Klarna Set to Report Q4 Earnings: Key Factors Investors Should Watch

Core Insights - Klarna Group plc (KLAR) is expected to report fourth-quarter 2025 results on February 19, 2026, with a consensus estimate of a loss of 3 cents per share and revenues of $1.07 billion [1] Financial Performance Expectations - The fourth-quarter earnings estimate has seen one upward revision in the past month, indicating a sequential improvement of 88%, while revenues are expected to grow by 18.5% from the previous quarter [2] - For the full year 2025, Klarna's revenue is estimated at $3.51 billion, reflecting a year-over-year increase of 24.9%, with a consensus EPS estimate of a loss of 48 cents, a significant decline from the previous year's earnings of 1 cent per share [3] Earnings Prediction and Model Insights - The current model does not predict an earnings beat for Klarna, with an Earnings ESP of -20.65% and a Zacks Rank of 3 (Hold) [4] Factors Influencing Q4 Results - Klarna anticipates Q4 revenues of $1.07 billion and gross merchandise volume (GMV) between $37.5 billion and $38.5 billion, with expected transaction margin dollars of $390 million to $400 million [7] - The company's growth is supported by increasing transaction and service revenues, rising interest income, and new partnerships contributing to global expansion [8] - GMV growth momentum is expected to continue, with new signups for the Klarna Card acting as a tailwind [9] Operational Efficiency and Challenges - AI-driven productivity and cost discipline are expected to enhance operational efficiency, although provisions for credit losses are likely to have increased due to upfront provisions related to Fair Financing portfolio growth [10] Peer Performance Comparison - Affirm Holdings reported a second-quarter fiscal 2026 EPS of 37 cents, beating estimates by 32.1% and showing a 60.9% year-over-year increase, with net revenues of $1.1 billion, a 30% year-over-year jump [11] - American Express reported fourth-quarter 2025 EPS of $3.53, slightly missing estimates but showing a 16% year-over-year increase, with total revenues of $19 billion, a 10% year-over-year improvement [12]