What happened

Affirm Holdings (AFRM -0.45%) had a good day on Friday, with its stock price up about 2.4% as of 3 p.m. It had gone up as much as 7% mid-morning from the previous day's close, before settling down.

Affirm can attribute its good day to a strong earnings report from its partner Amazon.

So what

It has been a difficult year for Affirm, as the buy now, pay later company has struggled due to inflation, higher interest rates, a slowing economy, and high expenses. The stock price is down a whopping 73% year to date.

Despite that, it has maintained steady growth in payment volume, active users, and active merchants. One of those merchant partners is Amazon. Last year, Affirm inked a deal with Amazon to offer its installment payment service on most Amazon purchases over $50.

So, a good earnings report for Amazon was also good for Affirm. Amazon stock soared some 12% in early trading on Friday after beating revenue and earnings estimates in the second quarter. But the even better news for investors was the company's third-quarter outlook, which estimated net sales of $125 billion to $130 billion, which would be up some 13% to 17% year over year. 

Now what

A healthy third-quarter outlook for Amazon should bode well for Affirm, as the e-commerce giant is one of its largest partners. As bleak as it has been this year, Affirm's stock price is actually up 11% since the company posted its fiscal second-quarter results on May 12.

The company posts its fiscal third-quarter results on Aug. 25, so keep an eye on that to see if it can continue its positive momentum. It is a big hole to dig out of, and it's not clear if it has hit the bottom yet, but the upcoming earnings should provide more clarity.