Affirm missed revenue forecasts. The stock is skyrocketing.

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Affirm holdings

the stock is skyrocketing even after the company reported earnings that missed analysts’ forecasts for net income.

Affirm reported a loss of 48 cents per share in the fourth quarter, missing a forecast of a loss of 29 cents, on sales of $ 261.8 million. Revenue exceeded expectations by $ 226.39 million. The buy-now-pay-ulter company also said it expects first-quarter revenue of $ 240 million to $ 250 million, higher than forecast of $ 234 million.

Affirm says it is gaining traction in smaller dollar items, signing up more merchants and expanding its services. The company reported 29,000 active merchants on its network, up from 5,700 a year earlier.

Sales are accelerating in categories such as fashion and beauty, as well as in “reopening” categories such as travel, which reached 14% of gross merchandise volume.

The company’s GAAP loss would have been narrower without the consideration of stock-based compensation and non-cash items. The company posted adjusted operating income of $ 14 million compared to a GAAP loss of $ 128 million.

Investors apparently placed more weight on earnings forecasts than earnings, as Affirm stock jumped 20% in after-hours trading.

Shares have been in tears since the company announced it had struck a deal with

Amazon.com

(AMZN) to offer its BNPL checkout service on the Amazon site, with the ambition to deploy it in the coming months. Affirm said its deal with Amazon was “non-exclusive,” however, indicating that other BNPL services may also be available on the e-commerce site.

Dan Dolev of Mizuho Securities called the results “exceptional” in a memo. Gross merchandise volume, excluding sales related to Peloton products, increased 178%, marking a “significant acceleration” from the 100% growth in the previous quarter, he noted.

Dolev reiterated a buy note on the stock and a target of $ 110, though that already looks outdated. The shares were trading at around $ 110 after-hours Thursday, after gaining 5.2% in the regular session. The stock was up 40% in the last month of trading at Thursday’s close and has gained 53% in the past three months.

Corrections and amplifications:Affirm reported 29,000 active traders on its network. An earlier version of this story said it brought in 29 million.

Write to Ben Levisohn at [email protected]