Wed, 10 Sep 2025

Wed, 10 Sep 2025 Klarna hits $19bn value in Wall Street debut

The buy-now, pay-later firm raises nearly $1.4bn as its shares start trading publicly.
Klarna's shares jumped on its first day of public trading in the US, giving the Swedish lender a market value of over $19 billion. The company raised $1.37 billion in an initial public offering (IPO), selling shares for $40 apiece. However, the stock price opened at $52 per share, which is 30% higher than the IPO price. Despite this, Klarna's shares ended the day lower, settling around $46 and valuing the company at $17 billion. This is a significant milestone for the Swedish lender, which has become a major player in the shopping space with over 93 million active users across 26 countries. Klarna's business model allows shoppers to pay for purchases in smaller, interest-free instalments, but it has faced criticism about the risk that this could lead people to spend beyond their means. The company handled transactions worth $105 billion last year and has a strong presence in its home country of Sweden, where over 80% of adults used the service. Klarna's CEO, Sebastian Siemiatkowski, said that the IPO will provide "fuel" for the company as it seeks to expand into new markets. However, the firm's profitability has suffered since entering the US due to higher costs for processing transactions. Klarna reported a $52 million loss in the three months to June, up from $7 million a year ago. The company's revenue grew 24% year-on-year to $2.8 billion last year, but it faces challenges ahead as it prepares for a "likely recession". The firm plans to axe around 700 workers and will share payment habits with credit reference agencies, which could help or hinder credit applications. Providers will also make terms and conditions clearer amid concerns that consumers could be at risk. Interest in buy now pay later options is surging, with growth fastest among users in their 40s and 50s.
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