Klarna shares slide after lowered revenue, GMV guidance

Klarna’s shares fell on the New York Stock Exchange after the buy-now-pay-later firm cut its full-year revenue guidance to $4.08 billion-$4.16 billion and lowered expected gross merchandise volume (GMV) to $149 billion-$151 billion. The company attributed the revision to roughly $600 million in currency translation headwinds and weaker volumes in Germany, its largest market by volume.

Previously, Klarna had forecast revenue above $4.34 billion and GMV of more than $155 billion. The reduced guidance removed those targets from the outlook and preceded the share decline.

Klarna reported stronger operating results for the second quarter despite the weaker outlook. Net income was $9 million, reversing a $53 million loss in the same period a year earlier. Revenue rose 27% to $1.04 billion and GMV increased 18% to $36.6 billion. US transactions were a notable contributor, with US GMV up 27% year on year.

The company announced senior management changes: chief financial officer Niclas Neglén and chief marketing officer David Sandström will depart. Klarna is searching for a new finance chief to be based in New York as part of its effort to obtain a US banking licence. The company described the United States as its fastest-growing market and said its assumptions for growth there remain unchanged.

GMV measures the total value of transactions processed through Klarna’s platform. The currency translation effect reflects how exchange rate movements reduce reported dollar revenue and transaction income when activity is denominated in other currencies.

Klarna released the revised guidance alongside its quarterly results and the management announcements. The company did not publish additional financial targets beyond the updated ranges.