Sweden's Klarna shifts AI focus from cost cuts to growth

Core Insights - Klarna's CEO acknowledged that the company may have over-relied on artificial intelligence for cost-cutting, leading to a shift in focus towards enhancing services and products [1][3] - The company made its market debut in New York, with shares rising 30% to $52, valuing Klarna at $19.7 billion, significantly above its IPO price of $40 [2][4] - Klarna has implemented significant job cuts and vendor changes, transitioning to AI for marketing campaigns, but is now attempting to correct its rapid adoption of the technology [3][4] Financial Performance - Klarna raised $1.37 billion in its U.S. IPO, valuing the company at $15 billion, which may influence future high-growth fintech listings [4] - The company reduced its workforce from 5,000 to 3,800, with further reductions anticipated as it utilizes AI for customer service, where a chatbot is performing the work of 700 employees [4][6] Productivity and Growth Strategy - Although Klarna saved approximately $2 million by replacing Salesforce with AI tools, the CEO emphasized that investors are more focused on growth and customer offerings rather than cost savings [6] - The company is now actively hiring again, with over two dozen positions available, indicating a shift back towards human resources [5] Market Position - Klarna is recognized for transforming online shopping through its short-term financing model and is now listing in the U.S., its largest market, where it competes with companies like Affirm [7]