Klarna is projected to achieve its first billion-dollar quarter in Q4, fueled by remarkable growth in the US, increased card adoption, and enhanced productivity through artificial intelligence.
The buy now, pay later leader reported impressive results in its inaugural quarter as a public entity, exceeding analyst predictions. For Q3, revenue surged 26% year-over-year, reaching a record $903 million. The company welcomed 27 million new users and 235,000 new merchants, bringing the total to 850,000.
CEO and co-founder Sebastian Siemiatkowski anticipates surpassing $1 billion in revenue in Q4 2025. He remarked, “Q3 was our strongest quarter ever — proof that our AI-driven model is working at scale, with US revenue up 51% and GMV up 43%. The Klarna Card has seen significant uptake with four million sign-ups in just four months, and our Fair Financing option is gaining market share. Despite short-term profitability setbacks from accounting timing, we expect transaction margin dollars to increase by over $100 million in Q4 as revenue continues to grow.”
The debit-focused Klarna Card represents 15% of all Klarna transactions, and an additional one million consumers have joined Klarna’s membership program, enjoying premium benefits without accruing credit card debt.
The US market spearheaded Klarna’s growth, with GMV increasing by 43% and revenue climbing 51%. The Fair Financing product, which allows consumers to extend payment periods, saw a staggering 244% rise in gross merchandise value in the US, compared to 139% globally for Klarna.
Additionally, Klarna is experiencing advantages from its AI initiatives, claiming that revenue per employee has tripled over the past two years, while operating expenses have only risen by 2%.