Klarna's Billion-Dollar IPO: Is This Buy Now, Pay Later Giant the Next Big Thing?

2025-09-10 18:00:29.141

Shares of Klarna, the Swedish buy now, pay later company, skyrocketed in its highly anticipated NYSE debut. Opening at $52 a share—a 30% premium over its $40 pricing—the IPO sold over 34 million shares, totaling approximately $1.37 billion, making it 2025's largest IPO so far. The company, founded in 2005 and entering the US market in 2015, has expanded rapidly, partnering with major retailers like Macy's and Walmart. Klarna's CEO, Sebastian Siemiatkowski, highlighted the massive US consumer market and credit card market as key drivers for its US IPO. Klarna's popular "pay-in-4" plan and longer-term payment options have attracted 111 million global users, presenting an alternative to traditional credit cards. While concerns exist regarding potential consumer overspending, Klarna emphasizes its low average user balance and adjustable underwriting standards. The IPO made Siemiatkowski and early investor Victor Jacobsson billionaires. Major investors like Sequoia Capital and Silver Lake also reaped significant returns. Klarna reported strong second-quarter revenue and relatively low delinquency rates. With a market capitalization second only to Affirm, Klarna aims to capture market share from traditional banks and credit cards. JPMorgan Chase and Goldman Sachs served as primary underwriters for the IPO.