Klarna, the privately owned Swedish payments company, insisted it’s on the path back to profitability after reporting a narrowing fourth-quarter operating loss but a widening loss for 2022 as a whole on Tuesday.
The company, which allows users to buy items online and pay for them in instalments, posted a 2022 full-year operating loss of SEK10.5 billion ($1 billion), compared to SEK6.6 billion in 2021. Revenue increased 19% year-over-year and gross merchandise volume improved by 22%.
However, Klarna's fourth quarter operating loss shrank to SEK2 billion from SEK3.5 billion in the same period of 2021, with GMV 19% higher.
The company attributed the results to declining consumer confidence due to the war in Ukraine and climbing inflation. To stem the tide, Klarna cut 10% of its workforce back in May.
That said, CEO Sebastian Siemiatkowski said the company plans to be profitable by the summer, something it last achieved on a full-year basis in 2018. To do so, the company will need more growth in the US and UK.
"The US and the UK are growing at a very high pace, pushing up the average growth number for the whole company," Siemiatkowski said, as reported by Reuters.
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