Buy now, pay later giant Klarna ready for float as it posts first monthly profit in three
Buy now, pay later giant Klarna ready for float as it posts first monthly profit in three years
Klarna is ready to press the button on a stock market listing once the economic backdrop improves as the buy now, pay later giant posted its first monthly profit in three years.
Sebastian Siemiatkowski, who heads the Swedish company, said Klarna now met the three requirements it needed – having a sustainable business model, a clear growth strategy and strong presence in the US.
He said: ‘Now, it’s more market conditions, a question of us getting ready. We don’t have any official date; we haven’t announced anything.’
Klarna, which allows shoppers to defer and split the cost of items, said revenues in the second quarter rose 17 per cent to £400million, while it cut losses to £56million from £83million last year.
The total value of payments using Klarna products climbed 13 per cent in the first six months of the year to £32billion.
Listing: Klarna, advertised by Paris Hilton (pictured), said revenues in the second quarter rose 17% to £400m, while it cut losses to £56m
Although the company last made a full-year profit in 2018, and its last quarterly profit in the second quarter of 2019, it made a small profit in May.
But Klarna has had a bumpy ride after it had to slash its valuation by 85 per cent to £5.3billion in a funding round last summer.
The business – once Europe’s most valuable fintech firm – has been battered by inflation and war in Ukraine.
It has axed more than 10 per cent of staff and shifted its focus to profitability.
Siemiatkowski said: ‘Some claimed Klarna would face difficulties in the tough macro-economic climate with high interest rates but having led it through the 2008 financial crisis I knew we had a strong and resilient business model to see us through.
Despite the volatile environment, we have done exactly what we set out to do.’
Fellow buy now, pay later firm Zilch has revealed it was on track for profitability as it continues discussions with more than 15 banks in preparation for an eventual float, though the firm is yet to decide on a location or date, Bloomberg reported.
Philip Belamant, the boss of the platform, hinted that he may consider a listing in London. He added: ‘The market is just starting to thaw.
‘There are a few floats coming down the track that we’re watching. We’ll make that decision at the right time’.