comprehensive loss. The following table summarizes the activity related to the fair value of the performance fee liability (in thousands):
Significant unobservable inputs used for our Level 3 fair value measurement of the performance fee liability are the discount rate, refund rate, and default rate. Significant increases or decreases in any of the inputs in isolation could result in a significantly lower or higher fair value measurement. The following tables present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the performance fee liability as of December 31, 2022 and June 30, 2022:
Residual Trust Certificates Held by Third-Parties in Consolidated VIEs Residual trust certificates held by third-party investor(s) are measured at fair value, using a discounted cash flow model, and presented within accrued expenses and other liabilities on the interim condensed consolidated balance sheets. Any changes in the fair value of the liability are reflected in , on the interim condensed consolidated statements of operations and comprehensive loss. The following table summarizes the activity related to the fair value of the residual trust certificates held by third-parties (in thousands):
Significant unobservable inputs used for our Level 3 fair value measurement of the residual trust certificates held by third-parties are the discount rate, loss rate, and prepayment rate. Significant increases or decreases in any of the inputs in isolation could result in a significantly lower or higher fair value measurement. The following table present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the residual trust certificates held by third-parties as of December 31, 2022 and June 30, 2022:
Retained Beneficial Interests in Unconsolidated VIEs As of December 31, 2022, the Company held notes receivable and residual trust certificates with an aggregate fair value of $32.8 million in connection with unconsolidated securitizations. The balances correspond to the 5% economic risk retention the Company is required to maintain as the securitization sponsor. These assets are measured at fair value using a discounted cash flow model, and presented within securities available for sale at fair value on the interim condensed consolidated balance sheets. Changes in the fair value, other than declines in fair value due to credit recognized as an allowance, are reflected in other comprehensive income (loss) on the interim condensed consolidated statements of operations and comprehensive loss. Declines in fair value due to credit are reflected in on the interim condensed consolidated statements of operations and comprehensive loss. The following table summarizes the activity related to the fair value of the residual trust certificates (in thousands):
Significant unobservable inputs used for our Level 3 fair value measurement of the notes and residual trust certificates are the discount rate, loss rate, and prepayment rate. Significant increases or decreases in any of the inputs in isolation could result in a significantly lower or higher fair value measurement. The following tables present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the residual trust certificates as of December 31, 2022 and June 30, 2022:
The following table summarizes the effect that adverse changes in estimates would have on the fair value of the securitization residual trust certificates given hypothetical changes in significant unobservable inputs (in thousands):
Contingent Consideration Our acquisition of PayBright, Inc. (“PayBright”) on January 1, 2021 included consideration transferred and 2,587,362 shares of our common stock held in escrow, contingent upon the achievement of future milestones. At the acquisition date, we classified the contingent consideration as a liability and estimated its fair value using a Monte Carlo simulation utilizing assumptions of simulated revenue, equity volatility, and a discount rate. The liability is remeasured to its fair value at each reporting date, utilizing a Monte Carlo simulation for periods in which actual revenues are unknown, until the contingency is resolved. During the year ended June 30, 2022, one of these milestones was achieved and 1,293,681 shares of our Class A common stock were released from escrow, resulting in a reduction to the contingent liability. During the three and six months ended December 31, 2022, an additional milestone was achieved and the fair value was estimated based on the shares expected to be released from escrow multiplied by the estimated share price. The fair value estimate represents a Level 3 measurement, as the revenue milestone represents a significant unobservable input. The change in fair value of the contingent consideration at each reporting date is recognized as a component of in the interim condensed consolidated statements of operations and comprehensive loss for the respective period. The following table summarizes the activity related to the fair value of the PayBright contingent consideration (in thousands):
Profit Share Liability On January 1, 2021, we entered into a commercial agreement with an enterprise partner, in which we are obligated to share in the profitability of transactions facilitated by our platform. Upon capture of a loan under this program, we record a liability associated with the estimated future profit to be shared over the life of the loan based on estimated program profitability levels. This liability is measured using a discounted cash flow model and recorded at fair value and presented within accrued expenses and other liabilities on the interim condensed consolidated balance sheets. The following table summarizes the activity related to the fair value of the profit share liability (in thousands):
Significant unobservable inputs used for our Level 3 fair value measurement of the profit share liability are the discount rate and estimated program profitability. Significant increases or decreases in any of the inputs in isolation could result in a significantly lower or higher fair value measurement. The following tables present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the profit sharing liability as of December 31, 2022 and June 30, 2022:
Financial Assets and Liabilities Not Recorded at Fair Value The following tables present the fair value hierarchy for financial assets and liabilities not recorded at fair value as of December 31, 2022 and June 30, 2022 (in thousands):
(1)The estimated fair value of the convertible senior notes is determined based on a market approach, using the estimated or actual bids and offers of the notes in an over-the-counter market on the last business day of the period. (2)As of December 31, 2022 and June 30, 2022, debt issuance costs in the amount of $11.8 million and $10.8 million, respectively, was included within funding debt.
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Stockholders' Equity |
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Stockholders' Equity | Stockholders’ Equity Common Stock The Company had shares of common stock reserved for issuance as follows:
The common stock is not redeemable. We have two classes of common stock: Class A common stock and Class B common stock. Each holder of Class A common stock has the right to one vote per share of common stock. Each holder of Class B common stock has the right to 15 votes and can be converted at any time into one share of Class A common stock. Holders of Class A and Class B common stock are entitled to notice of any stockholders’ meeting in accordance with the bylaws of the corporation, and are entitled to vote upon such matters and in such manner as may be provided by law. Subject to the prior rights of holders of all classes of stock at the time outstanding having prior rights as to dividends, the holders of the common stock are entitled to receive, when and as declared by the Board of Directors, out of any assets of the corporation legally available therefore, such dividends as may be declared from time to time by the Board of Directors. Common Stock Warrants Common stock warrants are included as a component of additional paid in capital within the interim condensed consolidated balance sheets. In November 2021, we granted warrants to purchase 22,000,000 shares of common stock in connection with our commercial agreements with Amazon. 7,000,000 of the warrant shares have an exercise price of $0.01 per share and a term of 3.5 years, while the remaining 15,000,000 warrant shares have an exercise price of $100 per share and a term of 7.5 years. We valued the warrants at the grant date using the Black-Scholes-Merton option pricing model with the following assumptions: a dividend yield of zero; years to maturity of 3.5 and 7.5 years, respectively; volatility of 45%; and a risk-free rate of 0.93% and 1.47%, respectively. We recognized an asset of $133.5 million associated with the portion of the warrants that were fully vested at the grant date. Refer to Note 6. Balance Sheet Components for more information on the asset and related amortization during the period. The remaining grant-date fair value of the warrants will be recognized within our interim condensed consolidated statements of operations and comprehensive loss as a component of sales and marketing expense as the warrants vest, based upon Amazon’s satisfaction of the vesting conditions. During the three and six months ended December 31, 2022, a total of $138.6 million and $257.7 million, respectively, was recognized within sales and marketing expense which included $10.5 million and $20.9 million, respectively, in amortization expense of the commercial agreement asset and $128.1 million and $236.8 million, respectively, in expense based upon the grant-date fair value of the warrant shares that vested. During both the three and six months ended December 31, 2021, a total of $70.6 million was recognized within sales and marketing expense which included $5.8 million in amortization expense of the commercial agreement asset and $64.9 million in expense based upon the grant-date fair value of the warrant shares that vested.
