3 reasons why Klarna’s assessment dropped 69% of her peak just a few years ago

In 2021, the Swedish giant of BNPL soaked during subsequent fundraising, first becoming the champion of the European startup and coming only behind Stripe among the Fintech in the world. However, an IPO of $ 14 billion represents an arc of redemption for a company that could easily have been another edifying story – its valuation plunged up to 85%, at 6.7 billion dollars by 2022. Klarna cleaned its finances, diversified by ADS and consumers, and now resembles a disciplined fintech platform that A free expenditure rocket.

The company, supported by investors, including Sequoia Capital and Silver Lake, has filed an initial American public supply which could arrive by the end of the year. It would be among the biggest announcements of a European technological business in recent years. At its peak in 2021, Klarna was evaluated above than certain European banks. But the increase in interest rates, the stricter regulation of BNPL services and the skepticism of investors towards growth without profit led Klarna to reduce operating costs, reduce staff and seek capital to gradually lower assessments.

During the last quarters, Klarna reported progress. The losses have shrunk and management has increased from expansion of expansion to measured growth and profitability. Analysts say that its large merchant network and its adoption of consumers remain competitive advantages, although questions persist on the sustainability of its payment model in a higher rate environment. In his regulatory file, Klarna said he was profitable during his first 14 years before developing in the United States and other markets, and he has not recorded an annual profit since 2018. “In 2023, our operating loss began to decrease and we started to generate dollars of positive transaction margin in the United States,” said the company in his regulatory file. So why has Klarna collapsed after her profits-and why does he go to an apparent rebound in public procurement?

1) The end of low interest rates

Technological assessments in general have suffered since 2022, when the federal reserve has increased aggressively to combat the increase in inflation. Many frothy commercial models that depended on easy credit – the most important BNPL among them – have been required as capital has become more expensive. The wider macroeconomic volatility has weighed on many companies similar to Klarna, because geopolitical disorders and commercial policy uncertainty have combined to put a ceiling on investment.

The S&P 500 has become extraordinarily concentrated, sometimes led by the “Magnificent Seven”, and recently the magnificent six without Tesla. Nvidia has reached remarkable market capitalization of $ 4 billions and can move the markets now due to its tremors. Sometimes the S&P 500 is more like the S&P 10.

2) Consumer slowdown

The American consumer is the engine of the American economy, responsible for two thirds of GDP most of the years. And yet, something funny happened in 2025, because the massive rise in the construction of data centers associated with the AI ​​revolution has contributed more to the growth of GDP than outgoing consumers and purchases. This does not mean that the construction of the data center is two thirds of the GDP, but that it increases faster than the average consumer, who shows signs of fatigue in the middle of a stagnant labor market and a backdrop of inflation.

The chief economist of Apollo Global, Torsten Slok, warned that inflation could resume its rise in the rise of the rise of 2021 that Klarna’s largest assessment, seeing a potential “mountain of inflation”, is looming. On the other hand, consumers who are short of money can turn more in BNPL services, as Lendingtree found that 14% of American adults who used services to buy grocery products in 2024 were 25% next year. Consumers can slow down, but increased inflation and even a recession could push them more in purchasing financing using BNPL services.

3) Regulatory examination

Klarna was examined with a meticulous examination of the Consumer Financial Protection Office (CFPB) during the Biden administration, which has certainly favored stronger regulations than the CFPB as part of one or the other Trump diet. Some senators and prosecutors of the State urged the CFPB to take a stronger supervision with BNPL companies, expressing the concerns that low -income vulnerable consumers were at risk of being targeted.

The industry retaliated, with a commercial group which included Klarna continuing the CFPB at a given time of the “impossible” disclosure rules. Since 2025, the CFPB has prioritized the federal application in the BNPL, indicating a transition to fragmented monitoring, with expectations for actions and regulatory frameworks more directed by the State.

Can the unicorn roll again?

In the past two years, the company has rebuilt by emphasizing the reduction of losses, by expanding in adjacent companies such as advertising and working on profitability. The IPO should test the appetite of investors for financial technologies which formerly commanded vertiginous evaluations but are now faced with a more traditional examination of the public market on margins and income.

The list, expected in New York later this year, will always mark one of the most important European stock market IPOs in the decade. Investors will monitor closely to see if Klarna’s new chapter proves that it can exceed its BNPL roots – or if the fintechs once hot will find it difficult to resume their private market.

For this story, Fortune Used a generative AI to help an initial project. An editor checked the accuracy of the information before the publication.

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