- Klarna stock dropped over 20% from its post-IPO peak of $57 to around $44, early profit-taking and valuation concerns cooled the initial hype
Klarna Group, the Swedish fintech giant best known for its buy now, pay later (BNPL) services, made a highly anticipated debut on the New York Stock Exchange this week, but the early excitement is already fading. Klarna stock opened strongly, climbing as high as $57 in its first session, before reversing sharply to close at $45. It is now trading near $44.73, wiping out most of its initial gains and giving the company a market capitalization of roughly $17 billion.
The price action underscores a common pattern in newly listed tech companies: an initial pop fueled by hype, followed by a quick correction as early buyers lock in profits and the market reassesses valuation.
Rapid Growth, Lingering Losses
Klarna operates primarily in Europe and the United States, offering interest-free installment payment solutions that have surged in popularity with younger consumers. Its growth metrics are impressive. Revenue rose from $661 million in Q2 2024 to $823 million in Q2 2025, while its transaction and service segment generated $604 million. Interest income climbed to $219 million from $164 million a year earlier.
The company’s gross merchandise value (GMV) hit $31.2 billion, up from $25 billion, while active users surged to 111 million from 85 million, and merchant partners are nearing 800,000. Despite that scale, Klarna posted a $53 million net loss in the most recent quarter, wider than the $18 million loss last year. Klarna was profitable in the past but has ramped up spending to fend off competition from Affirm and Afterpay.
Could Klarna rebound long-term?
If Klarna can tighten its costs and return to profitability while sustaining double-digit revenue growth, the stock has room to recover. The company’s massive user base, merchant network, and rising GMV give it leverage to scale margins over time. While short-term volatility is likely, the long-term case hinges on execution, and Klarna has the market footprint to eventually deliver.
Klarna FAQs
No. Klarna reported a $53 million loss in its latest quarter, up from $18 million last year, as it spends heavily to defend market share against rivals like Affirm and Afterpay.
Very quickly. Revenue rose from $661 million in Q2 2024 to $823 million in Q2 2025. Active users grew to 111 million and merchants are nearing 800,000, making Klarna one of the largest BNPL platforms globally.
Affirm has a market cap above $27 billion, versus Klarna’s $17 billion, and recently posted a $69 million profit. Klarna has more users and merchants but remains loss-making, which some see as its main risk.
Typically six months after an IPO, insiders and employees can sell their shares. This can pressure the stock price if large volumes hit the market at once.
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