(Sharecast News) - Klarna reported its first quarterly profit since its New York listing on Thursday, as the Swedish-founded payments group continued to expand beyond buy now, pay later into broader consumer finance.
The company said net income was $1m in the first quarter, compared with a net loss of $99m a year earlier and ahead of analyst expectations for a $67.2m loss cited by Bloomberg.

Operating income was $17m, compared with a $90m loss in the prior-year period, while adjusted operating profit rose to $68m from $3m.

Revenue increased 44% year on year to $1.0bn, supported by higher interest income, growth in its debit card product and fee income from partnerships.

Gross merchandise volume rose 33% to $33.7bn, with US volume up 39% and non-US volume up 31%.

Transaction margin dollars increased 44% to $389m.

"In Q1 we executed well across all the business, driving every line of our P&L and compounding growth across our global network," said chief executive and co-founder Sebastian Siemiatkowski.

Klarna had been trying to reduce its reliance on buy now, pay later loans and reposition itself as a digital bank, with products including debit cards, savings and longer-term interest-bearing financing.

"It's the everyday spend, the debit, the day-to-day transactions, and the saving products that we have," Siemiatkowski told Bloomberg.

Active consumers rose 21% year on year to 119 million, while the number of merchants using Klarna increased 49% to more than 1 million.

The Klarna Card now had five million active users across 16 countries, while Fair Financing GMV rose 138% as consumers used longer-term payment options for larger purchases.

The company said customer engagement was deepening over time.

Consumers who first used Klarna in 2022 generated $12 in annual revenue per user in their first year, compared with $52 today.

Klarna also launched peer-to-peer payments across 13 European countries in January.

Credit provisions rose 37% year on year to $186m, reflecting growth in longer-term lending, but provisions as a share of GMV were broadly stable at 0.55%, compared with 0.54% a year earlier.

Klarna said delinquency rates were continuing to fall as its underwriting models matured.

The company said revenue per employee reached nearly $1.4m, four times the 2022 level, as revenue growth continued to outpace operating expenses.

It also secured a $2bn forward flow facility in the quarter, supporting $17bn of US financing capacity and helping fund the growth of Fair Financing.

Klarna said its network was expanding through payments partnerships with Stripe and Nexi, while JPMorgan Payments and Worldpay were expected to go live soon.

It also announced new merchant partnerships across travel, furniture, gaming, eyewear and car parts, including Lufthansa, Qatar Airways, Article, Mindfactory and Quay.

The results marked a potential turning point after a difficult start to life as a public company.

Klarna listed in New York last September at a valuation of about $15bn, but the Financial Times said its shares had since fallen around 70%.

Klarna reiterated its full-year 2026 guidance.

For the second quarter, it expects GMV of $35.5bn to $36.5bn, revenue of $960m to $1.0bn, transaction margin dollars of $375m to $395m and adjusted operating income of $30m to $50m.

At 0804 EDT (1304 BST), shares in Klarna Group were up 3.58% in premarket trading in New York at $14.18.

Reporting by Josh White for Sharecast.com.

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