Klarna Reports 27% Revenue Surge as It Eyes 2024 U.S. IPO

Klarna Bank AB reported a 27% increase in revenue for the first half of the year, boosting its adjusted profit to 673 million kronor ($66 million) for the quarter ending in June. This marks a significant turnaround from the 456 million kronor loss recorded during the same period last year.

The Stockholm-based fintech attributed its improved profitability to controlled operating expenses and strategic investments in artificial intelligence, which now handles tasks equivalent to the work of 700 employees, according to CEO Sebastian Siemiatkowski.

Klarna’s strong performance comes as the company prepares for a potential U.S. initial public offering (IPO) next year, which could value the firm at $20 billion. The company is reportedly close to selecting Goldman Sachs to lead the offering.

In anticipation of the IPO, Klarna has engaged in early discussions with investors for a secondary share sale, aimed at enhancing its valuation. While the projected $20 billion valuation would surpass the $6.7 billion from a 2022 funding round, it remains significantly lower than the $45.6 billion peak valuation in 2021.

To streamline operations and focus on growth, Klarna has recently divested its Checkout payments business for about $520 million and acquired New Zealand-based buy-now, pay-later provider Laybuy.