Klarna valued at $19bn in Wall Street debut

Shares in buy-now, pay-later giant Klarna surged on their first day of trading in New York, briefly giving the Swedish firm a market value above $19bn (£14bn).

The initial public offering (IPO) raised $1.37bn, with shares priced at $40 each. They opened at $52, up 30%, before easing back to $46 by the close, leaving the company worth about $17bn.

Founded in 2005, Klarna has grown into one of the world’s biggest payments firms, offering shoppers the option to split purchases into interest-free instalments. It handled $105bn in transactions last year and counts more than 93 million active users across 26 countries. In Sweden, its home market, more than 80% of adults used the service in 2024.

The listing marks a major moment for Klarna, which has positioned itself as a challenger to credit cards and banks but has faced scrutiny over whether its model encourages overspending.

Chief executive Sebastian Siemiatkowski told staff the IPO would provide “fuel” for expansion into new markets.

Despite the fanfare, the company’s valuation remains far below its 2021 peak of $45bn, when SoftBank invested before rising interest rates and a global slowdown hit the fintech sector.

Revenue rose 24% last year to $2.8bn, but Klarna remains unprofitable in the US, reporting a $52m loss in the second quarter.

Investor Joachim Dal of GP Bullhound said the market misunderstood the firm: “It’s more of a payment company than a lender… more about facilitating a smooth checkout than providing credit.”

Klarna’s debut comes as Wall Street enjoys record highs, with other tech firms — including crypto exchange Gemini — also rushing to go public.