Klarna says its pay later options are now available on Google Pay in the U.K.By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions .Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.With this offering, Google Pay users in the U.K. have the choice of using Klarna’s intere ...

Core Viewpoint - The shift towards buy-now, pay-later (BNPL) options among younger consumers presents a significant opportunity for companies like Affirm, which is well-positioned to benefit from this trend [1][4]. Industry Overview - BNPL has gained immense popularity, transforming short-term credit into a convenient checkout option on e-commerce platforms and digital wallets [2]. - Approximately 90 million Americans utilized BNPL services last year, with an average monthly spend per user reaching $244 [3]. Company Positioning - Affirm, a leading BNPL operator, allows consumers to spread payments over time through short-term installment loans, primarily earning fees from merchants rather than charging interest [5][6]. - The average order value for Affirm's short-term products is $100, with funding available for purchases ranging from $35 to $1,000 [6]. Financial Performance - Affirm's gross merchandise volume (GMV) surged from $20.2 billion to $36.7 billion, marking a 38% increase last year [10]. - The company has reduced its operating loss from $1.2 billion in 2023 to $87 million last year, achieving its first profitable quarter on a GAAP basis with an operating income of $63.7 million [15]. Strategic Partnerships - Affirm has established partnerships with major e-commerce platforms like Amazon and Shopify, leading to a 70% increase in total partner volume over the last year [11]. Future Projections - The company projects a GMV of $47.5 billion for its 2026 fiscal year, with anticipated operating margins of 7.5% [16].

Core Insights - Klarna Group has positioned itself as a leading player in the buy now, pay later (BNPL) fintech sector, despite experiencing a stock market decline of over 30% since its September IPO [1] - The overall performance of BNPL stocks, including Sezzle, has been weak, with Sezzle down approximately 20% since Klarna's IPO and over 40% at its October low [2] - Patient investors may find potential in Klarna as it is expected to outperform the S&P 500 in the coming year due to several favorable factors [2] Demand and Growth - The Klarna Card, launched in the U.S. on July 4, has seen rapid adoption, achieving over 1 million sign-ups in its first 11 weeks and reaching 4 million sign-ups within four months [4] - Klarna reported a 28% year-over-year revenue increase, with U.S. revenue surging by 51%, largely driven by the success of the Klarna Card [5] - The card has gained acceptance among over 850,000 retailers, enhancing accessibility to BNPL services and expected to continue driving growth into 2026 and beyond [6] User Base Expansion - Klarna's user base has expanded significantly, with 27 million new users added in the latest quarter, bringing the total to 114 million active users globally [9] - The growth in user numbers and the popularity of the Klarna Card indicate a rising demand for BNPL services, countering criticisms regarding the sustainability of such financial products [8]

Core Insights - Klarna Group plc has launched Tap to Pay in 14 European markets, enhancing its flexible-payment ecosystem in physical retail, addressing the fact that over 80% of European shopping occurs in stores [1][3] - The Klarna Card has gained significant traction, with over 4 million users and acceptance at more than 150 million merchant locations globally, indicating strong customer engagement [2] - Klarna's user base has reached 114 million active users, with 3.4 million daily transactions, showcasing the effectiveness of its product innovations [2] Expansion and Performance - The 14 European countries where Tap to Pay has been introduced include Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, Norway, Poland, Portugal, Spain, and Sweden [3] - In the U.S., Klarna reported a record Black Friday performance, with gross merchandise volume increasing by 45% year-over-year from November 1 to November 28, driven by strong sales in footwear, technology, beauty, and home goods [4] - Klarna is facing increasing competition from companies like Affirm and PayPal, which are expanding their offerings and market presence [5][6] Financial Metrics and Valuation - Klarna's stock has seen a decline of 19.6% over the past month, underperforming the broader industry, which fell by 0.4% [7] - The company trades at a forward price-to-earnings ratio of 72.22X, significantly higher than the industry average of 20.37X, and has a Value Score of D [9] - The Zacks Consensus Estimate predicts a loss of 57 cents per share for Klarna in 2025, with an expected improvement of 188.5% in the following year [9][10]

