Klarna Revives IPO Plans wiht Lower Valuation Target
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The BNPL provider aims for a U.S. debut with a valuation between $13 billion and $14 billion.
By Amelia Roberts | NEW YORK – 2025/08/26 12:37:00
Klarna, the Swedish “buy now, pay later” (BNPL) firm, is reportedly moving forward again with its plans to become a publicly traded company.
IPO Details and Valuation
According to Reuters, the company hopes for a valuation between $13 billion and $14 billion in its U.S. initial public offering (IPO), potentially launching next month. The details comes from two sources familiar with the situation.
Klarna initially announced its intentions to go public with the Securities and Exchange Commission (SEC) on March 14. Though, those plans were paused due to market instability caused by new U.S. tariffs,a move mirroring other FinTech companies delaying their IPOs.
A previous consideration for an IPO in 2021 did not materialize.
A Klarna spokesperson declined to provide comments.
reportedly, the IPO shares could be priced between $34 and $36 as early as this week.
This target valuation is significantly lower than the nearly $50 billion Klarna sought in 2021 and the more than $15 billion it aimed for earlier in 2025. One source indicated that Klarna intends to raise close to $1 billion through the IPO.
“Splitting a $300 unexpected medical bill or a $400 utility expense across a few pay cycles makes it manageable.”
Data indicates that Klarna currently has the largest portion of the U.S. BNPL market, with 26.2%, followed by AfterPay (21.9%) and Affirm (19.3%).
BNPL services are increasingly common among consumers. According to recent studies, 43% of consumers would abandon a purchase if BNPL options weren’t available, and 42.4% would opt for a cheaper alternative.
Further research suggests that BNPL is especially popular among those living paycheck to paycheck. Sixty-five percent of individuals struggling to cover monthly bills used BNPL in the past year, as did 60% of those who manage to stay on top of their finances while living paycheck to paycheck.
According to PYMNTS CEO Karen Webster, “These consumers see more of their paychecks eaten up by increases in housing, grocery and insurance expenses.”
Webster added, “Splitting a $300 unexpected medical bill or a $400 utility expense across a few pay cycles makes it manageable without taking on revolving debt, borrowing from family or friends, or worse. For these households, installments provide structure and stability amid irregular incomes and rising fixed costs.”
Frequently Asked Questions
- what is BNPL?
- BNPL stands for “buy now, pay later,” a financing option allowing consumers to pay for purchases in installments.
- How does Klarna make money?
- Klarna primarily generates revenue through merchant fees and interest on certain BNPL plans.
- What are the risks of using BNPL?
- Potential risks include overspending, accumulating debt, and late payment fees.
- Is BNPL a good option for everyone?
- BNPL can be a useful tool for managing expenses, but it’s essential to use it responsibly and understand the terms.
- How does BNPL affect my credit score?
- some BNPL providers report payment activity to credit bureaus, which can impact your credit score positively or negatively.