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Incentive Plans | Equity Incentive Plans 2012 Stock Plan Under our Amended and Restated 2012 Stock Plan (the “Plan”), we may grant incentive and nonqualified stock options, restricted stock, and restricted stock units (“RSUs”) to employees, officers, directors, and consultants. As of December 31, 2022, the maximum number of shares of common stock which may be issued under the Plan is 146,209,197 Class A shares. As of December 31, 2022 and June 30, 2022, there were 39,443,744 and 31,156,746 shares of Class A common stock, respectively, available for future grants under the Plan. Stock Options For stock options granted before our IPO in January 2021, the minimum expiration period is seven years after termination of employment or 10 years from the date of grant. For stock options granted after our IPO, the minimum expiration period is three months after termination of employment or 10 years from the date of grant. Stock options generally vest over a period of four years or with 25% vesting on the 12 month anniversary of the vesting commencement date, and the remainder vesting on a pro-rata basis each month over the next three years. The following table summarizes our stock option activity for the six months ended December 31, 2022:
(1)Options expected to vest reflect the application of an estimated forfeiture rate. The weighted-average grant date fair value of options granted during the six months ended December 31, 2022 was $11.81. As of December 31, 2022, unrecognized compensation expense related to unvested stock options was approximately $58.0 million, which is expected to be recognized over a remaining weighted-average period of 2.2 years. When an employee exercises stock options, we collect and remit taxes on the employee’s behalf to applicable taxing authorities. As of December 31, 2022 and June 30, 2022, the balance of equity exercise taxes payable was $1.9 million and $10.9 million, respectively, which is included in accounts payable on the interim condensed consolidated balance sheets. Value Creation Award In November 2020, in connection with an overall review of the compensation of Max Levchin, our Chief Executive Officer, in advance of the IPO, and taking into account Mr. Levchin’s leadership since the inception of the Company, the comparatively modest level of cash compensation he had received from the Company during his many years of service, and that he did not hold any unvested equity awards, the Company’s Board of Directors approved a long-term, multi-year performance-based stock option grant providing Mr. Levchin with the opportunity to earn the right to purchase up to 12,500,000 shares of the Company’s Class A common stock (the “Value Creation Award”). We recognize stock-based compensation on these awards based on the grant date fair value using an accelerated attribution method over the requisite service period, and only if performance-based conditions are considered probable of being satisfied. During the three and six months ended December 31, 2022, we incurred stock-based compensation expense of $27.5 million and $55.0 million, respectively, associated with the Value Creation Award as a component of general and administrative expense within the interim condensed consolidated statements of operations and comprehensive loss. For the three and six months ended December 31, 2021, we incurred stock-based compensation expense of $42.3 million and $84.5 million, respectively. As of December 31, 2022, unrecognized compensation expense related to the Value Creation Award was approximately $152.5 million, which is expected to be recognized over a remaining weighted-average period of 3.0 years. Restricted Stock Units RSUs granted prior to the IPO were subject to two vesting conditions: a service-based vesting condition (i.e., employment over a period of time) and a performance-based vesting condition (i.e., a liquidity event in the form of either a change of control or an initial public offering, each as defined in the Plan), both of which must be met in order to vest. The performance-based condition was met upon the IPO. We record stock-based compensation expense for those RSUs on an accelerated attribution method over the requisite service period, which is generally four years. RSUs granted after IPO are subject to a service-based vesting condition. We record stock-based compensation expense for service-based RSUs on a straight-line basis over the requisite service period, which is generally to four years. The following table summarizes our RSU activity during the six months ended December 31, 2022:
As of December 31, 2022, unrecognized compensation expense related to unvested RSUs was approximately $675.8 million, which is expected to be recognized over a remaining weighted-average period of 2.0 years. 2020 Employee Stock Purchase Plan On November 18, 2020, our Board of Directors adopted and approved the 2020 Employee Stock Purchase Plan (“ESPP”). The purpose of the ESPP is to secure the services of new employees, to retain the services of existing employees and to provide incentives for such individuals to exert maximum effort towards the success of the Company and that of its affiliates. A total of 11.3 million shares of Class A common stock are reserved and available for issuance under the ESPP and 649,580 shares have been issued as of December 31, 2022. The ESPP provides for six-month offering periods beginning December 1 and June 1 of each year, with the initial six-month offering period beginning December 1, 2021. At the end of each offering period, shares of our Class A common stock are purchased on behalf of each ESPP participant at a price per share equal to 85% of the lesser of (1) the fair market value of the Class A common stock on first day of the offering period (the grant date) or (2) the fair market value of the Class A common stock on the last day of the offering period (the purchase date). We use the Black-Scholes-Merton option pricing model to measure the fair value of the purchase rights issued under the ESPP at the first day of the offering period, which represents the grant date. We record stock-based compensation expense on a straight-line basis over each six-month offering period, the requisite service period of the award. Stock-Based Compensation Expense The following table presents the components and classification of stock-based compensation (in thousands):
In connection with the acquisition of Returnly on May 1, 2021, we issued 304,364 shares of our Class A common stock, which are held in escrow. Because the future payment of the escrowed shares is contingent on continued employment of certain employees, the arrangement represents stock-based compensation in the post combination period. The grant-date fair value was estimated based on the value of the shares at the date of closing. The escrowed shares have a requisite service period of two years and contain a performance-based vesting condition (i.e., the achievement of certain revenue targets). We record stock-based compensation expense on a straight-line basis for each tranche over the requisite service period, as long as the performance-based conditions are considered probable of being satisfied. During the six months ended December 31, 2022, the arrangement was modified, resulting in the release of 45,459 shares from escrow and the remittance of 243,384 shares back to the Company. The modification resulted in the recognition of $2.0 million of incremental compensation cost within general and administrative expenses in our interim condensed statement of operations. As of December 31, 2022, 15,521 shares remain in escrow.
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Income Taxes |
6 Months Ended |
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Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The quarterly provision for income taxes is based on the current estimate of the annual effective income tax rate and the tax effect of discrete items occurring during the quarter. The Company’s quarterly provision and the estimate of the annual effective tax rate are subject to significant variation due to several factors, including variability in the pre-tax jurisdictional mix of earnings and the impact of discrete items. For the three and six months ended December 31, 2022, we recorded income tax expense (benefit) of $(1.6) million and $(1.7) million, respectively, which was primarily attributable to the effects of foreign income taxes on our Canadian subsidiary and partially offset by various U.S state and other foreign income taxes, as well as the tax amortization of certain intangibles. For the three and six months ended December 31, 2021, we recorded income tax expense (benefit) of $0.3 million and $0.4 million, respectively, which was primarily attributable to various U.S. state and foreign income taxes and the tax amortization of certain intangibles. As of December 31, 2022, we continue to recognize a full valuation allowance against our U.S. federal and state net deferred tax assets. This determination was based on the assessment of the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to utilize the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred by the Company for the prior three fiscal years. The presence of a three-year cumulative loss limits the ability to consider other subjective evidence, such as our expectations of future taxable income and projections for growth. As a result of the integration and consolidation of our PayBright business into and with Affirm’s Canadian business and the expansion of our overall business in Canada, as well as other objectively verifiable positive evidence, all of which we have concluded is sufficient to outweigh the existing negative evidence – including the presence of a three-year cumulative loss attributable to the related foreign jurisdiction, we have determined that it is more likely than not that our Canadian deferred tax assets will be realized and a valuation allowance is not required. On August 16, 2022, the Inflation Reduction Act was enacted into U.S. federal law. The Company does not currently expect that the Inflation Reduction Act will have a material impact on its income taxes.
