Klarna shares drop sharply on fourth quarter earnings miss

Klarna Group PLC (Unlisted (US):KLAR) saw its shares driblet astir 25% pursuing the merchandise of its fourth-quarter results aft the institution reported a wider-than-expected nett loss, contempt signaling its archetypal $1 cardinal quarter.

For Q4, the Stockholm-based buy-now, pay-later supplier reported a nett nonaccomplishment of $26 million, oregon $0.19 per share, compared with Wall Street expectations of a $0.02 loss. This marked a important turnaround from the $40 cardinal nett the institution reported successful the aforesaid 4th a twelvemonth earlier.

Revenue, however, grew 38% year-over-year to $1.082 billion, somewhat supra analysts’ estimation of $1.07 billion. Growth was broad-based, with transaction and work gross up 24%, and US gross expanding 58% year-over-year, driven by continued adoption of the company’s Fair Financing offerings.

Klarna besides highlighted maturation successful its user and merchant base. Active Klarna consumers roseate 28% to 118 million, portion the fig of merchants utilizing the level grew 42% to 966,000. Gross merchandise measurement (GMV) accrued 32% to $38.7 billion.

Adjusted operating nett for the 4th was $47 million, and the institution reported aboriginal advancement successful subscription offerings, with 3.5 cardinal subscriptions presently successful proceedings periods expected to lend to aboriginal monetization.

“We're gathering a planetary integer slope that saves consumers clip and wealth and puts them successful power of their finances. Our results amusement consumers are bare for it,” Klarna CEO Sebastian Siemiatkowski said successful a missive to shareholders. “In Q4 we delivered our archetypal billion-dollar gross quarter—$1.08 billion, up 38% year-over-year and supra guidance, the US grew 58%. GMV deed $38.7 billion.”

Despite the gross gains, investors focused connected the net miss and nett loss, starring to the crisp driblet successful Klarna’s stock terms since the report.