Klarna is set to achieve profitability before the end of 2023, as indicated by the company’s first quarter results, which reveal that it has significantly reduced its losses.
The Swedish Buy Now, Pay Later (BNPL) firm reported a decrease in net losses to SKr1.3 billion for the first quarter, along with a reduction in credit losses of over a third. Klarna’s revenues rose to SKr4.9 billion, reflecting a 13% growth.
The company anticipates returning to profit by August or September this year. Klarna’s CEO, Sebastian Siemiatkowski, stated, “We are on track to achieve profitability this year.”
In 2022, Klarna faced a dramatic decline in valuation, dropping from $46 billion to $6.7 billion as part of a broader fintech slowdown, leading to a major company restructure. The firm reported a $1 billion loss for 2022, but its expansion into the US market has contributed positively to its recovery.
Recently, Klarna introduced an AI-powered personal shopping tool for consumers and formed a partnership with Airbnb to provide flexible payment options for guests in the US and Canada.