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Net Loss per Share Attributable to Common Stockholders |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders The following table presents basic and diluted net loss per share attributable to common stockholders for Class A and Class B common stock (in thousands, except share and per share data):
The following common stock equivalents, presented based on amounts outstanding, were excluded from the calculation of diluted net loss per share attributable to common stockholders because their inclusion would have been anti-dilutive:
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Segments and Geographical Information |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments and Geographical Information | Segments and Geographical Information We conduct our operations through a single operating segment and, therefore, one reportable segment. Revenue Revenue by geography is based on the billing addresses of the borrower or the location of the merchant’s national headquarters. The following table sets forth revenue by geographic area (in thousands):
Long-Lived Assets The following table sets forth our long-lived assets, consisting of property, equipment and software, net and operating lease right-of-use assets, by geographic area (in thousands):
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Subsequent Events |
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Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The Company has evaluated the impact of events that have occurred subsequent to December 31, 2022, through the date of the interim condensed consolidated financial statements were filed with the SEC. There were no significant subsequent events identified other than the matters described below. Business Combination On February 1, 2023, we completed the closing of the transaction contemplated by a share purchase agreement entered into with certain sellers (as set forth therein) to acquire the entire issued share capital of Butter Holdings Ltd., a buy now, pay later company based in the United Kingdom. The purchase price was comprised of $14.9 million in cash, subject to adjustments in accordance with the purchase agreement, and $1.5 million settlement of subordinated secured notes. The initial accounting for the business combination is incomplete at the time of this filing due to the limited amount of time between the acquisition date and the date that these financial statements are issued. As a result, it is impracticable for us to provide all of the disclosures required for a business combination pursuant to ASC 805. Restructuring On February 8, 2023, we committed to a restructuring plan (the “Plan”) designed to manage our operating expenses in response to current macroeconomic conditions and ongoing business prioritization efforts. The Plan provides for a reduction of our workforce by approximately 500 employees, representing approximately 19% of our employees. In connection with the Plan, we are reevaluating our need for leased office space and have made the decision to fully vacate a portion of our San Francisco office. We expect implementation of the Plan to be substantially complete by the end of fiscal 2023. We expect to incur approximately $35 million to $39 million in total restructuring costs, which includes cash expenditures of $24 million to $28 million relating to one-time employee severance and other employment termination benefits and non-cash expenditures of approximately $11 million relating to the acceleration of amortization expense for the lease asset that we expect to incur in connection with the partial office closure. We expect to record the majority of the associated charges and the majority of the associated cash expenditures in the third fiscal quarter of 2023. The estimates of the costs and expenses that we expect to incur are subject to a number of assumptions and actual expenses may differ materially from the estimates disclosed above. We may also incur costs and expenses not currently contemplated due to unanticipated events that may occur with the implementation of the Plan.
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Summary of Significant Accounting Policies (Policies) |
6 Months Ended |
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Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the fiscal year ended June 30, 2022. The balance sheet as of June 30, 2022 has been derived from the audited financial statements at that date. Management believes these interim condensed consolidated financial statements reflect all adjustments, including those of a normal and recurring nature, which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. |
Principles of Consolidation | Our interim condensed financial statements have been prepared on a consolidated basis. Under this basis of presentation, our financial statements consolidate all wholly owned subsidiaries and variable interest entities (“VIEs”), in which we have a controlling financial interest. These include various business trust entities and limited partnerships established to enter into warehouse credit agreements with certain lenders for funding debt facilities and certain asset-backed securitization transactions. All intercompany accounts and transactions have been eliminated in consolidation. Our variable interest arises from contractual, ownership, or other monetary interests in the entity, which changes with fluctuations in the fair value of the entity’s net assets. We consolidate a VIE when we are deemed to be the primary beneficiary. We assess whether or not we are the primary beneficiary of a VIE on an ongoing basis.
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Use of Estimates | The preparation of interim condensed consolidated financial statements in conformity with U.S. GAAP requires the use of estimates, judgments and assumptions that affect the reported amounts in the interim condensed consolidated financial statements and the accompanying notes. Material estimates that are particularly susceptible to significant change relate to determination of variable consideration for revenue, the allowance for credit losses, capitalized internal-use software development costs, valuation allowance for deferred tax assets, loss on loan purchase commitment, the fair value of servicing assets and liabilities, discount on directly originated loans, the fair value of assets acquired and any contingent consideration transferred in business combinations, the evaluation for impairment of intangible assets and goodwill, the fair value of available for sale debt securities including retained interests in our securitization trusts, the fair value of residual certificates issued by our securitization trusts held by third parties, and stock-based compensation, including the fair value of warrants issued to nonemployees. We base our estimates on market-based inputs, historical experience, current events, and other factors we believe to be reasonable under the circumstances. These estimates are subjective in nature and to the extent that there are differences between these estimates and actual results, our financial condition or operating results in future periods may be affected.These estimates are based on information available as of the date of the interim condensed consolidated financial statements; therefore, actual results could differ materially from those estimates. |
Recently Adopted Accounting Standards and Recent Accounting Pronouncements Not Yet Adopted | Financial Instruments - Credit Losses In March 2022, the FASB issued ASU 2022-02, “Financial Instruments— Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosure” which addresses areas identified by the FASB as part of its post-implementation review of the current expected credit losses model or “CECL” previously issued in ASU 2016-13, “Financial Instruments — Credit Losses (Topic 326)”. The amendments in this ASU eliminate the accounting guidance for troubled debt restructurings by creditors while enhancing the disclosure requirements for loan refinancing and restructurings made with borrowers experiencing financial difficulty. In addition, the amendments require a public business entity to disclose current-period gross write-offs by year of origination for financing receivables and net investment in leases in the vintage disclosures. For entities that have adopted ASU 2016-13, ASU 2022-02 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted if an entity has adopted ASU 2016-13. Amendments in this ASU should be applied prospectively except for the transition method related to the accounting for troubled debt restructurings in which an entity has the option to apply a modified retrospective transition method resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. We early adopted the new standard effective July 1, 2022 on a prospective basis. The adoption of the guidance did not have a material impact on our interim condensed financial statements. Business Combinations In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”, which requires contract assets and contract liabilities, such as deferred revenue, acquired in a business combination to be recognized and measured in accordance with Topic 606 (Revenue from Contracts with Customers). ASU 2021-08 is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. The ASU is effective for fiscal years beginning after December 15, 2022 and should be applied prospectively to acquisitions occurring on or after the effective date. Early adoption is permitted, including for interim periods, and is applicable to all business combinations for which the acquisition date occurs within the beginning of the fiscal year of adoption. We are in the process of evaluating the impact of adopting this accounting standard update on our consolidated financial statements and disclosures. Reference Rate Reform In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. Subject to meeting certain criteria, the new guidance provides optional expedients and exceptions to applying contract modification accounting under existing U.S. GAAP, to address the expected phase out of the London Interbank Offered Rate (“LIBOR”). In January 2021, the FASB also issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope”, which provides additional optional expedients and exceptions applicable to all entities that have derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. In December 2022, the FASB issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848”, to extend the temporary accounting rules under Topic 848 from December 31, 2022 to December 31, 2024. These ASUs are effective for all entities upon their respective issuance dates through December 31, 2024. We have reviewed all our financial agreements that utilize LIBOR as the reference rate and determined there is no impact to our interim condensed consolidated financial statements as of December 31, 2022. Throughout the remaining effective period for ASU 2020-04, ASU 2021-01 and ASU 2022-06, we will continue to evaluate the available relief measures within each of these amendments and will determine any impact on our consolidated financial statements and disclosures, as applicable.