Core Insights - Lufthansa Group has partnered with Klarna to offer flexible payment options for travelers, allowing them to pay in full, pay later, or pay over time [2][3][4] - The rollout of these payment options began in mid-November across the United States and nine European countries, with plans to expand to all network airlines by the end of Q2 2026 [2][4] Company Strategy - The partnership aims to enhance customer experience by providing greater choice and flexibility in payment methods, aligning with Lufthansa Group's focus on customer needs [4] - Klarna's integration with Adyen, a FinTech platform, is expected to deliver a smooth and flexible checkout experience for Lufthansa Group customers [3][4] Market Trends - A PYMNTS Intelligence report indicates that 8% of consumers used buy now, pay later (BNPL) options for travel expenses in the past three months, highlighting a growing trend towards flexible payment solutions in the travel industry [5] - The convenience of the application process is a significant factor influencing consumers' decisions to use BNPL, with 7% citing it as the most influential reason [5]

Core Insights - The CEO of Affirm, Max Levchin, believes that AI and humanoid robots will serve as tools to enhance human productivity rather than replace jobs [1][3] - The Buy Now, Pay Later (BNPL) market is experiencing significant growth, with 15% of Americans using BNPL services in 2024, and Affirm's stock has increased by 25% in 2025 [2] - Affirm has reported strong fiscal first-quarter results for 2026, with analysts maintaining a positive outlook on the company's growth and stock performance [4][5] Company Performance - Affirm's recent fiscal first-quarter 2026 results were solid, leading to bullish analyst ratings, including a Buy rating from Goldman Sachs with a price target of $94 [4] - JPMorgan has rated Affirm as Overweight, projecting premium volume growth exceeding 20% and expanding operating margins due to increased penetration at platform partners like Shopify, Amazon, and Apple Pay [5] Industry Trends - The sentiment around AI in the workforce is mixed, with a survey indicating that 79% of respondents feel AI has impacted their roles, reflecting concerns about job displacement [3] - Levchin emphasizes that AI will enhance human intelligence and decision-making capabilities, suggesting a future where humans and AI collaborate effectively [6]

Core Insights - Affirm Holdings, Inc. is scheduled to report its Q1 fiscal 2026 results on November 6, 2025, with an expected earnings per share (EPS) of 11 cents and revenues of $885 million [1][6] - The earnings estimate has improved by 1 cent over the past 60 days, indicating a year-over-year EPS growth of 135.5% and a revenue growth of 26.7% [2][6] - For fiscal 2026, the revenue estimate is $3.99 billion, reflecting a 23.9% year-over-year increase, with the current fiscal year's EPS projected at 86 cents, a significant rise from 15 cents a year ago [3] Earnings Expectations - Affirm is predicted to beat earnings estimates due to a positive Earnings ESP of +3.53% and a Zacks Rank of 3 (Hold) [4] - The consensus estimate for merchant network revenues is $247.9 million, indicating a 34.5% increase from the previous year [7] - The Gross Merchandise Volume (GMV) is expected to grow by 36.6%, with management anticipating it to be between $10.1 billion and $10.4 billion [8] Transaction Metrics - Active consumers are projected to grow by 20.8% year-over-year, with transactions per active consumer expected to rise by 12.4% [9] - Card network revenues are estimated to improve by 38.3%, while interest income is projected at $435.9 million, a 15.6% year-over-year increase [10] - Servicing income is expected to reach nearly $37 million, reflecting a 42.3% jump from the prior year [11] Stock Performance - Affirm's stock has increased by 18.4% year-to-date, outperforming the industry growth of 14.8% and significantly surpassing the S&P 500's increase of 17.9% [12] Valuation Insights - Affirm's current valuation is stretched, trading at 5.45X forward 12-month sales, above its three-year median of 3.97X and the industry average of 5.34X, suggesting limited near-term upside potential [16][18] Strategic Developments - The company is expanding globally, entering new markets in Europe and Australia, and forming partnerships with major players like Shopify, Apple Pay, and Google [19][20] - Affirm is diversifying its offerings, including partnerships in the gaming sector and developing new payment solutions, aiming to build a comprehensive financial network beyond its core BNPL operations [20][21] - The company's loyal customer base, driven by transparent pricing and seamless integration, supports stable cash flows, although high leverage poses risks in a competitive BNPL market [21]

