Affirm Investors Misled by Tweet Previewing Q2 Financial Results, Class Action Alleges

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A proposed class action claims Affirm Holdings investors were misled when a February 10 Tweet from the fintech company supposedly mischaracterized its second quarter 2022 financial results.

According to the 10-page case, Affirm’s Tweet was “materially misleading” in that it painted a rosy picture of the company’s second quarter results while failing to disclose the details in full. The lawsuit says Affirm’s share prices spiked nearly 10 percent after the Tweet was issued and then fell roughly 32 percent, injuring investors financially, when the company later deleted the message and released its full second quarter results, in which it disclosed a loss of $0.57 per share.

The case contends that it was “severely reckless” of the defendants to post a Tweet that contained only “selected metrics” from Affirm’s financial results because it misled investors into believing the company had performed better than it actually did.

“The Tweet omitted material details, including that Affirm’s quarterly loss was $0.57 per share, which was necessary in order to make the statement made not misleading,” the complaint states, alleging that investors who purchased Affirm stock after the Tweet was posted were harmed financially when the company’s share prices sharply declined later that day.

According to the case, Affirm, a fintech company who offers “buy now, pay later” services to consumers, planned to announce its second quarter financial results after the markets closed on February 10, 2022. Earlier that day, however, the company’s official Twitter account allegedly posted at about 1:15 p.m. a Tweet that stated:

The lawsuit alleges that the Tweet, which contained only a sampling of the company’s financial results for that quarter, painted a far rosier picture of Affirm’s performance than was actually the case. According to the suit, the company later deleted the Tweet and released its full second quarter 2022 financial results earlier than expected on the same day. 

Per the case, the results were “far less impressive” than investors were led to believe from the company’s Tweet, which had caused Affirm’s share prices to climb 10 percent. The suit says, for example, that Affirm posted a loss of $0.57 per share, which was “far worse” than analysts’ expectations of $0.37 per share.

Following the release of the company’s full financial results, Affirm’s share prices sank roughly 32 percent to close at $58.68 per share on February 10, the case relays.

The lawsuit looks to represent persons or entities who purchased or otherwise acquired Affirm securities on February 10, 2022 after the company posted its Tweet concerning its second quarter financial results at roughly 1:15 p.m.

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