Other negative metrics include an eye-wateringly high cost-income ratio of 128%.
However, its revenue increased by 21%, reaching $1.85bn in FY2022.
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Klarna’s annual financial results come after what has been a torrid year for the global BNPL market. In September 2022, Klarna announced a second round of layoffs, four months after cutting 10% of its global workforce.
Meantime, Australian BNPL monoline Laybuy has delisted from the Australian ASX. In addition, Openpay collapsed into receivership with rival Latitude Pay announcing its failure on 24 February.
However, Klarna CEO Sebastian Siemiatkowski says the company will aim to make “concrete progress towards profitability” in a bid to reassure pessimistic shareholders.
According to Siemiatkowski, Klarna’s credit loss rate improved by 30% during Q422 versus the same period in 2021.
“Klarna is revolutionizing retail banking by taking on the $16 trillion-dollar global payments industry that costs society an outrageous $440bn annually. We want to restore the original purpose of payments and banking – facilitating and accelerating commerce by providing increased choice, transparency and cost-effectiveness everywhere. Utilizing advanced technology and innovative features, we are reducing payment costs to society by 60% compared to traditional players”, Siemiatkowski said.
