Retail News CRM

Tag: Klarna

  • Klarna Revives IPO Plans: What to Expect from the Leading Buy Now, Pay Later Giant

    Klarna Revives IPO Plans: What to Expect from the Leading Buy Now, Pay Later Giant

    In a bold resurgence after a period of uncertainty, Swedish fintech giant Klarna is poised to make a fresh bid for a U.S. stock market listing, with plans reportedly set for September. This follows an earlier withdrawal of its IPO ambitions, prompted by turbulent U.S. tariffs that unsettled the financial landscape earlier this year.

    According to sources familiar with the matter, Klarna aims for a valuation between $13 billion and $14 billion as it attempts to capitalize on a more robust IPO environment. The initial pricing of shares is projected to fall between $34 and $36, with the company hoping to raise nearly $1 billion in the process.

    Klarna, famed for its “buy now, pay later” services, had initially aimed for an IPO back in 2021, when its valuation soared to almost $50 billion. The fintech’s ambition was sidelined by market turmoil at that time, but as they say, what goes down must come up — and Klarna seems ready for takeoff.

    Positive Shift in IPO Landscape

    The uptick in market sentiment in recent months has created a more favorable atmosphere for IPOs, especially in the U.S. Following a series of successful launches, companies like design software provider Figma and stablecoin powerhouse Circle have seen their shares skyrocket, with increases of 333 percent and an astonishing 864 percent, respectively, from their issue prices.

    Recent calculations from Reuters indicate that the largest U.S. IPOs this year have averaged a remarkable 36 percent rise on their first trading day, signaling a renewed investor appetite for new ventures.

    Growth Trajectory Amid Financial Struggles

    Despite its ambitious market maneuvers, Klarna’s financials reveal a complex picture. In the second quarter, the company reported a 20 percent year-on-year revenue increase, totaling $823 million, with an adjusted operating profit of $29 million—a modest $1 million increase from the previous year. Customer growth, on the other hand, was impressive, with active users climbing by 31 percent to reach 111 million. However, the clouds remain dark with a reported net loss of $53 million, nearly triple the losses seen in the same quarter of 2024.

    As Klarna sets its sights on the U.S. IPO, the coming months will be crucial in determining if this fintech darling can transform its aspirations into market success.

    Questions & Answers

    What is Klarna’s projected valuation for its upcoming IPO?
    Klarna is targeting a valuation between $13 billion and $14 billion for its upcoming IPO.

    What challenges did Klarna face that led to the postponement of its IPO?
    Klarna’s IPO plans were initially on hold due to sweeping U.S. tariffs that unsettled the global markets.

    How has Klarna’s financial performance changed recently?
    Klarna reported a 20 percent increase in revenue and a significant rise in active customers, but also faced a net loss of $53 million in the second quarter, nearly three times the loss from a year earlier.

  • H&M invests $20M in payments firm Klarna

    H&M invests $20M in payments firm Klarna

    Fast-fashion retailer H&M has taken an investment stake of less than 1% in Swedish fintech company Klarna for $20 million, reported the Financial Times reported. Beginning next year, Klarna will provide both in-store and online payment services for H&M, beginning with 14 European countries, including the U.K. and Sweden, according to a press release. The partnership could expand into the U.S. and Asia.

    By integrating payments across H&M’s channels, the goal is to provide customers “a seamless, personalized and engaging shopping experience,” the press release said. The new capabilities will involve frictionless mobile, in-store and online payments and will simplify deliveries and returns. It will also allow shoppers to determine when and how they pay, including try-before-you-buy services.

    The next generation of the H&M app and H&M Club loyalty and payment program will include these new features, the companies said.

    Facing a declining stock price and following a 10-quarter same-store sales slump, H&M has been moving aggressively throughout 2018 to bolster technology and merchandising. In March the company reported declining profits because of “weak sales development as well as higher markdowns,” but CEO Karl-Johan Persson predicted 25% sales growth for the rest of the year. The company has refocused on e-commerce and refined its merchandising mix and store count, even closing stores so as to expand on Alibaba’s Tmall.

    The company is using big data and artificial intelligence to customize the assortments in individual stores. H&M wants to reduce markdowns by using algorithms to analyze store receipts, returns and loyalty-card data, and is testing the technology in a Stockholm store. In August, it announced the roll-out of a new e-commerce site and mobile app, equipped with visual search capabilities specifically for the U.S. market. H&M is testing voice interactive mirrors at its New York City flagship store, which offer selfies, style advice and discounts via QR codes.

    The retailer is also investing in its supply chain by making it faster, more flexible and efficient through the use of proximity sourcing and automated warehouses. H&M plans to bring RFID to 1,800 stores in 2019. Earlier this year, it announced the launch of a new brand called Nyden aimed at Millennials and their increasing rejection of fast fashion. This follows the introduction last year of stores with a broader range of apparel for men, women and children branded as Arket. These stores also include home goods and some have cafes.

    H&M is investing in advanced technology that spans its online and offline channels, products and support services such as payments. Now it has invested in Klarna, which is known for a technology that allows customers to arrange for financing at the point of sale. For H&M, the retailer hopes the partnership will smooth out and streamline its payments options, delivery and return processes.

    “We want to make it possible for customers to move freely between the various channels and choose how they want to shop and experience our offering online and in-store,” H&M Head of Business Development Daniel Claesson said in the release. “This partnership will bring tailor-made payment solutions to our customers and accommodate evolving shopping patterns and needs.”