Affirm Chief Financial Officer Michael Linford acknowledged Thursday the company may have lost its status as Amazon’s sole buy now, pay later provider, but Affirm aims to remain competitive on that retail site.  

E-commerce behemoth Amazon is “so big, so complicated and so focused on the consumer that they’re not going to let their options be curtailed,” Linford said during a Thursday fireside chat with Credit Suisse analysts. “We know that and we’ve built a business that can win its fair share there.”

The last day of January marked the end of San Francisco-based Affirm’s exclusivity provision with Amazon, meaning that Affirm was the only installment loan provider for the e-commerce giant’s customers.

The two companies still have a general commercial agreement that runs through Jan. 31, 2025, and that agreement can be extended for successive one-year terms, according to a November 2021 filing with the Securities and Exchange Commission. 

An Amazon spokesperson declined to comment Thursday on whether the company plans to work with other BNPL providers. 

A Klarna spokesperson declined to comment on whether the Stockholm-based BNPL company is in talks to offer its services to Amazon customers. Spokespeople for other BNPL providers Afterpay, Sezzle and Zip didn’t immediately respond to requests for comment.

Amazon, Affirm’s largest merchant partner based on gross merchandise volume, represented about 23% of Affirm’s total GMV for the quarter ending Dec. 31, 2022, according to the BNPL company’s most recent quarterly filing with the Securities and Exchange Commission. The two struck an agreement in 2021.

Affirm executives are keen to grow that figure, given Amazon’s position in e-commerce. “We feel like there’s a lot of runway left there,” Linford said Thursday.

Affirm is one of many payment options on Amazon’s checkout page, he acknowledged. “Our position on Amazon has always been competitive,” Linford said.

But Amazon knows Affirm is reaching users who aren’t likely to take up the other financing offers Amazon puts forth, Linford asserted. Affirm’s interest-bearing loans make up the majority of its business with Amazon, he said. 

For Affirm, “that’s how they make their revenue to cover the losses, and they can do it profitably by charging the consumer,” said Autonomous Research Analyst Rob Wildhack.

Affirm’s BNPL rivals that focus more on no-interest, pay-in-4 products might find a relationship with Amazon to be a money-losing proposition, he noted.

In an intensely competitive market, Affirm needs to do the basics well, including ensuring Amazon’s customers have a good experience with the BNPL provider, Linford said. The goal is to have conversations with Amazon about how Affirm can do more for Amazon’s customers, he said. 

“There’s a lot of opportunity for us to continue to expand the product set there and address, again, more transaction types,” Linford said.


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