Klarna’s global push: From Stockholm to Silicon Valley

Klarna offers a simple service which is known as “Buy now, pay later”, letting consumers take up short-term loans to purchase goods and services. The service is available with a large number of retailers and service providers, and you can pay off the sum in full, in several interest-free installments, or deferred options aligned with payday schedules.

Klarna was founded in 2005 after the founders participated in the annual entrepreneurship competition at the Stockholm School of Economics. Since then, it has grown from a small fintech startup into the payment giant it is today. By 2011 around 40% of all e-commerce sales in Sweden were done through Klarna. The road has not been free of problems - layoffs, losses, decreasing valuation has been frequent events over the recent years, but now the trend seems to have changed. Q2 2025 was the company’s 5th consecutive quarter with operational profitability, with adjusted operating income reaching $29 million, up more than $26 million from the previous quarter. These financial results along with a high-profile IPO and a growing list of partnerships, suggest that Klarna might be entering a new phase. One defined by sustained profitability and not deeper integration into the retail ecosystem, not just by growth.

Klarna shares are currently trading between $38 and $39 on the New York Stock Exchange, slightly above the IPO price of $40 (Yahoo finance, 29.09.2025). During the first day of trading the shares opened at $52 before hitting an all-time high of over $57 per share.

While Klarna’s services have proven popular among consumers seeking flexibility, they have also drawn criticism. Consumer advocates warn that the “Buy now, pay later” models could encourage impulsive spending and result in debt accumulation, especially among youngers users who may not fully understand the implications of deferred payments. In Klarna’s defense, they focus on transparency and no-interest options along with a user-friendly interface. Unlike traditional credit cards, Klarna often does not charge interest or fees unless the user misses a payment.

Klarna’s ambition extend beyond Europe. The company has made serious foothold in the U.S. market, competing with firms like Affirm and Afterpay. They have established partnerships with major brands like Sephora, Macy’s, and DoorDash. It was also announced that they replaced competitor Affirm to offer “Buy now, pay later services” for retail giant Walmart. The partnership with DoorDash highlights their evolving strategy. It’s not just about buying clothes or electronics on credit anymore, Klarna wants to embed itself into daily, low-ticket spending habits from takeout dinners to morning coffee.

As Klarna expands from its Swedish roots to a global presence, its journey reflects both the promise and pitfalls of modern fintech. With growing profitability, high-profile partnerships, and an ambitious push into everyday spending, Klarna is redefining how consumers engage with credit. Whether this marks a revolution in digital payments or raises concerns about consumer debt, one thing is clear: Klarna is no longer just a startup, it’s a major player shaping the future of how we shop.