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Klarna Group Plc
(NYSE:KLAR)
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Rating:54Neutral
Price Target:
$13.00
▼(-8.90% Downside)
Action:Reiterated
Date:08/20/26
The score is driven mainly by uneven financial performance—particularly the 2025 cash flow reversal and renewed losses—plus weak technicals with the stock trading below major moving averages. These risks are partially offset by a constructive earnings call showing improving profitability and margin expansion, despite a notable cut to GMV and revenue guidance tied to FX and softer German demand.
Positive Factors
Revenue and margin expansion
Rapid revenue growth combined with much faster transaction-margin expansion indicates improving monetization and operating leverage. If sustained, the stronger margin conversion can fund product investment, support profitability, and enhance Klarna’s competitive position across its consumer and merchant network.
Negative Factors
Sharp cash-flow deterioration
The reversal from positive cash generation in 2022–2024 to substantial 2025 cash burn materially weakens financial flexibility. Persistent negative operating and free cash flow could require additional financing, constrain investment choices, and increase dependence on debt while the business scales.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and margin expansion
Rapid revenue growth combined with much faster transaction-margin expansion indicates improving monetization and operating leverage. If sustained, the stronger margin conversion can fund product investment, support profitability, and enhance Klarna’s competitive position across its consumer and merchant network.
Read all positive factors
Klarna Group Plc (KLAR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.43B
Dividend YieldN/A
Average Volume (3M)5.37M
Price to Earnings (P/E)―
Beta (1Y)2.40
Revenue Growth34.10%
EPS Growth-28.93%
CountryUS
Employees2,831
SectorGeneral
Sector StrengthN/A
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)-0.38
Shares Outstanding377,507,900
10 Day Avg. Volume5,247,847
30 Day Avg. Volume5,369,983
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)4.29
Price to Sales (P/S)3.07
P/FCF Ratio-10.40
Enterprise Value/Market Cap0.93
Enterprise Value/Revenue1.71
Enterprise Value/Gross Profit2.77
Enterprise Value/Ebitda30.84
Forecast
1Y Price Target
$17.77Price Target Upside24.52% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
EPS Forecast (FY)-0.03
Revenue Forecast (FY)$4.13B
Klarna Group Plc Business Overview & Revenue Model
Company Description
Klarna Group plc operates as a technology-driven payments provider, extending its services across the United Kingdom, United States, Germany, Sweden, and globally. The company offers a wide array of solutions, including advertising and marketing, ...
How the Company Makes Money
Klarna primarily makes money by monetizing transactions and financing across its consumer–merchant network. Key revenue streams typically include: (1) Merchant fees: Klarna charges merchants for offering Klarna at checkout; these fees are commonly...
Klarna Group Plc Earnings Call Summary
Earnings Call Date:Aug 18, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 17, 2026
Earnings Call Sentiment Positive
The call presents a strongly positive operating and margin story: robust revenue growth (+27%), significant expansion in transaction margin dollars (+42%) and improving profitability (adjusted operating income $91M; net income positive). Rapid product and distribution progress (Fair Financing, card growth, 2M subscribers, major PSP and Apple partnerships) underpin long-term upside. Offsetting these positives are a meaningful guidance pullback driven by softer German consumer demand and FX (GMV and revenue trims), an accounting presentation change that complicates comparability, and planned H2 investments that pressure near-term operating income (notably low Q3 AOI and elevated share-based comp). On balance, the highlights significantly outweigh the lowlights given strong margin conversion, profitability trajectory and strategic distribution gains.Positive Updates
Strong Top-Line Growth
Total revenue of $1.042B, up 27% year-over-year, outpacing GMV growth; GMV of $36.6B, up 18% YoY (15% like-for-like).
Negative Updates
Full-Year GMV and Revenue Guidance Revision
Full-year GMV guidance reduced to $149B–$151B (previously above $155B) — implying ~17% YoY growth — and revenue guidance lowered to $4.08B–$4.16B (from above $4.34B), primarily due to FX and weaker-than-expected German consumer demand (approx $600M of the GMV revision attributed to currency movement).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line Growth
Total revenue of $1.042B, up 27% year-over-year, outpacing GMV growth; GMV of $36.6B, up 18% YoY (15% like-for-like).