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Revenue (Tables) |
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Banking and Thrift, Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following table presents the company’s revenue disaggregated by revenue source (in thousands):
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Schedule of Interest Income | Interest income consisted of the following components (in thousands):
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Loans Held for Investment and Allowance for Credit Losses (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Held for Investment and Allowance for Credit Loss | Loans held for investment consisted of the following (in thousands):
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Schedule of Credit Quality by ITACs Score | The following table presents an analysis of the credit quality, by ITACS score, of the amortized cost basis excluding accrued interest receivable, by fiscal year of origination on loans held for investment and loans held for sale (in thousands) as of December 31, 2022 and June 30, 2022:
(1)This balance represents loan receivables in new markets without sufficient data currently available for use by the Affirm scoring methodology including loan receivables originated in Canada and Australia.
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Schedule of Delinquent Financing Receivables | The following table presents an aging analysis of the amortized cost basis excluding accrued interest receivable of loans held for investment and loans held for sale by delinquency status (in thousands):
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Schedule of Loans Held for Investment and Allowance for Credit Loss | The following table details activity in the allowance for credit losses, including charge-offs, recoveries and provision for loan losses (in thousands):
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Acquisitions (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Acquisition Consideration Transferred | The acquisition date fair value of the consideration transferred was approximately $40.0 million, which consisted of the following (in thousands):
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Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the allocation of the consideration paid of approximately $40.0 million to the fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):
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Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands):
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Schedule of Identifiable Intangible Assets Acquired | The following table sets forth the identifiable intangible assets acquired and the cost allocated to each asset as of the date of acquisition (in thousands):
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Balance Sheet Components (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Related Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property, Equipment and Software, Net | Property, equipment and software, net consisted of the following (in thousands):
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Schedule of Goodwill | The changes in the carrying amount of goodwill during the six months ended December 31, 2022 were as follows (in thousands):
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Schedule of Finite-Lived Intangible Assets | Intangible assets consisted of the following (in thousands):
(1)Excludes an intangible asset in the amount of $12.9 million which represents the right to purchase developed technology in connection with the Fast asset acquisition. Amortization of this asset will begin when the purchase of the developed technology assets is complete and are placed into service. Refer to Note 5. Acquisitions for more information.
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Schedule of Indefinite-Lived Intangible Assets | Intangible assets consisted of the following (in thousands):
(1)Excludes an intangible asset in the amount of $12.9 million which represents the right to purchase developed technology in connection with the Fast asset acquisition. Amortization of this asset will begin when the purchase of the developed technology assets is complete and are placed into service. Refer to Note 5. Acquisitions for more information.
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Schedule of Intangible Assets, Future Amortization Expense | The expected future amortization expense of these intangible assets as of December 31, 2022 is as follows (in thousands):
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Schedule of Other Assets | Other assets consisted of the following (in thousands):
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Schedule of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of the following (in thousands)
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Leases (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Lease Term and Discount Rate | The components of operating lease expenses are as follows (in thousands):
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Schedule of Maturities of Lease Liabilities | Maturities of lease liabilities as of December 31, 2022 are as follows (in thousands) for the years ended:
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Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Funding Debt and Aggregate Future Maturities | Funding debt and its aggregate future maturities consists of the following (in thousands):
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Schedule of Long-term Debt Instruments | The convertible senior notes outstanding as of December 31, 2022 consisted of the following (in thousands):
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Securitization and Variable Interest Entities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Aggregate Carrying Value of Financial Assets and Liabilities from VIEs | The following tables present the aggregate carrying value of financial assets and liabilities within consolidated VIEs (in thousands):
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Schedule of Variable Interest Entities | The following information pertains to unconsolidated VIEs where we hold a variable interest but are not the primary beneficiary (in thousands):
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Investments (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketable Securities | Marketable securities include certain investments classified as cash and cash equivalents and securities available for sale, at fair value, and consist of the following as of each date presented within the interim condensed consolidated balance sheets (in thousands):
(1)These securities have been pledged as collateral in connection with sale and repurchase agreements as discussed within Note 10. Debt.
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Unrealized Gain (Loss) on Investments | The amortized cost, gross unrealized gains and losses, allowance for credit losses, and fair value of securities available for sale as of December 31, 2022 and June 30, 2022 were as follows (in thousands):
(1)Certificates of deposit, corporate bonds, US government bonds, and commercial paper include $30.0 million and $303.8 million as of December 31, 2022 and June 30, 2022, respectively, classified as cash and cash equivalents within the interim condensed consolidated balance sheets. (2)These securities have been pledged as collateral in connection with sale and repurchase agreements as discussed within Note 10. Debt
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Schedule of Available-for-sale Securities with Unrealized Losses | A summary of securities available for sale with unrealized losses for which an allowance for credit losses has not been recorded, aggregated by investment category and the length of time that individual securities have been in a continuous loss position as of December 31, 2022 and June 30, 2022, are as follows (in thousands):
(1)The number of positions with unrealized losses for which an allowance for credit losses has not been recorded totaled 135 and 270 as of December 31, 2022 and June 30, 2022, respectively.
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Schedule of Length of Contractual Maturities of Securities Available for Sale | The length of time to contractual maturities of securities available for sale as of December 31, 2022 and June 30, 2022 were as follows (in thousands):
(1)Based on weighted average life of expected cash flows as of December 31, 2022 and June 30, 2022. (2)Certificates of deposit, corporate bonds, US government bonds, and commercial paper include $30.0 million and $303.8 million as of December 31, 2022 and June 30, 2022, respectively, classified as cash and cash equivalents within the interim condensed consolidated balance sheets.
