BNPL giant Klarna has reported soaring operating losses of $748 million for the full year 2021, driven by expansion to fresh markets and the challenges of underwriting a massive inflow of new customers.
The company, which is reportedly weighing a new funding round that will value it at up to $60 billion, saw losses grow by 408% compared to $150 million reported in the year prior.
In terms of business growth, the company appears to be in rude health. Gross merchandise volumes reached record levels of $80 billion and net operating income increased 38% to $1.6 billion as the company recruited 46 million new consumers and extended its reach to 45 countries.
Sebastian Siemiatkowski, CEO and Co-Founder of Klarna comments: “We are now serving more than 100m active customers across the world. I am pleased to say that 99% of our lending globally is repaid. But we have also continued to grow our Pay Now immediate settlement option that today represents c40% of our total transaction volume. With some truly exciting companies like Stocard and Hero joining Klarna, our active consumer number will grow to over 147m. We have also massively accelerated our global expansion with the addition of 10 new markets since the start of 2020.”
Klarna's massive outlay in entering the US market is beginning to reap dividends says Siemiatkowski. The US, currently Klarna’s fastest-growing key market by volume and its second-largest by revenue, is on track to become the company's largest market globally.
Siemiatkowski says that in December, US downloads of the Klarna app outpaced PayPal, YouTube, Snapchat, Whatsapp and Twitter.