Read all positive updates
Company Guidance
Klarna updated full‑year guidance to $149–151 billion GMV (~17% YoY, down from >$155B), with roughly $600 million of the revision due to FX and the remainder from softer German consumer trends; revenue is now guided to $4.08–4.16 billion (vs. >$4.34B prior). Full‑year transaction margin dollars were raised to $1.62–1.65 billion (1.09% of GMV, up from 1.04%), reflecting a ~2 bps timing benefit from a fair‑value presentation change, an expected $40–50 million of incremental TMD from stronger unit economics, and a reported take‑rate reduction of ~10 bps of GMV (reported 2.74–2.75% vs. comparable 2.84–2.85%). Adjusted operating income is guided to $280–300 million (6.9–7.2% of revenue) with adjusted OpEx growth ~15% versus TMD growth >30%; Q3 guidance is GMV $35–36 billion, revenue $940–980 million, TMD $340–360 million and adjusted operating income $5–15 million, while U.S. volume assumptions remain unchanged and the U.S. is expected to stay the fastest‑growing large region.Klarna Group Plc Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
66
Positive
Cash Flow
45
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.04B | 3.51B | 2.67B | 2.20B | 1.89B | 1.62B |
| Gross Profit | 2.50B | 1.91B | 2.07B | 1.66B | 1.37B | 1.02B |
| EBITDA | 224.00M | 551.00M | 427.00M | 126.00M | -687.00M | -574.19M |
| Net Income | -143.00M | -294.00M | 3.00M | -249.00M | -1.04B | -775.71M |
Balance Sheet | ||||||
| Total Assets | 17.77B | 18.80B | 13.80B | 13.75B | 12.01B | 11.81B |
| Cash, Cash Equivalents and Short-Term Investments | 2.67B | 3.80B | 3.59B | 2.39B | 2.57B | 2.83B |
| Total Debt | 1.69B | 1.43B | 791.00M | 472.00M | 637.95M | 1.28B |
| Total Liabilities | 15.10B | 16.11B | 11.55B | 11.55B | 9.69B | 9.10B |
| Stockholders Equity | 2.44B | 2.51B | 2.09B | 2.19B | 2.32B | 2.70B |
Cash Flow | ||||||
| Free Cash Flow | -3.80B | -1.03B | 542.00M | 723.00M | 231.00M | -392.56M |
| Operating Cash Flow | -3.78B | -1.03B | 587.00M | 808.00M | 336.00M | -365.47M |
| Investing Cash Flow | -32.00M | -30.00M | 154.00M | -83.00M | -459.00M | -489.40M |
| Financing Cash Flow | 1.02B | 988.00M | 312.00M | -62.00M | 18.00M | 2.14B |
Klarna Group Plc Technical Analysis
Negative
14.27
Price Trends
14.06
Negative
16.36
Negative
16.88
Negative
Market Momentum
-0.24
Negative
45.55
Neutral
29.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KLAR, the sentiment is Negative. The current price of 14.27 is above the 20-day moving average (MA) of 13.08, above the 50-day MA of 14.06, and below the 200-day MA of 16.88, indicating a neutral trend. The MACD of -0.24 indicates Negative momentum. The RSI at 45.55 is Neutral, neither overbought nor oversold. The STOCH value of 29.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KLAR.
Klarna Group Plc Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $18.97B | 39.20 | 23.79% | ― | 23.04% | 111.91% | |
71 Outperform | $2.43B | 50.71 | 7.27% | ― | 6.31% | -48.91% | |
68 Neutral | $24.92B | 12.87 | 47.91% | ― | 32.43% | 3583.15% | |
67 Neutral | $1.95B | 191.84 | 1.36% | ― | 22.41% | ― | |
66 Neutral | $3.12B | 62.14 | 5.65% | ― | 32.44% | -78.82% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
54 Neutral | $7.43B | -34.29 | -5.80% | ― | 34.10% | -28.93% |
* General Sector Average
KLAR
Klarna Group Plc
13.23
-23.77
-64.24%
FOUR
Shift4 Payments
40.17
-35.82
-47.14%
PAYO
Payoneer
7.17
1.14
18.91%
AFRM
Affirm Holdings
72.40
-3.14
-4.16%
MQ
Marqeta
19.35
0.35
1.84%
TOST
Toast Inc
33.42
-5.38
-13.87%
Klarna Group Plc Corporate Events
Klarna Turns Profitable in Q2 2026 and Raises Margin Outlook on Strong Consumer and Merchant Growth
Aug 18, 2026
On August 18, 2026, Klarna reported strong second-quarter 2026 results, with gross merchandise volume rising 18% year-on-year to $36.6 billion and revenue up 27% to $1.042 billion, while transaction margin dollars jumped 42% to $446 million. The c...
Klarna to Power Apple’s New U.S. Hardware Leasing Program
Jul 28, 2026
On July 28, 2026, Klarna announced it will act as the leasing provider for Apple Upgrade, a new hardware leasing program offered by Apple in the United States. The service allows customers to lease eligible iPhone, Mac, iPad and Apple Watch device...
Klarna Applies for U.S. Banking Charter to Launch Klarna Bank USA
Jul 6, 2026
On July 6, 2026, Klarna Group plc announced that it has submitted applications to the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation to establish Klarna Bank USA, a Utah‑chartered industrial bank. The...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.