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Klarna‘s shares concluded their frist trading session above the initial public offering (IPO) price on Tuesday, signaling cautious optimism for the Buy Now, Pay Later (BNPL) giant as it navigates a competitive landscape and evolving regulatory environment. The Stockholm-based fintech firm’s stock closed at $9.73, a slight increase from its IPO price of $9.50, after a heavily oversubscribed offering.
The public debut arrives as Klarna, and the BNPL sector as a whole, face increased scrutiny regarding consumer debt and profitability. While Klarna’s valuation remains considerably below the $45.6 billion peak it reached in 2021 – fluctuating between $6.7 billion and $45.6 billion over the past four or five years – the stable opening suggests investor confidence in the company’s restructuring efforts and path toward sustainable growth.
For the quarter ending June 30th, Klarna reported $823 million in revenue on $31.2 billion in gross merchandise value.The company currently boasts 111 million active customers, with 98% of its transactions being interest-free, according to its most recent quarterly earnings report.
Comparatively,Affirm Holdings (AFRM),a key competitor,has a market capitalization of approximately $28.8 billion. Affirm generated $876 million in revenue last quarter on $10.4 billion in gross merchandise value. However, a larger portion - roughly 70% – of Affirm’s business stems from interest-bearing products, while Klarna prioritizes interest-free options.Affirm’s average order value is $276, placed by its 23 million active users.
Other significant BNPL players include Block’s Afterpay and PayPal (PYPL), though their diversified business models - encompassing broader payment processing and software solutions – complicate direct comparisons.