Core Insights - Klarna is entering the premium credit card market with a membership program that offers alternatives to high-end credit cards [1][2] - The company plans to roll out its Premium and Max membership programs in the U.S., which are priced at $18 and $45 per month respectively [2][10] Membership Programs - Klarna's Premium membership costs approximately $220 annually and includes access to over a dozen subscriptions, cash back, and other perks [9] - The Max program, costing about $540 annually, offers additional benefits such as travel and rental-car insurance, 1% cash back, and access to airport lounges through LoungeKey [10] Competitive Landscape - Klarna's move reflects a broader trend where traditional banks are enhancing their premium offerings, with companies like American Express and JPMorgan Chase increasing fees while adding benefits [5][8] - Citigroup has also launched its own premium card, Strata Elite, which competes with Klarna's offerings [8] Consumer Impact - The introduction of Klarna's membership program may lead to increased competition for premium credit card customers, potentially affecting the desirability of airport lounges as more consumers gain access [4]

Core Insights - Klarna Group is experiencing significant growth following its IPO, particularly with the launch of its Klarna card, which is gaining popularity among consumers [1][6] Company Overview - Klarna is a leading fintech company that offers buy now, pay later (BNPL) services, providing flexible payment options to consumers [4] - The company has a market capitalization of $29.7 billion, indicating its substantial presence in the financial technology sector [5] Product Launch and Adoption - The Klarna card was launched in July and has quickly become a favorite among customers, with features like real-time transfers and deposits [2] - In the second quarter, the card achieved an acceptance rate of over 150 million merchants globally [2] - Americans are signing up for the Klarna card at a rate of 13,000 per day, with a peak of 50,000 sign-ups on September 23, totaling over 1 million sign-ups in just 11 weeks [3] Market Performance - Klarna's IPO was priced at $40 per share and opened at $52 per share, marking it as one of the most successful IPOs of the year [7] - However, KLAR stock has faced a decline of 13% over the past five days, reaching a low of $37.50 on October 2, though it has since recovered by 12% from that low [7]

Core Insights - Affirm Holdings, Inc. (AFRM) has partnered with Ace Hardware to offer flexible buy now, pay later (BNPL) payment options in stores, enhancing customer experience and affordability [1][8] - The collaboration allows customers to split purchases starting at $50 into manageable payments with clear terms and no hidden fees, making it easier for those on tighter budgets to buy larger items [2][8] - The BNPL market is expanding beyond e-commerce into everyday retail, with brick-and-mortar stores increasingly adopting these solutions to meet consumer demand for transparency and flexibility [3] Company Performance - Affirm's total transactions surged 51.8% year over year in the fourth quarter of fiscal 2025, indicating strong growth and a successful expansion into home improvement retail [4][8] - The company's shares have gained 27.1% year-to-date, outperforming the industry average rise of 19.5% [7] Competitor Analysis - Competitors like Mastercard and Visa are also enhancing their BNPL offerings, with Mastercard reporting 16.8% year-over-year growth in net revenues in Q2 2025 and Visa showing a 10% increase in processed transactions in Q3 2025 [5][6] Valuation and Earnings Estimates - Affirm trades at a forward price-to-sales ratio of 6, slightly above the industry average of 5.62, and carries a Value Score of F [9] - The Zacks Consensus Estimate for Affirm's fiscal 2026 earnings implies a remarkable 473.3% growth from the previous year, with revenue growth projected at 23.4% year-over-year [10]