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Fair Value of Financial Assets and Liabilities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Assets and Liabilities Fair Value Measured on Recurring Basis | The following tables present information about our assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2022 and June 30, 2022 (in thousands):
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Schedule of Servicing Assets at Fair Value | The following table summarizes the activity related to the aggregate fair value of our servicing assets (in thousands):
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Schedule of Servicing Liabilities at Fair Value | The following table summarizes the activity related to the aggregate fair value of our servicing liabilities (in thousands):
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Schedule of Significant Unobservable Inputs for Level 3 Fair Value Measurement | The following tables presents quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of servicing assets and liabilities as of December 31, 2022 and June 30, 2022:
(1)Estimated annual cost of servicing a loan as a percentage of unpaid principal balance (2)Annualized estimated gross charge-offs as a percentage of unpaid principal balance The following tables present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the performance fee liability as of December 31, 2022 and June 30, 2022:
The following table present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the residual trust certificates held by third-parties as of December 31, 2022 and June 30, 2022:
The following tables present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the residual trust certificates as of December 31, 2022 and June 30, 2022:
The following tables present quantitative information about the significant unobservable inputs used for our Level 3 fair value measurement of the profit sharing liability as of December 31, 2022 and June 30, 2022:
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Schedule of Sensitivity Analysis of Fair Value, Servicing Assets and Liabilities | The following table summarizes the effect that adverse changes in estimates would have on the fair value of the servicing assets and liabilities given hypothetical changes in significant unobservable inputs (in thousands):
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Summary of Activity for Liabilities With Significant Unobservable Inputs for Fair Value | The following table summarizes the activity related to the fair value of the performance fee liability (in thousands):
The following table summarizes the activity related to the fair value of the PayBright contingent consideration (in thousands):
The following table summarizes the activity related to the fair value of the profit share liability (in thousands):
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Schedule Sensitivity Analysis of Fair Value, Residual Trust Certificates | The following table summarizes the effect that adverse changes in estimates would have on the fair value of the securitization residual trust certificates given hypothetical changes in significant unobservable inputs (in thousands):
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Fair Value Hierarchy for Financial Assets and Liabilities Not Recorded at Fair Value | The following tables present the fair value hierarchy for financial assets and liabilities not recorded at fair value as of December 31, 2022 and June 30, 2022 (in thousands):
(1)The estimated fair value of the convertible senior notes is determined based on a market approach, using the estimated or actual bids and offers of the notes in an over-the-counter market on the last business day of the period. (2)As of December 31, 2022 and June 30, 2022, debt issuance costs in the amount of $11.8 million and $10.8 million, respectively, was included within funding debt.
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Stockholders' Equity (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Common Stock, Reserved for Future Issuance | The Company had shares of common stock reserved for issuance as follows:
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Equity Incentive Plans (Tables) |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Stock Option Activity | The following table summarizes our stock option activity for the six months ended December 31, 2022:
(1)Options expected to vest reflect the application of an estimated forfeiture rate.
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Schedule of Restricted Stock Unit Activity | The following table summarizes our RSU activity during the six months ended December 31, 2022:
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Schedule of Components and Classification of Stock-based Compensation | The following table presents the components and classification of stock-based compensation (in thousands):
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Net Loss per Share Attributable to Common Stockholders (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Basic and Diluted Net Loss Per Share | The following table presents basic and diluted net loss per share attributable to common stockholders for Class A and Class B common stock (in thousands, except share and per share data):
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Schedule of Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following common stock equivalents, presented based on amounts outstanding, were excluded from the calculation of diluted net loss per share attributable to common stockholders because their inclusion would have been anti-dilutive:
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Segments and Geographical Information (Tables) |
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Dec. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Revenue by Geographical Area | The following table sets forth revenue by geographic area (in thousands):
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Long-lived Assets by Geographic Areas | The following table sets forth our long-lived assets, consisting of property, equipment and software, net and operating lease right-of-use assets, by geographic area (in thousands):
|
Business Description (Details) |
6 Months Ended |
---|---|
Dec. 31, 2022 | |
Minimum | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |
Loan lending terms | 1 month |
Maximum | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |
Loan lending terms | 60 months |
Revenue - Disaggregated Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 163,136 | $ 153,645 | $ 302,993 | $ 265,284 |
Interest income | 155,321 | 138,355 | 292,123 | 255,657 |
Gain on sales of loans | 59,607 | 57,690 | 123,202 | 88,669 |
Servicing income | 21,494 | 11,321 | 42,864 | 20,786 |
Total Revenue, net | 399,558 | 361,011 | 761,182 | 630,396 |
Merchant network revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 134,019 | 127,087 | 247,168 | 219,331 |
Virtual card network revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 29,117 | $ 26,558 | $ 55,825 | $ 45,953 |
Revenue - Schedule of Interest Income (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Banking and Thrift, Interest [Abstract] | ||||
Interest income on unpaid principal balance | $ 125,858 | $ 88,674 | $ 231,996 | $ 171,615 |
Amortization of discount on loans | 38,838 | 54,965 | 77,807 | 93,410 |
Amortization of premiums on loans | (4,580) | (2,995) | (8,954) | (5,732) |
