Klarna is betting massive on AI to scale its enterprise and form its model because it debuts on the general public market.
Chief Advertising and marketing Officer David Sandstrom advised ADWEEK that AI is now embedded throughout workflows, and helps drive $1 million in income per worker.
“After we first began with AI, it was extra like a celebration trick,” Sandstrom mentioned, including that AI is now central to Klarna’s day by day operations, powering all the things from analyzing buyer evaluations to designing advert campaigns, as the corporate is aggressively increasing its AI capabilities.
“The ambition at Klarna to guide AI and AI growth is greater than ever,” Sandstrom mentioned.
Klarna began buying and selling publicly on the New York Inventory Alternate on Wednesday, climbing practically 15% in its debut and valuing the funds agency at practically $20 billion.
Based practically 20 years in the past, Klarna earns income by taking a small reduce of transactions processed via its fee instruments, and from curiosity on longer-term loans and late charges.
Klarna solely entered the U.S. in 2019 however has since constructed a buyer base of 111 million, with purchase now, pay later and different monetary merchandise supplied via roughly 790,000 retailers, in line with its SEC filings. Over the 12 months ended June 30, the corporate dealt with $112 billion in transactions.
Klarna reported a Q2 lack of $53 million, up from an $18 million loss a yr in the past, whereas income grew 20% to $823 million.
AI on the core
Sandstrom advised ADWEEK that Klarna’s total advertising and marketing technique will proceed to make use of AI.
The fintech agency has leaned closely on the expertise to chop prices—trimming advertising and marketing spend by 12% final yr whereas decreasing reliance on companies—a development Sandstrom says has solely accelerated. Use of AI-driven content material manufacturing in its advertising and marketing crew has elevated asset output by 600%, Sandstrom mentioned.
Klarna has additionally signed a cope with Google to make use of its Nano Banana, Gemini, and Veo 3 instruments. Sandstrom mentioned AI is now embedded in day by day work, from analyzing buyer evaluations to designing advert campaigns. The corporate has continued hiring AI-focused roles like immediate engineers whilst different fintechs reduce. Sandstrom mentioned the corporate is creating an AI-powered purchasing assistant that may discover merchandise and full purchases on behalf of customers.
“The extra satisfied about AI the much less we’re measuring the impression of it,” he mentioned.
Market challenges persist
However Klarna’s public market debut comes as its core installment funds enterprise faces strain. Within the U.S., it trails Affirm by about $4 billion in fee quantity, in line with EMARKETER.
“The Swedish fintech’s essential mistake stateside was its delay in issuing a BNPL-enabled debit card,” mentioned Katherine Smith, funds analyst at EMARKETER. Affirm launched its “purchase now, pay later” debit card two years in the past, which helped cement its lead within the U.S. market. The cardboard has been central to Affirm’s in-store push, the place spending jumped 187% within the fourth quarter of 2024. Klarna solely started piloting its personal card in June.
Internationally, Klarna stays the stronger participant, reporting $25.3 billion in gross merchandise quantity—greater than double Affirm’s $10.4 billion. It has additionally scored partnerships with Walmart, DoorDash and eBay, giving it attain Affirm has struggled to copy.
Nonetheless, Smith mentioned card-linked installment plans from conventional banks are a good larger risk. Bank card issuers like American Categorical, Chase, and Citi can supply richer rewards than fintechs, which function on thinner margins. Klarna has tried to counter with cash-back gives and a partnership with rewards startup Nift, however these perks pale compared, she added.
Sandstrom mentioned Klarna is carving out a unique path, positioning itself with a extra consumer-friendly model that resonates with girls, in distinction to what he described because the “male, transactional” strategy of rival fintechs.
