NEW YORK, Feb 20, 2026, 05:10 (EST) — Premarket
Klarna Group plc (NYSE: KLAR) shares are set to reopen on Friday after closing down 26.9% at $13.85 in the previous session, one of the sharpest slides since the company’s New York listing. (Reuters)
The move matters because Klarna is still early in life as a public company, and investors are quickly repricing what “growth” means when it comes with higher funding and credit costs.
Klarna’s pitch is shifting from “buy now, pay later” — short-term instalment loans at checkout — to broader banking-style products. That changes the timing of profits, and it makes guidance and credit trends the pressure points.
Klarna swung to a $26 million fourth-quarter net loss from a $40 million profit a year earlier, missing an average analyst forecast for a smaller loss, Reuters reported. CEO Sebastian Siemiatkowski said fast growth weighed on results because costs are booked up front, adding: “As growth comes down a little bit, that will start to play out very favourably.” JPMorgan said the transition toward engagement and lending was weighing on key performance indicators, and pointed to higher processing and funding costs. (Reuters)
In its earnings release, Klarna said fourth-quarter revenue rose 38% to $1.082 billion and gross merchandise volume (GMV) — the value of goods sold through its network — climbed 32% to $38.7 billion. But processing and servicing costs rose to $250 million and provisions for credit losses, money set aside for expected defaults, increased to $250 million; funding costs rose to $210 million. The company forecast first-quarter revenue of $900 million to $980 million and GMV of $32 billion to $33 billion, and said its outlook assumes modest declines in short-term benchmark rates and a gradual rollout of “default-on” partnerships, including with Worldpay and JPMorgan Payments. (Q4 Capital Data)
One risk: if consumer delinquencies tick higher or funding markets stay tight, the margin squeeze could last longer than bulls expect, even if transaction volume holds up. A slower ramp in longer-duration lending or partner rollouts would also test the 2026 targets management put on the table.
Klarna priced its IPO at $40 a share and began trading on the NYSE in September 2025. (Klarna Investors)
The next catalyst is February 26, when Klarna said it will publish its full annual financial statements. Traders will be looking for more detail on credit costs, funding lines and whether the company keeps its 2026 outlook intact after Thursday’s selloff. (Q4 Capital Data)
