Klarna shares plunged more than 20% on Tuesday after the buy-now-pay-later company delivered disappointing guidance alongside its second-quarter earnings, rattling investors who had bet on the fintech's growth trajectory.
Despite posting Q2 revenue of $1.04 billion — up 27% year over year and beating analyst expectations — Klarna slashed its full-year 2026 revenue guidance to a range of $4.08 billion to $4.16 billion, down from prior projections. The company also trimmed its gross merchandise volume forecast, citing slowing retail sales in Germany, its largest European market.
Adding to the negative sentiment, Klarna announced that its Chief Financial Officer and Chief Marketing Officer would both leave their roles early next year. The leadership shakeup, combined with the guidance cut, triggered the steepest single-day decline since the company's IPO.
Klarna went public earlier this year in a closely watched listing that initially saw shares surge. The stock had been trading at a premium as investors bet on the company's AI-driven cost reductions and expansion into the US market.
The results raise questions about the broader buy-now-pay-later sector, which has faced increasing regulatory scrutiny and competition from traditional banks launching their own installment payment products. Klarna remains one of the largest BNPL providers globally, but the German retail slowdown suggests that consumer spending patterns may be shifting in key markets.
The stock closed at approximately $15.06, down from around $19.50 before the earnings release.
