Klarna releases first half and Q2 results, CEO says ready for IPO at any time

It is learned that on August 31, BNPL payment giant Klarna released its second quarter and first half financial report, achieving its first monthly profit in nearly three years, and expecting better performance in the second half of the year. At the same time, Klarna CEO said at the financial report meeting that the company has met the conditions for an IPO and will go public at any time if the market environment improves.

In the first half of this year, Klarna's operating revenue was 9.2 billion Swedish kronor (843.8 million US dollars), an increase of 21% from 7.5 billion Swedish kronor in the same period last year, but it still failed to make a profit in the first half of the year, with a net loss of 2.1 billion Swedish kronor, a decrease of 67% from 6.4 billion Swedish kronor in the same period last year.

It is worth noting that in May, Klarna achieved its first monthly profit in nearly three years and turned a profit in the second quarter.

Data shows that Klarna's total GMV in the second quarter increased by 14% year-on-year, from 209.2 billion Swedish kronor (19.1 billion U.S. dollars) in the same period of 2022 to 238.6 billion Swedish kronor (21.8 billion U.S. dollars). Revenue growth was faster, increasing by 17% year-on-year, from 4.7 billion Swedish kronor (4.291 billion U.S. dollars) in the same period last year to 5.5 billion Swedish kronor (502.2 million U.S. dollars).

The improvement in profitability is due to the cost-cutting strategy that Klarna has implemented since last year. Last year, due to the economic environment, Klarna's market value shrank from US$46 billion to US$6.7 billion, evaporating 85%. So in May last year, Klarna announced a 10% layoff, and has since continued to implement a cost-cutting and efficiency-enhancing strategy.

Cost optimization also brings many other benefits, and coupled with Klarna’s strategy to attract customers, it has achieved significant growth in both the European and American markets. It is reported that Klarna has established 37 million users in the United States and has achieved growth for three consecutive quarters, while in Europe, Klarna’s usage rate has reached 50% to 80%.

From its founding in 2005 to 2018, Klarna has maintained stable profitability and invested heavily in its expansion into the United States. Klarna was once the most valuable unlisted startup in Europe, with a valuation of $46 billion. But before its IPO, Klarna began to suffer losses, and its IPO plan was temporarily shelved.

At the latest earnings conference, Klarna CEO Sebastian Siemiatkowski said that Klarna has currently met his three requirements for an IPO, including gaining a foothold in the U.S. market, having a sustainable business model, and having ample room for growth in the future.

But now it’s more a question of market conditions, and Klarna will be ready to go public as long as market conditions improve.

Editor✎ Ashley/

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