Fintech giant Klarna has filed a registration statement to the SEC to propose an IPO but has put the process on hold due to the upheaval in the global markets fueled by US-imposed tariffs.
When the buy-now-pay-later vendor restarts the process, it could potentially transform the dynamics of the global payments market.
The Stockholm-based firm has applied to list its shares on the NYSE. The price range of the IPO has yet to be finalized.
In 2024, Klarna’s revenues surged by 24%, to $2.81 billion, compared to $2.28 billion two years ago. Its valuation has also fluctuated, peaking at $46 billion in 2021 before rapidly declining to $6.7 billion the following year.
Risk-averse investors are typically more reluctant to capitalize during market uncertainty or anticipated price instability.
“This IPO has the potential to significantly impact the payments market.” Says Conor Moore, the global head of KPMG Private Enterprise. “It could be good but could be bad depending on the performance of the offering. It is also in the buy now, pay later space, which is a subset of the broader payments ecosystem, so not necessarily a bellwether for the entire space but definitely very important for those competitors in a similar space.”
Ibotta was the last real IPO test for the payments market in April 2024. It raised $577 million in an offering priced above the marketed range.
It’s ambiguous whether the Klarna IPO will be a catalyst for further high profile fintech IPOs. According to S&P Global Market Intelligence, in the US there has not been a completed fintech IPO since 2021, and only nine of them finalized in the past five years.
“It is likely one of the companies that has been ‘ready’ to go for some time, and may feel now is the right time,” Moore reflects. “It is a positive that one of the higher profile companies is dipping its toe into the pond.” Several large fintech firms have similar operating histories in recent periods, with revenue growth coupled with cost cutting to achieve profitability.
