Klarna’s First Public Earnings Report: Strong US Growth, ‘Neobanking’ and A.I.

<img fetchpriority="high" decoding="async" class="lazyload size-full-width wp-image-1601051" src="data:image/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==" data-src="https://observer.com/wp-content/uploads/sites/2/2025/11/GettyImages-2234678778.jpg?quality=80&w=970" alt="Man standing on trading floor" width="970" height="639" data-caption='CEO Sebastian Siemiatkowski says Klarna is evolving from BNPL to a full “neobank.” <span class=”lazyload media-credit”>Photo by Spencer Platt/Getty Images</span>’>

Today (Nov. 18), Klarna reported its first quarterly earnings as a public company. The fintech giant, which debuted on the New York Stock Exchange in September, is growing quickly as it leans into A.I. and looks to expand beyond its Buy Now, Pay Later (BNPL) service into more traditional banking offerings.

Klarna beat Wall Street expectations with $903 million in revenue for the July–September period, a 26 percent increase from a year earlier. In its largest market, the U.S., sales rose 51 percent from a year ago.

The company also posted gains in gross merchandise volume (GMV), an e-commerce metric measuring the value of goods sold. GMW jumped 23 percent year-over-year to $32.7 billion for the quarter. One gloomy spot was net income, which swung to a $95 million loss compared to a $12 million profit during the same period in 2024. Klarna attributed the decline partially to a change in accounting principles.

Demand also increased for Klarna’s “Fair Financing” option, which lets customers spread payments for larger purchases over longer periods. U.S. GMV for the offering jumped 244 percent during the quarter, while global GMV rose 139 percent. Fair Financing is now available at 151,000 merchants, or 18 percent of Klarna’s total merchant base.

Klarna is still best known for its BNPL services, but the company aims to shift “from payments to full neobank,” CEO Sebastian Siemiatkowski said during his company’s earnings call. A neobank refers to a fintech firm that offers banking services without a physical branches, such as Chime or Revolut.

In July, Klarna launched the “Klarna Card,” a payment card that combines BNPL features with a traditional debit card. The product has already gained more than 4 million signups, according to Siemiatkowski, and accounted for 15 percent of Klarna’s global transactions as of October.

Klarna slows hiring amid A.I. push

Klarna is also turning to A.I. to move into new areas. As an early adopter, the company has embraced the technology across personal shopping, internal productivity tools and even an A.I. avatar of Siemiatkowski capable of presenting earnings.

A.I. has transformed customer service as well: an A.I. assistant Klarna introduced last year now performs the work of more than 850 full-time employees and has saved the company $60 million, Siemiatkowski said. In part because of these efficiency gains, Klarna does not “believe that hiring is the right approach at this point in time,” he added.

That doesn’t mean the CEO is unconcerned about A.I.’s impact on workers. While blue-collar jobs are typically vulnerable during economic downturns, Siemiatkowski warned that A.I. could more heavily affect “high-income households and white-collar jobs.” He said he is closely monitoring unemployment trends to understand how the technology might affect consumers who rely on Klarna.