Why? With lower volume of transactions APT will have lower transaction costs and bad debt charges, as well as the ability to scale back expenditures on marketing and technology.
There is no reason why APT can't weather this storm, especially if there is a stimulus that helps (at least to some extend) people pay their existing Afterpay committments.
It's the existing debt that was always the problem but with Afterpay's dynamic credit model they will be scaling back risky borrower's limits as we speak and to some extend will shut them off completely. APT can reduce volume, reduce costs and use the $400m warchest to absorb any negative cashflow over the foreseeable future. By my calculations APT has more than 24 months before they would have to think about raising capital. For my analysis on APT expenses see the thread "Making sense of it all".
Happy for you to share your analysisas to why APT will head back down.
APT Price at posting:
$19.41 Sentiment: Hold Disclosure: Held