BNPL giant Klarna posts £1bn loss for 2022
Buy now, pay later (BNPL) fintech Klarna has reported a $1 billion loss for 2022, following on from the $680 million loss it recorded in 2021.
Despite the losses, the firm says it is edging towards profitability thanks to growth in its gross merchandise volume (GMV) of 22% year-on-year (YoY) and a 19% revenue boost in Q4 2022. Q4 2022 operating losses also declined. The company also embarked on a series of layoffs in May and September last year.
Much of the losses can be attributed to the firm’s expansion plans. Despite gloomy macroeconomic conditions, the firm has made substantial inroads into the US market.
The US now represents Klarna’s biggest revenue stream, a milestone it passed in December last year. GMV in the US market has rocketed by 71% YoY and the firm claims more than 34 million Americans are now Klarna customers.
In May 2022, Klarna says it began to “realign its business to the new macroeconomic environment”. These changes are now beginning to show with adjusted operating results improving 21% in just one quarter while H2 2022 showed a 44% improvement compared to H1 2022.
Klarna CEO Sebastian Siemiatkowski says: “Through a challenging macro environment, we have once again proven our resilience delivering high profitability across our established markets while launching products and services helping to diversify our revenues and solving problems for consumers.”