Interest receivable charged-off, net of recoveries | (4,795) | (2,289) | (8,726) | (3,636) |
Interest income | $ 155,321 | $ 138,355 | $ 292,123 | $ 255,657 |
Revenue - Additional Information (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Banking and Thrift, Interest [Abstract] | |||
Period of suspended accrued interest past due | 120 days | ||
Non-accrued loans held for investment | $ 1.7 | $ 1.8 | $ 1.7 |
Customer Concentration Risk | Largest merchant partner | Revenue | |||
Concentration Risk [Line Items] | |||
Revenue concentration percent | 11.00% | 10.00% |
Loans Held for Investment and Allowance for Credit Losses - Loans Held for Investment (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Receivables [Abstract] | ||
Unpaid principal balance | $ 3,691,398 | $ 2,516,733 |
Accrued interest receivable | 32,855 | 20,697 |
Premiums on loans held for investment | 9,081 | 8,911 |
Less: Discount due to loss on loan purchase commitment | (38,615) | (20,692) |
Less: Discount due to loss on directly originated loans | (38,381) | (20,443) |
Less: Fair value adjustment on loans acquired through business combination | (834) | (1,645) |
Loans held for investment | $ 3,655,504 | $ 2,503,561 |
Loans Held for Investment and Allowance for Credit Losses - Additional Information (Details) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
Dec. 31, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
|
Financing Receivable, Allowance for Credit Loss [Line Items] | ||||
Loans purchased | $ 4,400.0 | $ 3,400.0 | $ 7,900.0 | $ 5,600.0 |
Threshold period for delinquent loans past due | 4 days | 4 days | ||
Past due charge-off threshold | 120 days | 120 days | ||
Minimum | ||||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||||
Loan lending terms | 1 month | |||
Proprietary credit quality score | 0 | 0 | ||
Maximum | ||||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||||
Loan lending terms | 60 months | |||
Proprietary credit quality score | 100 | 100 |
Loans Held for Investment and Allowance for Credit Losses - Unpaid Principal Balance for Loans Held for Investment (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Financing Receivable, Past Due [Line Items] | ||
Non-delinquent loans | $ 3,655,504 | $ 2,503,561 |
Loans held for investment | 3,622,993 | 2,485,534 |
Loan receivable on nonaccrual status | 27,800 | 22,700 |
Non-delinquent loans | ||
Financing Receivable, Past Due [Line Items] | ||
Non-delinquent loans | 3,445,851 | 2,322,919 |
4 – 29 calendar days past due | ||
Financing Receivable, Past Due [Line Items] | ||
Non-delinquent loans | 79,930 | 77,963 |
30 – 59 calendar days past due | ||
Financing Receivable, Past Due [Line Items] | ||
Non-delinquent loans | 38,952 | 34,669 |
60 – 89 calendar days past due | ||
Financing Receivable, Past Due [Line Items] | ||
Non-delinquent loans | 29,261 | 26,919 |
90 – 119 calendar days past due | ||
Financing Receivable, Past Due [Line Items] | ||
Non-delinquent loans | $ 28,999 | $ 23,064 |
Loans Held for Investment and Allowance for Credit Losses - Allowance for Credit Loss (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance at beginning of period | $ 153,025 | $ 152,021 | $ 155,392 | $ 117,760 |
Provision for credit losses | 103,066 | 49,695 | 164,935 | 110,699 |
Charge-offs | (81,562) | (47,573) | (152,598) | (78,027) |
Recoveries of charged-off receivables | 7,571 | 4,146 | 14,371 | 7,857 |
Balance at end of period | $ 182,100 | $ 158,289 | $ 182,100 | $ 158,289 |
Acquisitions - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 19, 2022 |
Jul. 01, 2021 |
Dec. 31, 2021 |
Dec. 31, 2021 |
|
Fast AF, Inc | ||||
Business Acquisition [Line Items] | ||||
Cash paid for acquisition | $ 10,000 | |||
Cost of identifiable intangible assets | 25,415 | |||
Transaction costs | 400 | |||
Fast AF, Inc | Assembled workforce | ||||
Business Acquisition [Line Items] | ||||
Cost of identifiable intangible assets | $ 12,490 | |||
Useful Life (in years) | 1 year 6 months | |||
Fast AF, Inc | Senior Secured Note Issued To Fast AF, Inc | Senior Notes | ||||
Business Acquisition [Line Items] | ||||
Forgiveness of senior secured note | $ 15,000 | |||
ShopBrain | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 30,000 | |||
Purchase price | $ 40,000 | |||
Transaction costs | $ 100 | $ 200 | ||
ShopBrain | Class A common stock | ||||
Business Acquisition [Line Items] | ||||
Common stock issued (in shares) | 151,745 |
Acquisitions - Fair Value of Consideration Transferred (Details) - ShopBrain $ in Thousands |
Jul. 01, 2021
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Cash | $ 30,000 |
Fair value of Class A common stock transferred | 10,000 |
Total acquisition date fair value of the consideration transferred | $ 40,000 |
Acquisitions - Allocation of Consideration Paid to Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
Jul. 01, 2021 |
---|---|---|---|
Business Acquisition [Line Items] | |||
Goodwill | $ 527,630 | $ 539,534 | |
ShopBrain | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 9,488 | ||
Total assets acquired | 9,488 | ||
Goodwill | 30,512 | ||
Total purchase price | $ 40,000 |
Acquisitions - Identifiable Intangible Assets Acquired (Details) - USD ($) $ in Thousands |
Apr. 19, 2022 |
Jul. 01, 2021 |
---|---|---|
Fast AF, Inc | ||
Business Acquisition [Line Items] | ||
Fair Value | $ 25,415 | |
Developed technology | Fast AF, Inc | ||
Business Acquisition [Line Items] | ||
Fair Value | 12,925 | |
Assembled workforce | Fast AF, Inc | ||
Business Acquisition [Line Items] | ||
Fair Value | $ 12,490 | |
Useful Life (in years) | 1 year 6 months | |
ShopBrain | Developed technology | ||
Business Acquisition [Line Items] | ||
Fair Value | $ 9,488 | |
Useful Life (in years) | 3 years |
Balance Sheet Components - Property, Equipment and Software (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Total Property, equipment and software, at cost | $ 337,096 | $ 231,820 |
Less: Accumulated depreciation and amortization | (88,157) | (60,338) |
Total Property, equipment and software, net | 248,939 | 171,482 |
Internally developed software | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, equipment and software, at cost | 298,683 | 200,621 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, equipment and software, at cost | 19,394 | 16,169 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, equipment and software, at cost | 12,192 | 10,751 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total Property, equipment and software, at cost | $ 6,827 | $ 4,279 |
Balance Sheet Components - Goodwill and Intangible Assets (Details) $ in Thousands |
6 Months Ended |
---|---|
Dec. 31, 2022
USD ($)
| |
Goodwill [Roll Forward] | |
Beginning balance | $ 539,534 |
Additions | 0 |
Effect of foreign currency translation | (11,904) |
Ending balance | $ 527,630 |
Balance Sheet Components - Expected Future Amortization Expense (Details) $ in Thousands |
Dec. 31, 2022
USD ($)
|
---|---|
Balance Sheet Related Disclosures [Abstract] | |
2023 (remaining six months) | $ 14,644 |
2024 | 21,520 |
2025 | 7,167 |
2026 | 4,988 |
2027 and thereafter | 15 |
Total amortization expense | $ 48,334 |
Balance Sheet Components - Other Assets (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Balance Sheet Related Disclosures [Abstract] | ||
Derivative instruments | $ 69,615 | $ 49,983 |
Operating lease right-of-use assets | 43,614 | 50,671 |
