Klarna shares drop sharply on fourth quarter earnings miss

Core Viewpoint - Klarna's shares fell nearly 25% after reporting a larger-than-expected net loss in Q4, despite achieving its first $1 billion revenue quarter [1][5]. Financial Performance - For Q4, Klarna reported a net loss of $26 million, or $0.19 per share, compared to Wall Street's expectation of a $0.02 loss, marking a significant decline from a $40 million profit in the same quarter last year [2]. - Revenue grew 38% year-over-year to $1.082 billion, slightly exceeding analysts' estimates of $1.07 billion [3]. - Adjusted operating profit for the quarter was $47 million [4]. Growth Metrics - Active Klarna consumers increased by 28% to 118 million, while the number of merchants using the platform grew by 42% to 966,000 [4]. - Gross merchandise volume (GMV) rose 32% to $38.7 billion [4]. - US revenue surged 58% year-over-year, driven by the adoption of Fair Financing offerings [3]. Strategic Outlook - Klarna's CEO emphasized the company's goal of building a global digital bank that enhances consumer control over finances, highlighting the strong demand for its services [5]. - The company reported early progress in subscription offerings, with 3.5 million subscriptions currently in trial periods, expected to contribute to future monetization [4].