Fight Now, Pay Later: Will Klarna's IPO Turn Up the Heat On Affirm?

Group 1 - Klarna is preparing for a U.S. IPO that could value the company at approximately $14 billion, raising competitive concerns for Affirm Holdings, Inc. [1][8] - As of the June quarter-end, Klarna had 790,000 merchants and 111 million active consumers, generating $31.2 billion in gross merchandise value (GMV), while Affirm had 377,000 merchants, 23 million active users, and $10.4 billion in GMV, reflecting a 43% year-over-year increase [2][8] - Affirm is expanding its presence in Europe through partnerships, particularly with Shopify, while Klarna is expected to strengthen its position in the U.S. market [3][8] Group 2 - Other BNPL providers like PayPal and Block are also expanding their market share, with PayPal reporting a total payment volume of $443.5 billion, a 6% increase, and Block's BNPL platform achieving a GMV of $9.11 billion, a 17% year-over-year increase [4][5] - Affirm's shares have increased by 43.4% year to date, outperforming the broader industry and the S&P 500 Index [6] - The Zacks Consensus Estimate for Affirm's fiscal 2026 earnings suggests a significant year-over-year growth of 473.3%, indicating strong future performance expectations [11][12]