Equity securities, at cost | 43,172 | 43,172 |
Processing reserves | 35,411 | 26,483 |
Prepaid expenses | 34,306 | 37,497 |
Prepaid payroll taxes for stock-based compensation | 14,338 | 35,172 |
Other receivables | 21,739 | 17,221 |
Other assets | 27,064 | 21,368 |
Total other assets | $ 289,259 | $ 281,567 |
Balance Sheet Components - Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Offsetting [Abstract] | ||
Collateral held for derivative instruments | $ 68,374 | $ 55,779 |
Operating lease liability | 57,492 | 65,713 |
Accrued expenses | 52,865 | 67,343 |
Contingent consideration liability | 12,510 | 23,348 |
Other liabilities | 29,378 | 25,415 |
Total accrued expenses and other liabilities | $ 220,619 | $ 237,598 |
Leases - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
Jun. 30, 2022 |
|
Lessee, Lease, Description [Line Items] | |||||
Restricted cash | $ 424,460 | $ 247,402 | $ 424,460 | $ 247,402 | $ 295,636 |
Impairment expense | 0 | 0 | |||
Sublease Income | $ 900 | $ 900 | $ 1,700 | $ 1,500 | |
Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease termination notice period | 9 months | ||||
Remaining lease term | 1 year | 1 year | |||
Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease termination notice period | 1 year | ||||
Remaining lease term | 8 years | 8 years | |||
Cash collateral and deposits for letters of credit | |||||
Lessee, Lease, Description [Line Items] | |||||
Restricted cash | $ 9,700 | $ 9,700 | $ 9,700 |
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Leases [Abstract] | ||||
Operating lease expense | $ 3,672 | $ 3,692 | $ 7,516 | $ 7,500 |
Leases - Schedule of Lease Term and Discount Rate (Details) |
Dec. 31, 2022 |
---|---|
Leases [Abstract] | |
Weighted average remaining lease term (in years) | 4 years 3 months 18 days |
Weighted average discount rate | 4.70% |
Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Leases [Abstract] | ||
2023 (remaining six months) | $ 6,291 | |
2024 | 16,503 | |
2025 | 16,317 | |
2026 | 15,371 | |
2027 and thereafter | 10,368 | |
Total lease payments | 64,850 | |
Less imputed interest | (7,358) | |
Present value of lease liabilities | $ 57,492 | $ 65,713 |
Debt - Aggregate Future Maturities of Funding Debt (Details) - Funding debt - Revolving facilities - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Line of Credit Facility [Line Items] | ||
Funding debt, year one | $ 177,864 | $ 158,547 |
Funding debt, year two | 520,794 | 421,484 |
Funding debt, year three | 460,715 | 0 |
Funding debt, year four | 193,954 | 0 |
Funding debt, after year four | 541,125 | 103,364 |
Total | 1,894,452 | 683,395 |
Deferred debt issuance costs | (11,782) | (10,818) |
Total funding debt, net of deferred debt issuance costs | $ 1,882,670 | $ 672,577 |
Debt - Convertible Notes Outstanding (Details) - Convertible Senior Notes - Convertible Debt - USD ($) $ in Thousands |
Dec. 31, 2022 |
Nov. 23, 2021 |
---|---|---|
Line of Credit Facility [Line Items] | ||
Principal Amount | $ 1,725,000 | $ 1,725,000 |
Unamortized Discount and Issuance Cost | (16,221) | |
Total funding debt, net of deferred debt issuance costs | $ 1,708,779 |
Securitization and Variable Interest Entities - Additional Information (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Fair value | $ 944,890 | $ 1,899,212 |
Securitization notes receivable and certificates | ||
Debt Instrument [Line Items] | ||
Fair value | $ 32,766 | $ 51,678 |
2021-B | ||
Debt Instrument [Line Items] | ||
Percentage of residual certificates retained | 100.00% | |
2020-A | ||
Debt Instrument [Line Items] | ||
Percentage of residual certificates retained | 100.00% | |
2020-Z1 | ||
Debt Instrument [Line Items] | ||
Percentage of residual certificates retained | 100.00% | |
2021-A | ||
Debt Instrument [Line Items] | ||
Percentage of residual certificates retained | 100.00% | |
2021-Z1 | Funding debt | Other Assets | ||
Debt Instrument [Line Items] | ||
Pledged securities | $ (47) |
Securitizations and Variable Interest Entities - Aggregate Carrying Value of Financial Assets and Liabilities from Consolidated VIEs (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Assets | $ 7,804,751 | $ 6,973,792 |
Liabilities | 5,294,603 | 4,355,537 |
Consolidated Variable Interest Entities | ||
Debt Instrument [Line Items] | ||
Assets | 3,279,490 | 2,242,269 |
Liabilities | 3,050,807 | 2,166,529 |
Net Assets | 228,683 | 75,740 |
Consolidated Variable Interest Entities | Warehouse credit facilities | ||
Debt Instrument [Line Items] | ||
Assets | 1,911,540 | 563,207 |
Liabilities | 1,734,754 | 534,422 |
Net Assets | 176,786 | 28,785 |
Consolidated Variable Interest Entities | Securitizations | ||
Debt Instrument [Line Items] | ||
Assets | 1,367,950 | 1,679,062 |
Liabilities | 1,316,053 | 1,632,107 |
Net Assets | $ 51,897 | $ 46,955 |
Securitizations and Variable Interest Entities - Aggregate Carrying Value of Financial Assets and Liabilities from Unconsolidated VIEs (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Assets | $ 7,804,751 | $ 6,973,792 |
Liabilities | 5,294,603 | 4,355,537 |
Variable Interest Entity, Not Primary Beneficiary | ||
Debt Instrument [Line Items] | ||
Assets | 653,754 | 996,242 |
Liabilities | 635,677 | 965,909 |
Net Assets | 18,077 | 30,333 |
Maximum Exposure to Losses | 32,719 | 51,248 |
Variable Interest Entity, Not Primary Beneficiary | Securitizations | ||
Debt Instrument [Line Items] | ||
Assets | 653,754 | 996,242 |
Liabilities | 635,677 | 965,909 |
Net Assets | 18,077 | 30,333 |
Maximum Exposure to Losses | $ 32,719 | $ 51,248 |
Investments - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
Jun. 30, 2022 |
|
Investments, All Other Investments [Abstract] | |||||
Gross proceeds from matured or redeemed securities | $ 473,300 | $ 584,900 | $ 2,154,400 | $ 635,600 | |
Equity securities, at cost | $ 43,172 | $ 43,172 | $ 43,172 |
Fair Value of Financial Assets and Liabilities - Fair Value of Servicing Assets (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Servicing Asset at Fair Value, Amount [Roll Forward] | ||||
Fair value at beginning of period | $ 1,142 | $ 2,287 | $ 1,192 | $ 2,349 |
Initial transfers of financial assets | 404 | 645 | 433 | 1,114 |
Subsequent changes in fair value | (453) | (754) | (532) | (1,285) |
Fair value at end of period | $ 1,093 | $ 2,178 | $ 1,093 | $ 2,178 |
Fair Value of Financial Assets and Liabilities - Fair Value of Servicing Liabilities (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Servicing Liability at Fair Value, Amount [Roll Forward] | ||||
Fair value at beginning of period | $ 3,152 | $ 3,610 | $ 2,673 | $ 3,961 |
Initial transfers of financial assets | 2,207 | 6,749 | 4,195 | 8,724 |
Subsequent changes in fair value | (1,679) | (1,733) | (3,188) | (4,059) |
Fair value at end of period | $ 3,680 | $ 8,626 | $ 3,680 | $ 8,626 |
Fair Value of Financial Assets and Liabilities - Fair Value of Performance Fee Liability (Details) - Performance Fee Liability - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 1,763 | $ 1,335 | $ 1,710 | $ 1,290 |
Purchases of loans | 572 | 503 | 1,051 | 833 |
Repayments | (501) | 0 | (501) | 0 |
Subsequent changes in fair value | 42 | (308) | (384) | (593) |
Fair value at end of period | $ 1,876 | $ 1,530 | $ 1,876 | $ 1,530 |
Fair Value of Financial Assets and Liabilities - Fair Value of Residual Trust Certificates (Details) - Residual Trust Certificates Held by Third-Parties in Consolidated VIEs - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 308 | $ 745 | $ 377 | $ 914 |
