May 30, 2024

Klarna reports profitable start to the year as listing rumours mount

Revenue increased 29% year-on-year to €55m, with strong performance in the US

Amy Lewin

2 min read

Klarna has announced an adjusted profit for the first quarter of 2024 — the second time it's been in the black in the last three quarters.

The buy now, pay later giant released its financial results for Q1 2024 on Thursday, which stated revenue increased 29% year-on-year, reaching SEK 6.4bn (€550m). Adjusted operating income was 229m SEK (€21.6m).

The Stockholm-based fintech unicorn also reported strong performance in the US — where it is widely anticipated to list next year — with a 38% increase in year-on-year revenue and gross profit rising by 97%.


AI's helping hand

Klarna CEO Sebastian Siemiatkowski credited "the power of AI" in helping "lower operating expenses" at the company by 11% over the year.

Sales and marketing, customer service and operations and general and administrative costs have all dropped in Q1 2024 compared to Q1 2023.

Net credit losses, meanwhile, have increased since Q1 2023 — rising from SEK 775m to SEK 1.2bn.

90% of Klarna employees are now using AI at work, the company says. Its AI assistant has also helped 4m customers — and reduced repeat inquiries by 25%, delivering annualised savings of $40m, its quarterly report says.

That's an uptick from the start of the year. In February, when Klarna released its figures for 2023, Siemiatkowski said half of his employees were using AI.

The listing

Speculation is mounting over where and when Klarna may choose to list. On Wednesday, Sky News reported the fintech giant is looking to list in New York early next year.

In May, Siemiatkowski told Bloomberg his company is "definitely ready" to IPO ‚ and strongly hinted that it might do so in the US.

“We wanted to establish ourselves as a global business — that meant success in the US, both in awareness and profitability,” Siemiatkowski said on Bloomberg TV. “With almost 40m users in the US, and it being profitable – actually our largest market by revenue — those kinds of criteria have been met.”

Amy Lewin

Amy Lewin is Sifted’s editor and cohost of Startup Europe — The Sifted Podcast , and writes Up Round, a weekly newsletter on VC. Follow her on X and LinkedIn