Repayments | (78) | (148) | (177) | (403) |
Subsequent changes in fair value | 12 | 22 | 42 | 108 |
Fair value at end of period | $ 242 | $ 619 | $ 242 | $ 619 |
Fair Value of Financial Assets and Liabilities - Fair Value of Senior Notes and Residual Trust Certificates (Details) - Senior Notes And Residual Trust Certificates - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 41,503 | $ 13,744 | $ 51,678 | $ 16,170 |
Additions | 0 | 13,695 | 0 | 13,695 |
Cash received (due to payments or sales) | (9,063) | (2,080) | (18,835) | (4,384) |
Change in unrealized gain (loss) | 138 | (73) | (510) | (184) |
Accrued interest | 295 | 84 | 748 | 70 |
Reversal of (impairment on) securities available for sale | (107) | (51) | (315) | (48) |
Fair value at end of period | $ 32,766 | $ 25,319 | $ 32,766 | $ 25,319 |
Fair Value of Financial Assets and Liabilities - Fair Value of Contingent Consideration (Details) - Contingent Consideration - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 24,269 | $ 290,719 | $ 23,348 | $ 153,447 |
Subsequent changes in fair value | (12,062) | (34,026) | (9,302) | 107,567 |
Effect of foreign currency translation | 303 | (2,943) | (1,536) | (7,264) |
Fair value at end of period | $ 12,510 | $ 253,750 | $ 12,510 | $ 253,750 |
Fair Value of Financial Assets and Liabilities - Fair Value of Profit Share Liability (Details) - Commercial Agreement, Profit Share Liability - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Fair value at beginning of period | $ 1,876 | $ 1,400 | $ 1,987 | $ 2,464 |
Facilitation of loans | 2,342 | 2,534 | 3,475 | 3,574 |
Actual performance | 612 | (1,011) | (2,264) | (1,011) |
Subsequent changes in fair value | (1,133) | (871) | 499 | (2,975) |
Fair value at end of period | $ 3,697 | $ 2,052 | $ 3,697 | $ 2,052 |
Stockholders' Equity - Common Stock Reserved for Issuance (Details) - shares |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance (in shares) | 94,133,026 | 84,314,979 |
Available outstanding under stock option plan | ||
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance (in shares) | 54,689,282 | 53,158,233 |
Available for future grant under stock option plan | ||
Class of Stock [Line Items] | ||
Total common stock reserved for future issuance (in shares) | 39,443,744 | 31,156,746 |
Equity Incentive Plans - RSU Activity (Details) - Restricted stock units |
6 Months Ended |
---|---|
Dec. 31, 2022
$ / shares
shares
| |
Number of Shares | |
Beginning balance, Non-vested (in shares) | shares | 21,387,592 |
Granted (in shares) | shares | 9,860,752 |
Vested (in shares) | shares | (6,263,666) |
Forfeited, expired or cancelled (in shares) | shares | (2,106,144) |
Ending balance, Non-vested (in shares) | shares | 22,878,534 |
Weighted Average Grant Date Fair Value | |
Beginning balance, Non-vested (in USD per share) | $ / shares | $ 38.41 |
Granted (in USD per share) | $ / shares | 27.48 |
Vested (in USD per share) | $ / shares | 34.50 |
Forfeited, expired or cancelled (in USD per share) | $ / shares | 39.77 |
Ending balance, Non-vested (in USD per share) | $ / shares | $ 34.64 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Income Tax Disclosure [Abstract] | ||||
Income tax (benefit) expense | $ (1,568) | $ 276 | $ (1,748) | $ 447 |
Net Loss per Share Attributable to Common Stockholders - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Dec. 31, 2022 |
Sep. 30, 2022 |
Dec. 31, 2021 |
Sep. 30, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Numerator: | ||||||
Net Loss | $ (322,437) | $ (251,269) | $ (159,735) | $ (306,615) | $ (573,706) | $ (466,350) |
Denominator: | ||||||
Basic weighted average common shares outstanding (in shares) | 293,683,331 | 281,533,888 | 292,306,300 | 273,588,094 | ||
Diluted weighted average common shares outstanding (in shares) | 293,683,331 | 281,533,888 | 292,306,300 | 273,588,094 | ||
Net loss per share: | ||||||
Basic (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) | ||
Diluted (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) | ||
Class A common stock | ||||||
Numerator: | ||||||
Net Loss | $ (256,451) | $ (121,609) | $ (455,739) | $ (332,251) | ||
Net Loss Attributable to Common Stockholders | $ (256,451) | $ (121,609) | $ (455,739) | |||
Denominator: | ||||||
Basic weighted average common shares outstanding (in shares) | 233,581,678 | 214,335,757 | 232,201,361 | 194,918,082 | ||
Diluted weighted average common shares outstanding (in shares) | 233,581,678 | 214,335,757 | 232,201,361 | 194,918,082 | ||
Net loss per share: | ||||||
Basic (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) | ||
Diluted (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) | ||
Class B common stock | ||||||
Numerator: | ||||||
Net Loss | $ (65,986) | $ (38,126) | $ (117,967) | $ (134,099) | ||
Net Loss Attributable to Common Stockholders | $ (65,986) | $ (38,126) | $ (117,967) | |||
Denominator: | ||||||
Basic weighted average common shares outstanding (in shares) | 60,101,653 | 67,198,131 | 60,104,939 | 78,670,012 | ||
Diluted weighted average common shares outstanding (in shares) | 60,101,653 | 67,198,131 | 60,104,939 | 78,670,012 | ||
Net loss per share: | ||||||
Basic (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) | ||
Diluted (in USD per share) | $ (1.10) | $ (0.57) | $ (1.96) | $ (1.70) |
Segments and Geographical Information - Additional Information (Details) |
6 Months Ended |
---|---|
Dec. 31, 2022
segment
| |
Segment Reporting [Abstract] | |
Number of reportable segments | 1 |
Number of operating segments | 1 |
Segments and Geographical Information - Revenue by Geographic Area (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenue, net | $ 399,558 | $ 361,011 | $ 761,182 | $ 630,396 |
United States | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenue, net | 390,389 | 350,486 | 742,974 | 612,089 |
Canada | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenue, net | 9,121 | $ 10,525 | 18,135 | $ 18,307 |
Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total Revenue, net | $ 48 | $ 73 |
Segments and Geographical Information - Long-lived Assets by Geographic Area (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | $ 292,553 | $ 222,153 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | 288,989 | 217,532 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | 3,195 | 4,390 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | $ 369 | $ 231 |
Subsequent Events (Details) - Subsequent Event $ in Thousands |
Feb. 08, 2023
USD ($)
employee
|
Feb. 01, 2023
USD ($)
|
---|---|---|
Subsequent Event [Line Items] | ||
Reduction of workforce | employee | 500 | |
Reduction of workforce (as a percentage) | 19.00% | |
Facility Closing | ||
Subsequent Event [Line Items] | ||
Expected restructuring costs | $ 11,000 | |
Minimum | ||
Subsequent Event [Line Items] | ||
Expected restructuring costs | 35,000 | |
Minimum | One-time Termination Benefits | ||
Subsequent Event [Line Items] | ||
Expected restructuring costs | 24,000 | |
Maximum | ||
Subsequent Event [Line Items] | ||
Expected restructuring costs | 39,000 | |
Maximum | One-time Termination Benefits | ||
Subsequent Event [Line Items] | ||
Expected restructuring costs | $ 28,000 | |
Butter Holdings, Ltd. | ||
Subsequent Event [Line Items] | ||
Purchase price, cash | $ 14,900 | |
Settlement of subordinated secured notes included in purchase price | $ 1,500 |
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